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Budget 2025: Tech in Focus – A Transformative Framework for GCCs, Startups, and AI

The Union Budget 2025 has placed a strong emphasis on emerging technologies, innovation, and digital transformation. Finance Minister Nirmala Sitharaman has announced a comprehensive framework to propel India’s technology landscape forward. Key highlights include a national framework for Global Capability Centres (GCCs) in Tier-2 cities, a Rs 500-crore Centre of Excellence (CoE) in Artificial Intelligence (AI) for education, and a new ‘Fund of Funds’ to support deep tech startups.

National Framework for Global Capability Centres (GCCs)

To enhance India’s position as a global technology hub, the government will formulate a national framework to guide states in fostering GCCs in Tier-2 cities. This initiative aims to:

  • Expand the availability of skilled talent
  • Strengthen digital and physical infrastructure
  • Implement byelaw reforms to attract global enterprises
  • Foster industry collaborations to drive innovation and growth

India’s GCC sector has seen remarkable progress, growing to over 1,700 centers in FY24. Strengthening Tier-2 cities as tech hubs will enable inclusive growth, reduce regional disparities, and improve talent retention by offering professionals opportunities closer to home.

Centre of Excellence (CoE) in AI for Education

Building on the success of the three AI Centres of Excellence established in 2023 for agriculture, healthcare, and sustainable cities, the government has now announced a CoE in AI for education with a total outlay of Rs 500 crore. This initiative aims to:

  • Enhance AI-driven learning tools
  • Improve digital literacy
  • Support AI research and innovation in the education sector

This move underscores India’s commitment to leveraging AI for academic excellence, equipping students and educators with state-of-the-art technology for a knowledge-driven future.

New ‘Fund of Funds’ to Drive Startup Innovation

A new Fund of Funds with an expanded scope and an additional Rs 10,000 crore contribution has been introduced to fuel the next generation of deep tech startups. This fund will:

  • Support Alternate Investment Funds (AIFs) focused on tech-driven ventures
  • Address capital constraints for innovative enterprises
  • Strengthen India’s deep-tech and AI ecosystem

The government-backed Fund of Funds has already contributed Rs 10,000 crore, resulting in commitments exceeding Rs 91,000 crore to Alternate Investment Funds. The expansion of this initiative will further accelerate venture capital investments and startup funding, strengthening India’s position in the global startup ecosystem.

Enhanced Credit Guarantee for Startups

Recognizing the financial challenges faced by startups, the budget also includes measures to enhance access to capital:

  • Credit guarantee cover increased from Rs 10 crore to Rs 20 crore
  • Guarantee fee moderated to 1% for loans in 27 focus sectors supporting Atmanirbhar Bharat

These measures aim to empower entrepreneurs, drive innovation, and ensure the growth of India’s digital economy.

Strengthening India’s AI and Deep Tech Ecosystem

Experts in the tech and investment sectors have welcomed the budget’s focus on AI and deep tech. Industry leaders believe that:

  • The Deep Tech Fund of Funds will accelerate India’s AI race and global competitiveness
  • IITs, NITs, and IISc will play a crucial role in building India’s AI talent pool
  • The PM Research Fellowship Scheme will provide 10,000 fellowships over five years, fostering cutting-edge research in AI and emerging technologies

Conclusion

The Union Budget 2025 has laid out a visionary roadmap to position India as a global technology leader. By strengthening GCCs in Tier-2 cities, expanding AI excellence, boosting startup funding, and enhancing credit access, the government is fostering an environment of innovation, inclusivity, and sustainable growth.

As Cybertech Creation continues to leverage AI-driven digital marketing strategies, we remain committed to keeping businesses ahead in the evolving tech landscape. Stay tuned for more insights and updates on how these budgetary reforms can impact your digital transformation journey.

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