{Union Budget 2025: Focus Tech} Deep Tech Fund of Funds, 10k fellowships under the PM Research Fellowship Scheme, exemption of BCD on cobalt powder & lithium-ion battery waste

The Union Budget 2025 was subject to several announcements, as Minister of Finance, Nirmala Sitharaman, delivered a keynote speech at the Parliament on February 1. The core focus of the budget was directed at extending critical support to four core areas, agriculture, MSME, investments, and exports, favourably impacting a holistic growth roadmap through meaningful announcements. The Union Budget prioritized making essential announcements and reforms in agriculture, Artificial Intelligence (AI), upskilling, manufacturing and sustainable development, providing a progressive perspective on the GOI’s strategic blueprint for the upcoming financial year. Furthermore, the announcements and reforms also marked a watershed moment for India’s comprehensive emphasis on sectoral growth, and corporates welcomed the approach with both hands.

Moreover, a renewed push for AI-driven automation and deep-tech innovation ensures that Indian startups remain at the forefront of global technological advancements.

The Budget also provides a big boost to cleantech. India has already positioned itself as one of the highest EV-adopting countries in the world, and the announcement of the National Manufacturing Mission’s support for clean tech manufacturing at the Union Budget is expected to be a game changer. The Union Budget 2025 prioritizes sustainable mobility in the country with the removal of Basic Customs Duty (BCD) on critical materials like cobalt powder, lithium-ion battery waste, and other essential minerals. This move has been further supported by an additional INR 10,000 crore investment in the Union Budget, highlighting innovation, job creation, and energy security. 

The Tech Panda asked what industry players thought of the Union Budget 2025 allocation when it came to tech.

Siddharth Tipnis, Partner and Technology Sector Leader, Deloitte India

“For India to lead the future with disruptive innovation, it is imperative to intensify spending on Research & Development (R&D). Nations that have been at the forefront of technology and innovation allocate anywhere between 3–5% of GDP toward R&D. The government’s renewed focus on innovation and R&D, with a INR20k crore allocation toward the PM Research Fellowship Scheme (for 10,000 fellowships in technology research at IITs and IIScs) and the Deep Technology Fund of Funds, is expected to provide a much-needed impetus. This is expected to result in greater private sector–academia collaboration toward technology-led innovation from India.

Girish Hirde, Global Delivery Head, InfoVision

“We appreciate the Union Budget 2025 announcement and believe that it balances that aspirational, futuristic growth with overall infrastructure development in the nation. The announcement of a Deeptech Fund of Funds to support technological advancements, while providing 10,000 Fellowships for tech research in IITs and IISc, under the PM Research Fellowship Scheme, is going to play a pivotal role in building national capabilities in the field of Deeptech & research. This, coupled with the establishment of Centre of Excellence for AI in Education, established with an outlay of INR 500 CR will prove to be another significant boost for indigenous capabilities and prowess. At InfoVision, we commend these developments and look forward to supporting India’s evolution as a global leader in Deeptech & AI.”

AUTOMOTIVE

Sandeep Aggarwal, Founder & CEO, Droom

“We commend the Finance Minister for coming up with a forward-looking budget and believe that it is focused on driving inclusive growth, giving a boost to India’s burgeoning MSME & Start-up sector. We particularly appreciate the expanded scope and fresh contribution of INR 10,000 CR as part of the “Fund of Funds” for start-ups. This is a huge step, when seen in the context of funding winter for start-ups and will certainly boost the entrepreneurial sentiment in the country. This development, coupled with establishment of Centres of Excellence for Skilling and AI, will further enable the next wave of entrepreneurship in the country. At the same time, the budget also recognised the contributions of MSMEs, enhancing credit access and facilitating tech upgradation. At Droom, we look forward to supporting the government’s key undertaking towards making India a global hub for manufacturing and innovation.”

