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Union Budget 2025 : India tech sector is all charged up for an AI led digital revolution Firstpost

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Key Objectives of the Union Budget 2025

The Union Budget 2025 is expected to focus on several key objectives, including:

  • Enhancing infrastructure development to support economic growth
  • Promoting financial inclusion to reduce poverty and inequality
  • Fostering innovation and entrepreneurship through R&D incentives
  • Streamlining regulatory frameworks to reduce bureaucratic hurdles
  • Enhancing digital infrastructure to support economic growth

    • Infrastructure Development

    The Union Budget 2025 is expected to prioritize infrastructure development to support economic growth. This includes investments in:

  • Transportation infrastructure, such as roads, railways, and airports
  • Energy infrastructure, such as power plants and transmission lines
  • Water and sanitation infrastructure, such as dams, canals, and sewage systems
  • Digital infrastructure, such as high-speed internet and data centers

    • Financial Inclusion

    The Union Budget 2025 is expected to promote financial inclusion to reduce poverty and inequality.

    The Current State of Fintech and Digital Payments in India

    The Indian fintech and digital payment ecosystem has experienced rapid growth in recent years, driven by the increasing adoption of mobile phones and the proliferation of digital payment platforms. According to a report by the Reserve Bank of India (RBI), the number of digital payment transactions in India has grown from 1.3 billion in 2015 to over 2.5 billion in 2020.

    The sector is concerned that the government’s current approach to DPDP is too vague and lacks clear guidelines for businesses to follow. The sector is calling for more specific regulations and clearer guidance on how to handle sensitive data.

    The Digital Personal Data Protection (DPDP) Act: A Call for Clarity

    The Digital Personal Data Protection (DPDP) Act is a crucial piece of legislation that aims to protect the personal data of individuals in the digital age.

    The Current State of DPDP Regulations

    The current DPDP regulations are based on the 2018 Data Protection Act, which was amended in 2020. While the amendments aimed to strengthen data protection, they also introduced new challenges for businesses. The sector argues that the current regulations are too broad and lack specificity, making it difficult for businesses to understand what is expected of them.

    “We need to invest in data centres to support the growth of AI and other emerging technologies.”

    The Importance of Infrastructure for India’s AI Ambitions

    India’s AI ambitions are being driven by the government’s vision to become a global leader in the field. However, the country faces significant challenges in achieving this goal due to its limited infrastructure.

    Bridging the AI Gap in Tier II and Tier III Cities with Centres of Excellence.

    The Need for AI Centres of Excellence

    The Indian government has been actively promoting the adoption of Artificial Intelligence (AI) technologies across various sectors. However, the current AI ecosystem in India is largely concentrated in Tier I cities, leaving Tier II and Tier III cities behind. To bridge this gap, the government has been exploring various initiatives to promote AI adoption in these regions.

    Key Challenges

  • Limited access to high-quality data and talent
  • Insufficient infrastructure and digital literacy
  • Lack of standardization and interoperability

    • These challenges hinder the growth of AI adoption in Tier II and Tier III cities, making it difficult for businesses to tap into the potential of AI-driven technologies.

    AI Centres of Excellence: A Solution

    Establishing AI Centres of Excellence in Tier II and Tier III cities can help address the challenges faced by these regions.

    “We are optimistic about the budget’s focus on promoting electronics manufacturing in India, which will create new opportunities for our industry and the country as a whole.”

    The Electronics Sector: A Key Driver of Growth

    The electronics sector has emerged as a crucial driver of growth in India, with the government recognizing its potential to create new opportunities and jobs. The sector has been identified as a key area for investment, with a focus on critical technologies such as semiconductors, batteries, and display technologies.

    Key Areas of Investment

  • Semiconductors: The Indian government has set a target of becoming a leading player in the global semiconductor market, with a focus on developing domestic capabilities. Batteries: The sector is expected to see significant growth in the coming years, driven by the increasing demand for electric vehicles and renewable energy systems. Display Technologies: The Indian government has also identified display technologies as a key area for investment, with a focus on developing domestic capabilities and reducing dependence on imports. ## The Union Budget: A Catalyst for Growth*

    • The Union Budget: A Catalyst for Growth

    The upcoming Union Budget is expected to play a significant role in accelerating growth in the electronics and smartphone manufacturing industries. The government has announced several initiatives aimed at promoting electronics manufacturing in India, including:

  • Tax incentives: The government has announced tax incentives for companies that invest in electronics manufacturing, including a 10% tax rebate on capital expenditure.

    The Rise of India as a Global Electronics Hub

    India has been steadily increasing its presence in the global electronics and semiconductor production landscape. The country’s strategic location, skilled workforce, and favorable business environment have made it an attractive destination for foreign investors. As a result, India is poised to become a major player in the global electronics industry.

