Representative image (Photo Credit: PTI)
Hyderabad: Describing note ban as “a bold step”, former Nasscom Chairman B V R Mohan Reddy on Thursday said the upcoming Budget is likely to take steps to strengthen the demonetisation initiative by easing liquidity in the system and stimulating demand.
Reddy said the Budget becomes even more important as the nation is going through a big initiative of demonetisation whose impacts come in various forms.
In a country like India, where 86 per cent of the transactions happen in cash, this is “a bold step by the Government to push the economy to a digital highway.
“Demonetisation will have positive impacts in the long-term and definitely improve transparency and efficiency in the system. The coming Budget is expected to strengthen the demonetisation initiative by easing liquidity in the system and stimulating demand,” he said.
Reddy opined there is a need of robust infrastructure creation to enable a smooth digital economy.
“Infrastructure building is something which needs time and Government encouragement. The upcoming Budget should announce a more easier framework and guidelines to own the card payment machines (POS terminals) by SMEs.”
For the IT industry, the currency exchange exercise had no impact as most of the business was traditionally cashless, he said.
The Founder and Executive Chairman of Cyient, an IT firm, said the software product development industry has been largely dominated by SMEs which has been suffering with the 10 per cent TDS levied on all software transactions.
The Budget should address this issue to make sure Government provides the required boost to the software product SMEs, he said.