SUSTAINABLE MOBILITY & ELECTRIC VEHICLES

Madhumita Agrawal, Founder & CEO, Oben Electric

“The Union Budget 2025 is well balanced, in terms of supporting India’s aspirations of emerging as a global hub for tech and innovation, while supporting MSMEs – the nation’s backbone, and creating more job opportunities for the nation’s youth. Investments in Clean Tech will certainly give a boost to the EV sector. Exemption of basic customs duty on Cobalt Powder and lithium-ion battery waste, and including 35 additional capital goods for EV manufacturing, will give a significant push to indigenous manufacturing. This will not only ensure easy availability crucial, also boosting domestic manufacturing and creating more job opportunities for the nation’s youth. At the same time, the budget also has key provisions for boosting the next wave of entrepreneurship in the nation, including the New Fund of Funds with a fresh contribution of INR 10,000 crore is a welcomed move, following the funding winter & dry spells that entrepreneurs had to endure in the previous year.”

Siddharth Patel, Founder, Greenway Mobility

“India’s push for sustainable mobility is getting a major boost with the removal of Basic Customs Duty (BCD) on critical materials like cobalt powder, lithium-ion battery waste, and other essential minerals. This bold move will lower manufacturing costs, ensure a steady supply of key resources, and accelerate the adoption of electric vehicles. More importantly, it paves the way for stronger domestic production, job creation, and advancements in battery technology, a key step toward a cleaner, more energy-independent future.”

“At the same time, the National Manufacturing Mission is set to transform India’s green energy landscape. By backing local production of EV batteries and solar panels, the initiative will reduce import reliance and make sustainable solutions more accessible. The government’s additional INR10,000 crore investment signals a strong commitment to innovation and economic growth, strengthening India’s position as a global leader in clean technology.”

Dinesh Arjun, CEO Cofounder, Raptee.HV 

“Innovation and technology are the cornerstones of every developed nation, and India’s vision for Viksit Bharat rightly prioritizes these pillars. The Finance Minister’s focus on nurturing and investing in innovation is a commendable step toward accelerating new technologies that will shape our future. The allocation of a Deep Tech Fund will further strengthen India’s industrial ecosystem, fostering a globally competitive, tech-driven economy.

“A crucial boost to the EV industry comes with the exemption of Li-Ion batteries and other capital goods, which will significantly reduce battery costs and encourage further investment in domestic battery manufacturing. Given that batteries make up 30-40% of an EV’s cost, this move will make EVs more affordable and accessible to consumers, driving mass adoption across two-wheelers, three-wheelers, and four-wheelers alike. By addressing a fundamental cost barrier, this initiative lays a strong foundation for the future of electric mobility in India. We are confident that these strategic measures will have a lasting positive impact on the EV ecosystem in the months to come.”

CLEANTECH

Divyesh Savaliya, Chairman & MD, Onix Renewable Limited

“The Union Budget 2025 has set the stage for the self-reliance-led growth in the country’s renewable energy sector in line with the goal to achieve 500 GW of non-fossil fuel energy by 2030. With a strong emphasis on domestic value addition, the government’s focus on solar PV cells, EV batteries, motors, and controllers will significantly reduce reliance on imports and foster self-sufficiency in critical clean technologies. The introduction of the National Manufacturing Mission to support domestic production of EV batteries and solar panels is a strategic move that will not only enhance India’s manufacturing capabilities but also drive cost efficiencies, supply chain resilience, and global competitiveness.

“By encouraging backward integration and technology-driven advancements, these measures will catalyze innovation, attract investments, and create a robust ecosystem for clean tech manufacturing. As India moves towards its net-zero goals, such initiatives will play a crucial role in accelerating renewable energy adoption, ensuring energy security and diversifying the renewable energy portfolio.”

Dr. Bijal Sanghvi, Managing Director, Axis Solutions

“Union Budget 2025 will drive and strengthen India’s manufacturing and energy transformation with a strong push for “Make in India”. Targeting 100 GW of nuclear energy by 2047 is a welcome move for a sustainable future. With a ?20,000 crore outlay for small modular reactors in Nuclear Power, the budget accelerates clean energy adoption. Power sector reforms, export promotion, and policy incentives will strengthen industrial growth, ensuring Atma-Nirbharta, innovation, energy security and transition.  Investing in people through skill development programme will build a future-ready workforce, positioning India as a global power- house in manufacturing, sustainability, and technological advancement.”

