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Public Policy
Monthly Mailer
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| February 2025 |
Vol 7, Issue 2 |
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MOF | Union Budget 2025-26
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The Union Budget 2025-26 (Budget 2025) has been welcomed by industry. We are encouraged with the government’s commitment to leverage and harness technology for growth, as is evident from a host of measures. Some of the key announcements for the technology services industry that are in line with our recommendations are as follows:
- Exploring a DeepTech Fund: The proposal to explore a Deep Tech Fund of Funds to catalyse next-generation startups will be important for India to have Global winners in DeepTech in key commercial segments and areas critical to India's requirements. Nasscom has been advocating for setting up a structured Deep Tech fund to enhance access to patient capital for DeepTech startups. We will work with the government and industry to ensure that the proposal is crystalised.
- Setting up a new Fund of Funds for startups: The proposal to set up a new Fund of Funds (FoF) with expanded scope and a fresh contribution of ₹10,000 crore should help attract greater private investments into a broader cross section of start-ups.
- National Framework for GCCs: The proposal to introduce a national framework as guidance to states for promoting GCCs in tier 2 cities is welcome. This is in line with nasscom’s recommendations to the government on taking a holistic approach to enabling ease of doing business for the GCCs and developing the talent availability and infrastructure in tier 2 cities, with a view to attract the IT industry, including the GCCs.
- Introduction of 3-year block assessment for international transactions: The proposal to determine Arm's Length Price (ALP) of international transactions for a block period of three years is a welcome proposal. This should help in enabling speedier assessments of the past years where the facts of the business are essentially the same. This is akin to an Advance Pricing Agreement (APA) in reverse, so taxpayers do have the possibility to fast-track the audit closures and bring them up to date.
- Rationalisation of Tax Deduction at Source (TDS) provisions: The announcement to reduce the number of rates and increase thresholds above which TDS needs to be deducted will improve ease of doing business and better compliance by taxpayers.
- Omission of TCS provisions under S. 206C(1H) of Income Tax Act, 1961 on sale of goods: This will provide certainty to the industry (Read more)
On February 03, 2025, nasscom conducted an interactive session on Union Budget 2025 to discuss the impact on Tech Sector. The session had over hundred participants from the industry. During the session, we discussed the proposals related to the proposed new Income Tax Bill, certainty in tax assessment in international taxation, impact of DeepTech fund and Funds of Fund on startups and other EODB measures. Recording of the discussion is available here.
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As a next step, Nasscom is finalising a detailed post budget memorandum highlighting concerns and recommendations to strengthen the budget proposals. Please reach out to tejasvi@nasscom.in for more information.
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TEC | Draft standard on robustness for assessing and rating robustness of AI systems in telecom networks and digital infrastructure
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In November 2024, TEC released a draft standard for assessment of robustness of AI systems for-stakeholder consultation. In our feedback to TEC, we suggested to increase the usability and adoption of the draft standard, for instance, by clearly stating priority areas where such standards merit adoption and defining the expression ‘AI systems’ for clear guidance to users, given the term has been widely used throughout the standard. We also sought clarity on whether and how the draft standard intends to address assessment of risks that may arise from open-source models, given that downstream AI applications based on open-source models are gaining traction in India. We underlined the importance of a whole-of-government approach and engagement with the global standards landscape to align India’s role in developing standards for AI. (Read more)
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Nasscom | Roundtable on DPDP Rules, 2025
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Nasscom, in collaboration with DSCI, organised a closed door in-person discussion in Delhi to discuss the draft DPDP Rules, 2025. Bhuvnesh Kumar, Additional Secretary, MEITY and Deepak Goel, Scientist G, MEITY, other senior officials of MEITY, and industry stakeholders like data protection officers, participated in a focused discussion to understand how the draft Rules can be strengthened in a manner that leads to effective and appropriate compliance and minimises uncertainty and onerous obligations. Previously, nasscom had published its preliminary analysis of the draft rules and continues to engage with the industry to consolidate their inputs for providing feedback to the government.
