According to reports, in its budget wishlist, India's leading IT trade association, Nasscom, has pushed for changes to safe harbour regulations and expanded access to SEZ reinvestment funds. It has also pushed for the establishment of a federal deeptech fund to support the country's startup scene.

The establishment of a grant framework for the deeptech ecosystem and allowing employees of all DPIIT-recognized businesses to postpone the payment of taxes on their Employee Stock Option Plans rank highest among the industry's budget expectations.

On February 1, 2025, Finance Minister Nirmala Sitharaman is expected to propose the Union Budget for fiscal year 2025–2026 to Parliament.

The budget for India's $250 billion export-driven IT sector comes as the country continues to face global macro challenges, geopolitical threats, and mounting anxiety over the potential for abrupt policy and tariff changes by the US, where President Donald Trump has pledged to write a new, glorious chapter for America during his eye-catching second term.

Nasscom's budget estimates are heavily influenced by issues related to the transfer-pricing regime, extending the reach of the SEZ reinvestment reserve for tech enterprises, and initiatives to support startups in India.

One of the main requests is to allow employees of more startups to postpone the Employee Stock Option Plan (ESOP) tax payment period.

The deferment - even if you look at only DPIIT-registered startups - is actually available only to about 2.5 per cent of these startups.

"A common grant framework should be established across government ministries, through a two-tiered funding approach - Initial Proof of Concept grant of at least Rs two crore to validate core technologies; tested Prototype grant of minimum Rs. 3 crore to support market validation and early commercialization," according to NASSCOM.

The industry asserts that since Global Capability Centres (captive centres) only provide services to their own group companies/parent companies and are normally based on a cost-plus model, the safe harbour rules should be available to all the GCCs and the cap on turnover (up to Rs 200 crore) and the criterion of bearing insignificant risk needs to be dispensed with.