Vasudha Madhavan, Founder & CEO, Ostara Advisors

“Great news for India’s Clean Energy efforts! Nuclear energy for civilian energy needs got a big boost in the Union Budget 2025. A comprehensive Nuclear Energy Mission has been launched, with an allocation of Rs. 20,000 crore, and with an ambitious target to develop 100 gigawatts (GW) of nuclear power capacity by 2047. To aid Private Sector participation and boost R&D in this space, capital has been allocated to promote innovations like Small Modular Reactors (SMRs), with a target to operationalize at least 5 indigenously-built SMRs by 2033. To make this central to our Energy Transition efforts as a nation, the government could mandate the power ministry to handle civil nuclear power generation rather than the Department of Atomic Energy”.

GEOSPATIAL SECTOR

Swayambhu Mohanty, Co-Founder, Airace

“The Union Budget 2025 has laid a strong foundation for accelerating India’s digital transformation, particularly in geospatial technology, precision infrastructure, and deep tech innovation. The announcement of the National Geospatial Mission is a pivotal step toward modernizing land records, enhancing urban planning, and driving large-scale infrastructure projects using advanced geospatial data. This initiative aligns perfectly with our mission at Airace Technologies to democratize high-precision GNSS solutions for industries ranging from construction and surveying to agriculture and smart cities.  

“Additionally, the Deep Tech Fund of Funds, aimed at catalyzing the next generation of technology-driven startups, is a significant boost for companies like ours that are leveraging AI, machine learning, and advanced GNSS analytics to revolutionize the industry. The government’s commitment to fostering research, development, and innovation—backed by a INR20,000 crore allocation—further strengthens India’s position as a global technology leader.  

“The integration of PM GatiShakti’s data access for private sector innovation is another forward-thinking move, enabling more efficient project planning and execution. This will directly impact industries relying on precise positioning and navigation technologies, allowing for better decision-making and cost optimization. Moreover, the ‘Make in India’ incentives for electronics manufacturing, particularly for components essential to GNSS and precision technology, will support the localization of high-quality geospatial hardware, making India self-reliant in this critical sector.”

AGTECH

Dr. Renuka Diwan, Co-founder & CEO, BioPrime

“The National Mission on High Yielding Seeds will bolster agricultural resilience by developing and promoting seeds that are high-yielding, pest-resistant, and climate-resilient. The emphasis on leveraging advanced science and technology, coupled with the Deep Tech Fund of Funds, will catalyze next-generation innovation in agri-tech, paving the way for a self-reliant and nutritionally robust nation. The enhancement of investment and turnover limits for MSMEs by 2.5 times and 2 times, respectively, is a strategic move to empower these enterprises to scale up, innovate, and generate more employment opportunities for the youth.”

FINTECH

S Anand, Founder & CEO, PaySprint

“The Union Budget 2025 brings a host of promising developments for the fintech and financial services sector, and I am encouraged by the government’s continued commitment to innovation and financial inclusion. The budget’s focus on improving access to financial services in remote areas, along with a clear emphasis on expanding digital infrastructure, will drive fintech adoption, especially in underserved regions. With 1.7 crore farmers and over 100 districts being targeted for financial and technological upliftment, this will further facilitate the reach of fintech solutions.

“A key highlight is the renewed focus on regulatory responsiveness under the FSDC framework, creating a more agile and business-friendly ecosystem that empowers fintech players like PaySprint to accelerate digital banking adoption and drive financial inclusion across Bharat. The decriminalization under the Jan Vishwas Act 2023 is a game-changer, removing legal complexities and making it easier for startups and MSMEs to grow. Strengthening Central KYC (CKYC) will further streamline compliance, reduce redundancies, and improve financial access. The commitment to digital public infrastructure, including a new international trade financing platform, alongside INR10.18 lakh crore allocated for capital expenditure, will bolster fintech capabilities in delivering secure, efficient, and scalable financial services. With financial sector reforms driving data-driven governance and a fiscal deficit reduction target of 4.4% of GDP by FY26, these initiatives provide a stable environment for fintech firms to thrive and position India as a global financial leader. At PaySprint, we are excited to leverage these policy-driven advancements to build smarter, more inclusive financial solutions, ensuring businesses—big and small—can grow and succeed in this evolving ecosystem.”