    Key Factors Driving India’s Rise

    Several factors are contributing to India’s growth as a global electronics hub:

  • Strategic Location: India’s geographical location, situated between Europe and Asia, makes it an ideal hub for electronics production. The country’s proximity to major markets in Europe and Asia allows for efficient supply chain management and reduced transportation costs. Skilled Workforce: India has a large pool of skilled engineers and technicians, which is a significant advantage in the electronics industry. The country’s educational institutions and research institutions are producing a steady supply of talented professionals. Favorable Business Environment: India offers a favorable business environment, with a relatively low cost of living and doing business. The country’s government has also implemented policies to encourage foreign investment and promote entrepreneurship. * Government Support: The Indian government has launched several initiatives to promote the electronics industry, including the “Make in India” program.

    The sector is expected to witness significant growth in the coming years, driven by increasing adoption of digital assets, advancements in technology, and the growing demand for decentralized finance (DeFi) services.

    The Rise of Virtual Digital Assets

    A New Era of Financial Inclusion

    The virtual digital asset sector is poised to revolutionize the way we think about money and finance. With the rise of decentralized finance (DeFi) services, individuals and businesses can now access a wide range of financial products and services that were previously inaccessible. This includes lending, borrowing, trading, and more.

    The Importance of Cybersecurity in India’s Tech Ecosystem

    Cybersecurity has become a pressing concern for India’s tech industry, with the country’s growing dependence on digital technologies creating new vulnerabilities. As India’s digital economy continues to expand, the need for robust cybersecurity measures has never been more pressing. Key statistics:

    • India’s digital economy is projected to reach $4 trillion by 2025 (Source: NITI Aayog)
    • The country’s cybersecurity market is expected to grow at a CAGR of 15% from 2020 to 2025 (Source: MarketsandMarkets)
  • Threats to cybersecurity:
    • Ransomware attacks
    • Data breaches
    • Phishing scams
    • Advanced Persistent Threats (APTs)

      • The consequences of a cybersecurity breach can be severe, with potential losses running into billions of dollars. In 2020, a major data breach at a leading Indian bank resulted in the theft of sensitive customer information, highlighting the need for robust cybersecurity measures.

      The Role of 5G Infrastructure in India’s Tech Ecosystem

      The rollout of 5G infrastructure is a critical component of India’s tech ecosystem, with the potential to drive innovation and economic growth.

      The PLI Scheme: A Key Driver for Drone Manufacturing

      The Production Linked Incentive (PLI) scheme is a government-backed initiative aimed at promoting domestic manufacturing in the drone sector. The scheme provides incentives to companies that invest in research and development, manufacturing, and hiring local talent. The PLI scheme has been instrumental in boosting the growth of the drone industry in India, and its expansion to include drone technology is expected to further accelerate the sector’s development.

      Benefits of the PLI Scheme for Drone Manufacturers

    • Increased investment: The PLI scheme provides a significant incentive to companies to invest in research and development, manufacturing, and hiring local talent. Improved manufacturing capabilities: The scheme helps companies to improve their manufacturing capabilities, leading to increased efficiency and productivity. Enhanced R&D capabilities: The PLI scheme encourages companies to invest in research and development, leading to the creation of new technologies and products. * Job creation: The scheme helps to create new job opportunities in the drone manufacturing sector. ## The ‘Make in India’ Initiative: Reducing Dependence on Foreign Imports**

      • The ‘Make in India’ Initiative: Reducing Dependence on Foreign Imports

      The ‘Make in India’ initiative is a government-backed program aimed at promoting domestic manufacturing in India. The initiative focuses on reducing dependence on foreign imports by fostering indigenous manufacturing.

      Here are some key points to consider:

      Key Initiatives

    • The Union Budget 2025 is expected to focus on emerging technologies such as artificial intelligence, blockchain, and the Internet of Things (IoT). The government aims to create a favorable business environment for startups and scale-ups, with a focus on innovation and entrepreneurship. The budget will also provide support for the development of 5G networks and the adoption of digital technologies in various sectors. ## The Role of Drone Technology*

      • The Role of Drone Technology

    • The government has set ambitious targets for the growth of the drone industry, with a focus on increasing exports and creating jobs. The budget will provide support for the development of drone manufacturing and testing facilities, as well as training programs for drone pilots. The government aims to establish India as a global leader in drone technology, with a focus on innovation and R\&D. ## The Impact on the Economy*

      • The Impact on the Economy

    • The growth of the tech sector, including drone technology, is expected to create new job opportunities and stimulate economic growth. The budget will also provide support for the development of new industries and sectors, such as drone-based services and applications. The government aims to increase the country’s competitiveness in the global market, with a focus on innovation and entrepreneurship. ## The Way Forward*

      • The Way Forward

    • The Union Budget 2025 has the potential to serve as a transformative milestone for the country’s tech sector, with a focus on emerging technologies and innovation. The government’s support for the growth of the drone industry and other emerging technologies will help to create new job opportunities and stimulate economic growth.

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