As the countdown to the Union Budget 2020 begins, finance minister Nirmala Sitharaman will have pre-budget consultations with stakeholder groups from across sectors starting Monday, December 16. The Union Budget 2020-21 is likely to be presented on February 1.
The discussions are reportedly aimed at triggering economic revival, which is likely to be the key focus for the Union Budget 2020. Over the next few days, the finance minister will meet stakeholder groups from startups, fintech and digital, financial sector, capital markets, industry, services and trade, agriculture and agro-processing, social sector, water and sanitation, trade union and labour organisations, industrialists, infrastructure, energy and economists to seek inputs for boosting growth.
“The first set of discussions will be held with representatives of the ‘new economy’ including startups, fintech and digital industries, on using big data technology for improving the forecasting of economic, financial and climatic phenomena by analysing large data sets,” an ET report said quoting an unidentified source.
What Government Expects From Startups
The government plans to have discussions with startups on matters of ease of doing business for them and regulatory and financing gaps hindering their sustainable growth. “It also wants to understand the reasons for startups registering outside India, as 15 out of 33 Indian unicorns are domiciled outside India, and find ways to increase participation of domestic investors financing startups,” report quoted another unidentified source.
The government will reportedly be focussing on measures such as regulation of digital economy, including privacy, consumer protection and financial regulation. Discussions on steps to achieve electronics and information technology ministry’s target of digital economy’s contribution of $1 Tn will be held, with announcements expected at the Budget 2020.
Prime Minister Narendra Modi has reiterated that the Indian startup ecosystem will help India achieve the government’s target of $5 Tn economy. During his speech at the IIT Madras convocation on September 30, Modi had said “Your innovation, aspiration and application of technology will fuel this dream [of $5 Tn economy]. It has become the bedrock of India’s big leap into the most competitive economy.”
Finance minister Sitharaman, while presenting her maiden budget, presented a roadmap to achieve the target of $5 Tn economy by 2024. The framework included strategic disinvestment, cutting down the corporate tax, making investments more lucrative for foreign entities, and a push to the Indian startup ecosystem through various policies.
India’s gross domestic product slipped to 4.5% in the second quarter (July-September) of the year 2019-20, a fall of 0.5% compared to the last quarter. The GDP numbers have been seeing a decline for seven quarters now.