IT & HRTech

Pradyumn Sharma, CEO, Pragati Software

“The 2025 Union Budget marks a defining moment for India’s digital economy, with a clear focus on AI, deep tech, and workforce skilling. The allocation of ?500 crore for a Centre of Excellence in AI for Education and the continued investment in AI-led research and skilling programs signals a strong push towards preparing India’s workforce for the future. At Pragati Software, we see this as a transformative opportunity to further bridge the gap between emerging technologies and industry-ready skills.  

“The Deep Tech Fund of Funds and ?20,000 crore investment in private-sector-led research and innovation are crucial steps that will accelerate advancements in AI, automation, and cloud computing. This directly impacts corporate IT training, as businesses will now need to upskill employees to harness these cutting-edge innovations. Additionally, the announcement of five National Centres of Excellence for Skilling reinforces the government’s commitment to equipping professionals with the expertise needed to thrive in a rapidly evolving tech landscape. As a company deeply invested in corporate IT education, we are excited to align our training programs with these national priorities, ensuring India’s workforce stays ahead in the global digital transformation race.  

“This budget recognizes that the future belongs to those who can adapt to AI, data-driven decision-making, and emerging digital technologies. We look forward to playing a key role in this transition, empowering organizations and individuals with the knowledge they need to excel in the next era of technological evolution.”

IoT

Jani Vehkalahti, SVP, Smart Grids, Wirepas

“The Union Budget 2025 marks a significant step towards transforming India’s digital and IoT landscape. The government’s continued focus on strengthening digital infrastructure and promoting sustainability will play a crucial role in accelerating growth in the technology and IoT sectors. With INR10.18 lakh crore allocated for capital expenditure and the introduction of digital public infrastructure for international trade, we expect to see enhanced connectivity and infrastructure, which will support the proliferation of IoT solutions across industries.

“The budget’s emphasis on financial inclusion and expanding connectivity in rural areas is especially encouraging. This will enable the adoption of IoT solutions in sectors like agriculture, energy, and manufacturing, which will benefit from increased access to affordable and reliable connectivity. The proposal to extend the Liberalized Remittance Scheme (LRS) and increase the TCS threshold to ?10 lakh will also encourage global partnerships, further positioning India as a hub for tech innovation. Additionally, the government’s commitment to green technology and sustainability, including tax incentives for clean energy and sustainable manufacturing, aligns with the IoT sector’s growing role in driving energy efficiency and smart solutions. This will accelerate the adoption of smart meters, smart buildings, and asset-tracking technologies, helping to improve operational efficiency while reducing energy consumption. The focus on technology and sustainability presents exciting opportunities for the IoT sector to contribute to India’s vision of a digitally inclusive, connected, and sustainable future.

OTT & Entertainment

Kaushik Das, Founder & CEO, AAO NXT

“The Union Budget 2025 brings a wealth of opportunities for India’s OTT and entertainment sectors, with significant investments aimed at enhancing digital infrastructure. The allocation of ?10.18 lakh crore for capital expenditure will drive connectivity across urban and rural areas, enabling OTT platforms to reach wider audiences. The government’s emphasis on digital literacy and financial inclusion will also help expand access to streaming services, fostering the growth of regional content and increasing viewership across the nation.

“With a strong focus on 5G technology and digital public infrastructure, the budget lays the groundwork for more interactive, high-quality content delivery. These measures are set to benefit OTT platforms by improving streaming quality and enabling new forms of content consumption, such as augmented reality and virtual reality. Additionally, the government’s initiatives to support content creation through tax incentives will stimulate more investment in original, diverse content, providing a significant boost to the Indian entertainment ecosystem.

“The budget’s commitment to sustainability and green technology aligns with the global shift towards eco-friendly media production. As internet connectivity improves, OTT platforms can enhance user experience and deliver seamless services across a larger geographic area. With these reforms, India’s OTT and entertainment industry is poised for growth, with greater access, diverse content, and a future-driven infrastructure that will redefine how we experience digital entertainment.”

ESPORTS

Shiva Nandy, Founder & CEO, Skyesports

“India’s gaming industry is on an exponential growth trajectory, and we are still only scratching the surface of its full potential. Initiatives like the Deep Tech Fund of Funds could present a significant opportunity to fuel homegrown innovation, supporting the creation of world-class games and esports titles from India. Coupled with the National Centres of Excellence for Skilling and the government’s focus on AI-driven innovation, we are poised to see a new wave of highly skilled professionals who can drive Indian gaming further on the global stage.

