Budget 2018 has clarified that cryptocurrencies like bitcoin are not legal tender in India but finance minister Arun Jaitley expressed support for blockchain technology, which makes cryptocurrencies possible.
Blockchain is a decentralised digital ledger, in which transactions are recorded chronologically. Any changes to the ledger can be seen by all participants, making it hard to tamper with. Jaitley said the government is exploring blockchain technology to usher in the digital economy.
"Segregating the use of blockchain from cryptocurrencies reflects the government's intention to use the technology in a gradual and safe manner, before it gets into concepts like replacing currencies," said Sapan Gupta, national head - banking & finance, Shardul Amarchand Mangaldas. "Capitalising on blockchain could open new ways of securing peer-topeer lending transactions, boosting trade finance, fintech and information repository sectors," he added.
The finance minister also singled out emerging technologies like artificial intelligence (AI), internet of things (IoT) and 3D printing, nudging policy think tank NITI Aayog to start a national programme that will stoke research and result in applications in these areas.
As ET has previously reported, states like Karnataka, Gujarat and Maharashtra, are evaluating blockchain technology for egovernance. Andhra Pradesh is the first Indian state to run pilots on blockchain technology by putting up land records on a public ledger. Jaitley said the Department of Science & Technology will launch a Mission on Cyber Physical Systems to support establishment of centres of excellence. This initiative is aimed to invest in research, and for training and skilling in robotics, AI, digital manufacturing, big data analysis, quantum communication and IoT.
"While Budget 2018 is directionally correct in their approach to digital adoption, adequacy of allocations for digital India, digital education & digital healthcare are a cause of some concern," said R Chandrashekhar, Nasscom president.
However, in a first, the Budget pointed to IEBR (internal- and extrabudgetary resources) worth Rs 5,700 crore towards Digital India. IEBR refers to resources under the Central plan raised by PSUs through profits, loans and equity.