Providing a solid push for the Startup India initiative brought out by the Government of India, there is a new support system for the technology companies in the form of a National Software Policy. This is a trendsetting offering in the sense the policy aims to create more India-based software companies, which could bring out products on the global platform. It thus anticipates tremendous employment generation - for over 3.5 million more people over the next 5 – 7 years by some estimates. That, in turn, implies a sizeable contribution of the software industry as a whole to the Indian economy.
Despite having done quite well over the last couple of decades, compared to the other countries, Indian software sector is still only making its mark. Globally, the software product industry is worth $411 billion. The Indian contribution to that is just at $6.1 billion. Especially in the wake of the currency rate fluctuations being seen across the globe, worryingly enough, the Indian software services exporters managed to secure barely 8% of the total deals awarded in 2015-16 (Source - LiveMint). That is a lot of precious money lost. In that sense, the National Software Policy should be able to create a sound environment for thousands of startups (the official figure stands at 10,000 technology startups) to develop globally accepted software products. The draft policy states that "it will strive for a ten-fold increase in the share of the global software product market by 2025 by promoting easy access to local domestic/ international market for software products. We believe, that such a policy will thus help in bringing the Indian talent pool to the fore.
This policy will also be good for the industry since the government plans to make further use of software products in other sectors such as railways, telecommunications, healthcare, defence, power, atomic energy, and so on. It will lead to further employment opportunities not just in the software product industry but also in startups wanting to grow in the other sectors mentioned. Why it becomes all the more important is because the policy has provisions to nurture a specialised talent pool of 1,000,000 software professionals by 2025 to provide quality support to the software product industry.
Even the software product think-tank iSpirt supports the thought that software products in India do have the potential to become a $100 billion industry by 2025, especially with a robust contribution from startups in the space. The National Software Policy and the Startup India initiative come together with the aim of maximising the contribution of the software product industry. The policy also mentions important facets such as R&D, market access, and government procurement. If it does manage to create an environment which will facilitate startups with these advantages vis-a-vis expensive, internationally sourced services, the policy will be a boon for an inclusive sustainable indigenous software product industry.
There is another vital aspect to this policy which could also turn out to be a trendsetter. We all are aware of how businesses, especially startups, suffer due to complex economic rules and regulations followed in India. The National Software Policy has certain provisions which will simplify the taxations norms revolving around software products. It will also set up an Inter-Ministerial Coordination Group to address any needs and concerns of the software product industry. Both these measures will ensure greater ease of doing business in these sectors and will attract further interest from the professionals. Once compliance becomes easier, the industry will greatly benefit. At the same time, such provisions and easing of doing business will also help other global companies notice the Indian market, prompting greater investment and better trade relations.