Additionally, the tax relief for India’s middle class—our primary consumers of esports—will enable more discretionary spending on entertainment, further accelerating industry revenues. With India’s ARPU for midcore and hardcore games on the rise, initiatives like these will serve as catalysts, propelling the sector into its next phase of growth.”

SPACE

Divya Kothamasu, Founder, N Space Tech

“The announcement of the National Geospatial Mission in the budget signals a forward-thinking approach to nation-building, where data-driven insights will power smarter cities, efficient infrastructure design, and transparent land management systems. By creating foundational spatial infrastructure, this mission will foster unprecedented innovation opportunities for startups, enabling them to solve complex urban and rural challenges with geospatial intelligence.

“The expanded INR10,000 crore Fund of Funds and enhanced credit guarantees for MSMEs show a strong commitment to empowering entrepreneurship and technological innovation. When combined with the emphasis on AI education and R&D investments, these initiatives position India to lead in the next wave of deep-tech advancements, setting the stage for a thriving, knowledge-driven economy.”

WEB3 & CRYPTOCURRENCY

Shivam Thakral, CEO, BuyUcoin

“The Union Budget 2025, presented today, has left the Web3 sector with mixed feelings. While there were no specific announcements addressing the unique challenges faced by this innovative space, the Finance Minister’s commitment to rationalizing tax deduction at source (TDS) is a step in the right direction. Reducing the number of rates and thresholds for TDS can enhance clarity and compliance for businesses operating within the Web3 ecosystem.

“Furthermore, the establishment of a committee to review reforms aimed at improving the ease of doing business is promising. This initiative could lead to streamlined regulations that are crucial for attracting investments in startups, including those in the Web3 domain. The proposed ‘Fund of Funds for Startups’ and extending the incorporation period for startups to five years signal a supportive environment for entrepreneurship.

“However, we urge for more decisive action regarding taxation and regulatory frameworks to foster growth in Web3. We at BuyUcoin believe that clear guidelines are essential to reduce uncertainties and encourage both domestic and international investments. Together, we can pave the way for India to become a global leader in digital assets.”

Sumit Gupta, Co-founder, CoinDCX

“Unfortunately, there is no relief to the crypto industry in the Budget 2025. We were hoping for at least some amendments to create parity between tax-compliant VASPs and non-compliant offshore exchanges. Despite providing the government with ample justification regarding the ambiguity in the language of the current TDS Section 194S, the concerns around Indian wealth being shifted offshore and the significant loss to the tax exchequer have been overlooked. International exchanges should be obligated to the same 1% TDS as compliant Indian exchanges. As a compliant company, we are disappointed.

“Moreover, there are some provisions aimed at achieving individual tax compliance for VDA investors, which will likely lead to more compliance burdens on domestic exchanges that are already adhering to the regulations.”

Prashant Bora, MD & CEO, OTEK (A Bora Multicorp Venture)

“The FM’s proposal to reduce of the customs duty on open cells and other critical electronics components to 5% will help boost the Make in India initiative. This will help electronics brands to support customers with more cost-effective pricing, leading to enhanced scalability and growth. Furthermore, the budget’s emphasis on positioning India’s aspirations to become a global electronics hub through the production-linked incentive (PLI) schemes for electronics and IT hardware manufacturing, further boosted by PM Narendra Modi’s target of $500 billion by FY30, coupled with the government’s bid to strengthen India’s startup ecosystem with an additional INR 10,000 crore Fund of Funds will be a catalyst for growth going forward.”

SEMICONDUCTORS

Rajendra K Chodankar, Chairman & CEO, RRP Electronics Ltd.

“The Budget has proposed a significant increase in allocation to MeitY by 48% to Rs. 26,000 crore which includes subsidies for semiconductor also. The welcome move by the Government to promote compound semiconductors is also very heartening and will indeed take India beyond horizons. We are very confident that Government of India will announce Semiconductor Mission 2.0, which will boost the sector and put India on World map. I am very confident that in the changing dynamics of the World, Indian Semiconductor players like us and the others are going to play a major role and the unstinted support by Government of India and State of Maharashtra is very pivotal in the short to long run.”