India is a land of IT services, not so much software products. There are many product companies, but we mostly don't hear of them, or they aren't big national or international names to attract instant recall. For instance, a Google or a Microsoft. Now, the new NDA government is expected to push ahead with an agenda to put Indian software products and product start-ups on the national map.
In February this year, the Union Cabinet, chaired by Prime Minister Modi, approved the National Policy on Software Products - 2019. In its first 100 days, the new government is expected to press ahead on this - the idea is to increase India's share of the global software product market ten-fold by 2025.
What are the policy's main missions that the government is likely to work towards? There are four.
The first is to nurture 10,000 technology start-ups in the software product industry, which would also include 1000 start-ups in tier-II and tier-III towns and cities. The policy states that it could generate direct and in-direct employment for 3.5 million people by 2025. The second pillar is to create a talent pool for the software product industry through up-skilling of 1,000,000 IT professionals and motivating 100,000 school and college students. The policy also intends to generate 10,000 specialised professionals that can provide leadership.
The third mission is to "build a cluster-based innovation driven ecosystem by developing 20 sectoral and strategically located software product development clusters having integrated ICT infrastructure, marketing, incubation, R&D/testbeds and mentoring support". The last of the pillars has to do with monitoring of the scheme and programmes under this policy - a National Software Products Mission is expected to be set up with participation from the government, academia and the industry.
While the policy looks good, a lot could depend on the domestic market access start-ups manage to bag. One industry watcher Business Today spoke to said that world-class software products are developed on the back of "friendly, sophisticated governments". This means that the software developed must be given an opportunity to be deployed in India and be proven in the home market - this has remained a difficult task till date when it came to government procurements. The policy, nevertheless, suggests that "an enabling framework will be developed for preferential inclusion of Indian software product in Government procurement in line with the Public Procurement (Preference to Make in India), Order 2017".
Besides pushing ahead with this policy on software products, the new government is expected to work around a 'Stay-In-India' agenda. In other words, re-domicile Indian start-ups who move to foreign shores or prefer incorporation outside India simply because it is easier to do business that way. There is, however, no silver bullet on how this could be done - a policy expert says convincing starts to relocate back would require nothing less than a "ground war" sort of a door-to-door campaign by the government.
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