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Nasscom | Roundtable on Power and Connectivity Related Issues of Data Centers
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Nasscom, in collaboration with MEITY, held a closed-door discussion in Delhi with various government authorities and DC representatives, to discuss the power supply and connectivity related issues. The discussion was co-chaired by Sanket S Bhondve, Joint Secretary, MEITY, and Deepak Rao, Director (Powergrid), MOP. Other government officials at the discussion included Sanjay Koul, Scientist E, from MEITY, Irfan Ahmad, Chief Engineer, Abhishek, Deputy Director, and Ganeshwar Rao Jada, Deputy Director, from CEA, Ashok Pal, Director & COO, from CTUIL, Divyanshu Jha, Deputy Secretary, from MNRE, Nilesh Purey, CTO, from GIFT City, and Meenal Anand, Senior Sector Expert, from BEE. The objective was to co-examine these two themes and discuss the next steps for enabling the growth of DC industry in India. The discussions focused on the following essential considerations:
- Electric Power Supply: Adequacy of power supply (quantity and quality) required redundancy and resilience, grid infrastructure, favourable locations for setting up DC parks, and other ease of doing business issues.
- Connectivity: Location of cable landing substations and dark fiber connectivity for captive use.
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Roundtable on Empowering AI startups under India AI mission
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A roundtable discussion was organised by Chase India in Delhi to discuss findings of a recent survey conducted on AI startups working across sectors. At this roundtable, Sudipto Banerjee highlighted the advocacy work that nasscom has been doing with the DeepTech community and stressed upon the need to create a dedicated fund of fund structure for DeepTech startups to boost the funding ecosystem in India. The discussion was attended by officials of MEITY, AI startup founders and venture capital representatives.
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Nasscom | Discussion on GST Advocacy
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Nasscom organised virtual discussions on GST for the IT-BPM and e-commerce sectors. During the discussion, nasscom updated the industry regarding the ongoing advocacy initiatives and their outcomes for the previous years. The second part of the discussion focussed on industry-wide strategic priorities for the upcoming year. We have noted the various strategic areas discussed with the industry and will be taking up these with the government in the current year. For more details, please write to tejasvi@nasscom.in
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Haryana Govt | Pre-Budget Consultation
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Nasscom participated in a pre-budget consultation meeting with the Haryana Chief Minister to discuss our suggestions for the Haryana State Budget. At this meeting, we made suggestions on the issues of boosting startup/ Deeptech ecosystem in the state, resolving labour issues of compliance under CLRA (Contract Labour (Regulation and Abolition) Act, 1970) and women in night shift and strengthening collaboration on skilling and Centres of Excellence.
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DGFT | National Conference on Strategic Trade Controls
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The NCSTC 2025, was organised by DGFT in collaboration with MEA and other key government departments, in Bengaluru on January 16-17, 2025. It covered key themes, including SCOMET policy and licensing for dual-use items, export control mechanisms in Defence & Aerospace, and risk mitigation in Chemicals & Biotechnology. Nasscom nominated experts participated in sessions on Compliance and Industry Perspective in Electronics, IT & Emerging Technologies and Strategic Trade and a separate session on ITT compliance. Nasscom’s contribution in co-development of booklet on Internal Compliance Program with DGFT was acknowledged several times. A major highlight of the conference was the release of the 2025 Handbook on Strategic Trade Controls by DGFT. (Read more)
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MEITY | Call for Inputs on DPDP Rules 2025
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MEITY has released the Draft Digital Personal Data Protection Rules, 2025 on January 3, 2025. The deadline for submitting inputs on the draft rules to MEITY is February 18, 2025. Nasscom is currently in the process of developing feedback on the draft rules and have rolled out call for inputs on January 08, 2025. The concerns and suggestions on the draft rules can be submitted by February 07, 2025, to sudipto@nasscom.in and nalini@nasscom.in. (Read more)
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MEITY | Report on AI Governance Guidelines Development
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MEITY has published a report on “AI Governance Guidelines Development” for public consultation on January 6, 2025. In the context of AI governance in India, the report emphasises the need for a coordinated, whole-of-government approach to ensure compliance and effective governance as India’s AI ecosystem grows. To operationalise this approach, the report provides six key recommendations. The deadline for the public consultation was extended by one month to February 27, 2025. Kindly submit your written inputs on the report before February 19, 2025, to sudipto@nasscom.in and dhananjay@nasscom.in
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BIS | Draft Indian Standard on E-commerce Principles and Guidelines for Self-Governance
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BIS is seeking stakeholder inputs on proposed draft Standard. Key areas addressed in the Standard include: (i) Registration requirements and KYC processes for sellers Product listing and information disclosure requirements (iii) Consumer consent and transaction review processes (iv) Payment systems and recurring charge guidelines (v) Dispute resolution and consumer grievance handling (vi) Anti-counterfeiting measures (vii) Fair business practice principles. The deadline for stakeholder feedback on the draft Standard is February 20, 2025. Kindly submit your written inputs to ananya@nasscom.in and swapnil@nasscom.in before February 14, 2025.
