Mynd Solutions Pvt. Ltd. a global service provider in business process and technology management, offering broad spectrum of services in finance and accounting (F&A), human resource outsourcing (HRO), IT Solutions and consulting has following expectations and recommendations from the government in the upcoming union budget 2016 Sundeep Mohindru, Director,Mynd Solutions has highlighted the key aspects of establishing and running a business with focus on start-ups and micro, small and medium enterprises (MSME) in India.
Definition of start-ups
India is going through the phase of changes and new outlook is being worked upon. The prime minister (PM) has laid the path for enhancement of entrepreneurship in the country. The PM’s initiative for making available finance for start-ups and related incentives is going to take concrete shape in the upcoming budget. The initiatives will be given to new businesses set up after 31st March 2016. At Mynd Solutions,we are serving and supporting many customers to set up their business, all clients that have set up their businesses in the past two years are feeling strapped to miss this opportunity. Also existing entrepreneurs setting up new lines of business as start-ups in their current running companies are feeling that they will miss out on this opportunity by government of India. Therefore, the definition of start-ups has to be widened enough to support all the initiatives taken by entrepreneurs.
Ease of doing business
Company law changes made by Companies Act 2013 do not support the ease of doing business in India, especially for holding and subsidiary companies relationships for unlisted companies. These are small businesses that don’t have enough resources to manage the requirements of Companies act. A review by government has been discussed at many stages and many new notifications have been released to ease this space after 2013. However, a lot has to be done to support the ease of doing business in India.
Incentives for export of services
Incentives for export of services are limited and have been released only for corporates operating in special economic zones (SEZ) area. However, micro, small and medium enterprises(MSME) have limited access to SEZ set-ups and enjoy no export incentive for the export of services. India is growing tremendously in services arena and export benefit rules shall be made available for export of services. In the initial days, government released the scheme of software technology parks of India (STPI) for information technology (IT) and IT enabled services (ITES). This scheme was utilised by MSMEs and export units flourished in almost every city where such parks were established. Incentives of STPI scheme could be enjoyed by all companies operating from their respective place of business. Current rules released by government in 2015 limit these incentives to companies operating from SEZ area. These rules have to be relaxed to widen the coverage of operations.
In 2014, the government of India had launched an ambitious programme “Make in India” which infused a fresh breath of air in increasing job opportunities for 10 million workforces that enters the market every year and also 10,000 Start-ups initiative, a mega-program that aims to catalyse 10,000 technology start-ups over the next decade. In the upcoming budget, we look forward to the enhanced implementation plan of these policy initiatives and introduction of similar policy initiatives to boost jobs especially in the underdeveloping areas such as infrastructure, aviation, and real-estate.
Skill Development and compliance reforms
Enhancing Employability and access to a skilled talent pool is a critical enabler for India’s competitiveness. Secondly, enhancing the ease of managing compliances through E-governance / single-window concept policy reforms shall only strengthen the policy of ease of doing business for both domestic and international corporates. Recent initiative of “Digital India” is an extremely welcoming step towards covering both above points, however, it’ll be interesting to see the policy implementationframework especially government-Industry partnership model in the upcoming fiscal to achieve quantifiable results on the ground.