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5G, AI, and R&D focus in telecom sector’s budget wishlist

Similar expectations are directed toward the Union Budget 2025 by the telecom sector, which views it as an opportunity to solve their perennial problems and facilitate the growth of telecom.

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Ayushi Singh
New Update
Union Budget 2022: Telecom Sector Reacts

The Union Budget 2025 is likely to undertake major changes to boost the telecom sector which is one of the key drivers to facilitate digitization in India’s economy. The government is believed to spend on infrastructure development, rationalising spectrum prices, and technologically innovative concepts because of their initiative for helping accelerate the growth of 5G and the Digital India movement. Investors in this field would be expecting some reduction in taxes on telecommunication services in hope of affordability leading to increase in adoption rates. Further, measures to enhance public-private partnership for rural connectivity and the development of 6G and other AI based communication technologies will provide a great boost to indigenous R&D. This is expected to increase economic output, job growth, and establish India as a key player in the global telecom market.

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Similar expectations are directed toward the Union Budget 2025 by the telecom sector, which views it as an opportunity to solve their perennial problems and facilitate the growth of telecom. Industry leaders are asking for fewer financial burdens on operators by asking the government to lower the spectrum usage charges and license fees. There is also expectation for for a significant reduction in the license fee from 3% to 1% of AGR in the upcoming budget.  There are expectations for increased budgetary allocations for rural connectivities and the 5G infrastructure rollout to close the digital gap and speed up the digital transformation.Industry stakeholders have also called for policies promoting indigenous manufacturing of telecommunication equipment under the Make In India initiative. Although the feelings are positive at this stage, the industry is very guarded regarding the government’s ability to spend for other regions while attending to this industry. With a positive budget, innovation, investment, and accessibility to customers could be positively impacted within the telecom sector.

“Nittin Arora, Partner, Grant Thornton Bharat emphasized , "as we approach the Union Budget 2025, the telecom industry looks forward to supportive measures that will accelerate digital connectivity and innovation. Policy announcements to ease the financial burden on operators would be welcomed. The industry would also like to see continuation of measures to promote domestic manufacturing sector and encourage incubation of emerging technologies. Streamlining indirect tax exemptions throughout the sat-com value chain would promote more research in this technology as the government contemplates allocation of spectrum for these services. These measures would help towards India’s ambition of being a global leader in communications and drive the next phase of digital transformation across the country.

Girish Hirde, Global Delivery Head at InfoVision said, “InfoVision anticipates a forward-looking agenda that addresses the transformative potential of AI and other cutting-edge technologies. We expect robust provisions to maintain India's global competitiveness in the rapidly evolving tech landscape. Key areas we hope to see addressed include investments in AI infrastructure, establishment of clear ethical guidelines for AI development, and tax incentives for companies investing in AI and emerging tech training programs.
 
Furthermore, we look forward to support for telecom advancements, particularly in 5G and 6G infrastructure, which are crucial for enabling AI and IoT applications at scale. We also anticipate increased allocation for cybersecurity to strengthen India's digital defenses, enhanced funding for AI and deep-tech startups, and incentives for AI integration across sectors like healthcare, agriculture, and manufacturing. By focusing on these areas, Budget 2025 can lay the foundation for India to lead in the AI era, creating sustainable job opportunities and driving optimal growth in the digital”

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Pramod Sharda, CEO of IceWarp India and the Middle East commented“As we approach the Union Budget 2025, we anticipate strategic reforms that bolster India’s digital ecosystem and drive technological self-reliance. The past few years have highlighted the transformative power of digital adoption across industries, and it is imperative that this momentum is sustained through forward-thinking policies.

We hope the government continues to prioritize investments in digital infrastructure, particularly in Tier 2 and Tier 3 cities, to bridge the digital divide and unlock the untapped potential of these regions. A reduction in GST rates on enterprise technology solutions would encourage businesses to adopt advanced tools, boosting productivity and fostering innovation.

Additionally, it is crucial to address cybersecurity, as the rise in digital adoption brings with it the need for robust frameworks to safeguard data and digital assets. Incentivizing investments in R&D for indigenous technology development will also be a step towards achieving digital independence.

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Startups in the technology domain are a driving force behind India’s economic growth. We look forward to budgetary provisions that support their scaling efforts through relaxed compliance, simplified taxation, and increased funding opportunities.

At IceWarp, we remain committed to empowering organizations with cutting-edge enterprise communication and collaboration solutions, and we are optimistic that Budget 2025 will create a conducive environment for businesses to thrive in the ever-evolving digital landscape.”

Yug Bhatia, Founder and CEO of Control Z, has provided valuable insights regarding his pre-budget expectations, he said, "It is imperative that the government focuses on policies that drive the growth of the circular economy and sustainable technology sectors. With the global refurbished smartphone market growing at a compound annual growth rate (CAGR) of 10.23% through 2028, and India’s e-waste management industry projected to reach USD 7.5 billion by 2025, the opportunity to capitalize on sustainable technology is immense.To accelerate this shift, the government should prioritize the following in the upcoming budget:

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Tax Incentives for Refurbishment and Recycling: Providing tax incentives for companies engaged in refurbishing and recycling electronics will drive industry growth, reduce e-waste, and support sustainable consumption at scale. 

Investing in R&D for Green Tech: Allocating funds for research into innovative, sustainable tech and advanced recycling methods will position India as a leader in green technology and innovation. 

Public Awareness Campaigns: With more than 70% of Indian consumers now open to purchasing refurbished products, government-backed awareness campaigns can drive significant consumer behavior change, expanding the demand for sustainable tech. 

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By implementing these measures, the government can foster a thriving circular economy, reduce environmental impact, and establish India as a global leader in the sustainable technology space."

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