Budget 2024: AI R&D Set for Significant Boost

Learn how AI R&D will get a big boost from budget 2024

India is presently undergoing a critical time of technical growth, with artificial intelligence (AI) and generative AI (Gen AI) creating worldwide waves. As the country prepares to imprint itself on the global scene, this year's budget, albeit interim owing to general elections, has enormous promise for the Indian technology sector.

Finance Minister Nirmala Sitharaman will submit the interim AI R&D budget on February 1, 2024, and the full budget for fiscal year 2024-2025 will be tabled once the new government takes office following the June general elections.

Reflecting on 2023, Binod Singh, CEO and creator of Cross Identity, recalled the key year of FY2024, when the government allocated over Rs 600 crore to develop a comprehensive and secure digital infrastructure. As FY2025 approaches, Singh predicts an increase in allocation of 30 to 50%.

Furthermore, Singh anticipated the renewal of important multi-year technology projects and contracts, potentially increasing spending by 80%.

Similarly, Prerna Kalra, co-founder of Daalchini Technologies, expressed her need for specific funding programs, cheaper interest rates, and collateral-free loans. She emphasized the importance of tailoring these activities for women, considering their lesser engagement in the digital sector. According to Kalra, providing targeted incentives and allocations might result in a revolutionary shift in the existing situation.

According to a Forrester estimate, IT investments would increase by 5.3% in 2024, up 3.5% from the previous year. With such an increase in expenditures, total global tech spending will hit a peak of USD 4.7 trillion. According to the survey, technology spending in Europe and North America is predicted to expand by 5.1% and 5.7%, respectively.

Asia-Pacific, led by India, the Philippines, Vietnam, Indonesia, Malaysia, and China, would expand at a pace of 5.7%.

What to Expect from AI Funds

Last year, AI was finally included in the Union Budget, with an allocation of Rs 2,000 crore to the National Research Foundation (NRF), a positive step towards the vision of 'Make AI in India' and 'Make AI work for India', which aims to energize a powerful AI ecosystem and nurture top human resources.

In light of this set norm, Anjan Pathak, CTO and co-founder of Vantage Circle, stated that he looks forward to the Centre's continued support in the AI effort, which will play a critical role in molding the nation's growth and advancement.

Cross Identity CEO Binod Singh highlighted the growing concerns about disinformation and the possible exploitation of cutting-edge technologies. He anticipated allocating Rs 500 crore to address digital hazards completely, emphasizing the critical need for ethical AI adoption across several areas.

"In the Union Budget 2024, the Indian government must prioritize AI integration in education to align with the National Education Policy (NEP) 2020," remarked Vineet Nayar, former CEO of HCL Technologies and Founder and Chairman of Sampark Foundation.

The Central Focus of R&D

The use of AI for technical improvements is fueling high expectations for the Union Budget 2024. However, this might only be accomplished if technological research and development (R&D) remains a top priority. Unlike last year, when AI Centres of Excellence (CoE) in top educational universities were highlighted, this year's majority is inclined to invest more in technological research and innovation.

Ritesh Chopra, Sales Director, India and SAARC Countries at Gen, stated, "In light of the evolving digital threats, we advocate for substantial investments in continuous research and development to stay ahead of emerging threats."