As the Union Budget 2025-26 approaches, key players in the IT and Electronics industries are urging the government to introduce incentives for the Make in India initiative, boost semiconductor manufacturing, and enhance funding for artificial intelligence (AI) research and development. They are also seeking tax relief for tech startups, increased investment in digital infrastructure, and comprehensive skill development programs. Industry leaders believe these measures will strengthen India’s position as a global technology hub while fostering innovation and job creation. Union Finance Minister Nirmala Sitharaman is set to present the budget on February 1.
The semiconductor sector, seen as a critical growth area, requires streamlined regulations, with industry experts calling for faster customs clearance for semiconductor materials, lower GST on locally made components, and reduced import duties on key inputs. Leaders also advocate for government-backed venture capital funds and incentives to attract Non-Resident Indian (NRI) engineers working at global semiconductor firms back to India. Meanwhile, the IT industry is emphasizing the need for substantial AI research funding, regulatory sandboxes for experimentation, and increased export incentives for AI-driven technologies, particularly in generative AI, to enhance India’s global competitiveness.
Infrastructure development, job creation, and skill development are other top priorities for industry stakeholders. Experts stress the importance of integrating technology into construction and infrastructure projects to drive economic growth. Additionally, leaders highlight the need for targeted investments in skilling and upskilling programs, particularly in emerging technologies, to bridge talent gaps and prepare a future-ready workforce. Calls for tax relief and regulatory simplifications for startups and small-to-medium enterprises (SMEs) have also been made, alongside proposals for AI implementation in government ministries to set an industry-wide example.