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DGFT | Voluntary Disclosure Guidelines for Non-Compliance/Violations related to Export of Special Chemicals, Organisms, Materials, Equipment, and Technologies (SCOMET) items
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The DGFT notified guidelines, where exporters can voluntarily disclose past violations related to unauthorised exports or breaches of SCOMET guidelines. These may include unauthorised exports, transactions with UNSC-sanctioned entities, misuse of export authorisations, failure to obtain necessary permissions, non-compliance with reporting requirements, unauthorised access to technical data, and other SCOMET-related violations. While self-disclosure does not exempt entities from penalties, the Inter-Ministerial Working Group (IMWG) may consider it a mitigating factor when determining enforcement actions. For feedback, please write to swapnil@nasscom.in. (Read more)
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MOF | ECONOMIC SURVEY
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The Economic Survey 2024-25 (Survey) was tabled in Parliament on January 31, 2025. The Survey highlighted Indian IT/ ITeS industry’s leading position globally as a significant contributor to the growth of exports, nearly USD 200 billion with an estimated overall revenue of USD 254 billion. It highlighted the fact that over the past five years, India has been at the forefront of the global GCC expansion strategy with more than 400 new GCCs and around 1100 new units established. The Survey recognised AI, e-commerce and data centers as growth areas in the upcoming year. (Read more)
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EPFO
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EPFO's January 2025 updates introduce automatic PF transfers, a simplified Joint Declaration (JD) process, and direct online profile updates, reducing delays and employer dependence. PF transfers have been automated for Aadhaar-linked UANs issued after October 1, 2017, aiding in seamless fund movement. The JD process has been streamlined with three-tier categorisation, DigiLocker integration, and faster approvals, while claimants of deceased employees no longer require Aadhaar verification. Employees with Aadhaar-verified UANs can now update demographic details online without employer approval. These changes are expected to make EPFO processes faster, simpler, and more accessible for employees and pensioners. For feedback, please write to swapnil@nasscom.in. (Read more)
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AI
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Artificial Intelligence
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APA
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Advance Pricing Agreements
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BEE
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Bureau of Energy Efficiency
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BIS
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Bureau of Indian Standards
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CEA
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Central Electricity Authority
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COE
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Centre of Excellence
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CTUIL
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Central Transmission Utility of India Ltd
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DC
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Data Centre
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DGFT
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Directorate General of Foreign Trade
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DOT
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Department of Telecommunications
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DPIIT
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Department for Promotion of Industry and Industrial Trade
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DPDP
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Digital Personal Data Protection
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DSCI
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Data Security Council of India
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EPFO
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Employees' Provident Fund Organisation
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FM
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Finance Minister
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GCC
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Global Capability Centre
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GST
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Goods and Services Tax
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IMWG
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Inter-Ministerial Working Group
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IOT
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Internet of Things
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IT
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Information Technology
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ITeS
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Information Technology Enabled Services
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ITT
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Intangible Technology Transfer
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MEITY
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Ministry of Electronics and Information Technology
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MNRE
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Ministry of New and Renewable Energy
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MOCI
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Ministry of Commerce & Industry
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MOF
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Ministry of Finance
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MOP
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Ministry Of Power
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NCSTC
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National Conference on Strategic Trade Controls
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PF
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Provident Fund
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SCOMET
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Special Chemicals, Organisms, Materials, Equipment, and Technologies
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TCS
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Tax Collection at Source
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TDS
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Tax Deduction at Source
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TEC
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Telecommunication Engineering Centre
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TSP
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Telecom Service Provider
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UAN
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Unified Account Number
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UNSC
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United Nation Security Council
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www.nasscom.in
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