Previous year was indeed a challenging year for the global economy, India emerged as the fastest growing economy in the world – even amidst continuing ambiguity. At this moment, government is ought to provide start-ups the impetus for growth. In a move to enhance the start-up ecosystem scenario in India and give it a much needed push, government has come up with a list of tax concessions. However, weak investments and subdued demand conditions post demonetisation still remains to be a major concern area.
Capital is the biggest need for tech start-ups in India. Right now, it’s not easy for tech start-ups to avail loans from banks due to requirement of physical assets as collateral for these loans. However, the biggest assets that tech start-ups have today are their intellectual properties and the products they develop. It will be of great help if the government recognises these as collateral for loans from banks. Introduction of additional incentives under key projects introduced by the government such a Digital India, Skill India, Start-Up India, Make in India can encourage the sentiments amongst investors, both domestic and foreign.
Policies and regulatory measures that offers ease of doing business acts as a helping hand. With the way start-ups function these days, we tend to use a lot of tools to track, function and power the products. A lot of times, these tools are not the ones made by Indian companies. Taxes on the fee paid for these tools become a complicated process. The government must think about updating the laws to recognise these scenarios as well, to ensure that start-ups do not wait for rebates for a long period of time.
We hope that this year, the budget will lay the groundwork to generate more prospects for innovation in the start-up sector especially in the tech space.
(By Ananda Kumar, CFO, Exotel)