A Government’s Point of View on blockchain: Indian State of Telangana …


Amidst rumors about The Government of India’s negativeness about cryptocurrencies, one Indian State has been taking massive steps in adopting Blockchain Technology. 

The Government of the State of Telangana, India, has published a Blockchain policy draft outlining their vision and regulation guidelines to support blockchain startups based in Telangana.

Altcoin Buzz tries to summarise the 14-page document, titled, “Blockchain Policy”, and discusses its major points

Vision

To make Hyderabad, the capital city of Telangana, as one of the top 10 Blockchain Cities of the world. Hyderabad has an edge because of the below reasons:

  • A critical mass of industries leveraging blockchain technology is located in Hyderabad (financial services, insurance, pharmaceuticals, and life sciences, supply chain and logistics, etc.)
  • Access to talent
  • Support of entrepreneurship
  • Collaboration with enterprises

The anchor: India’s first Blockchain District

India’s first ‘Blockchain District’

  • Will be a physical area within Hyderabad
  • Will house all major blockchain technology companies
  • Will have a huge incubator and a world-class facility for promoting research, innovation and industry collaboration
  • This one of its kind initiatives will aim to put all blockchain companies based out of Hyderabad at a strategically advantageous position globally

4 main pillars

Developing Talent Pool

  • Telangana Academy for Skill and Knowledge (TASK) will deliver blockchain courses to engineering students in the state.
  • Re-skilling and up-skilling of the existing workforce for future demand.
  • An elite certification program will be run in collaboration with the industry players with placement prospects for select few techies.
  • Internships to students who may secure a preplacement offer at the end of the internship.
  • The State will encourage technology institutions in Telangana to add blockchain in their curriculum.
  • Public enterprises and government agencies will undergo workshops launched in blockchain technology to facilitate better adoption within the government.
  • Educational workshops and conferences will allow practitioners and experts to provide specific insight and illustrate the practical application and foster innovation through hackathons, national challenges, boot camps, and accelerators.

Supporting Infrastructure

  • The government will provide office space to house all the blockchain start-ups, co-working and incubation spaces at highly subsidized prices
  • A sandbox for prominent blockchain protocols will be created that will allow simulation and prototyping of solutions.
  • An international liaison office will be created to bring in investments.
  • IT infrastructure facility for the provision of cloud-hosted computing and storage through T-Cloud will be extended at subsidized rates.

Promoting Research and Innovation

  • Universities and technical institutions of Telangana will build partnerships with the technology companies to undertake research and build solutions and skills supporting the future initiatives of the private and public sector.
  • Encourage immigration of talent to the state:
    • Start the research fellowship
    • Collaboration with international start-ups/companies and encourage such companies to open their offices in the state.
  • The government will fund research programs in blockchain technology by setting up research chairs in select premier institutes and fund research scholars working in the domain.
  • Facilitation of researchers at the flagship annual blockchain event.
  • Organize an annual academic conference for all Blockchain researchers in the state to showcase their work.

Enabling Collaboration and Building Community

  • The government will run strategically designed awareness programs to provide education on Blockchain.
  • Government plans to provide blockchain communities with necessary infrastructure and sponsorship for meetups/gatherings/events.
  • Create compelling success stories on all the relevant public/private projects within the state and showcase them in global blockchain conferences/events.
  • The government will organize an annual event every year.
  • The government will launch a virtual community.
  • Pursue membership with industry organizations and blockchain consortiums at national and international levels.
  • Conduct seminars, workshops, and lectures by renowned industry leaders and technologists in this area to mentor start-ups and talent pool.

Implementation Plan: Focus Areas of the State

The Telangana State will take up a tailored approach based on potential and maturity of the specific industry. The sectors under focus are provided below:

The State has been at the forefront in piloting or implementing various use cases in securing certificates, land records and microfinance area. New use cases will be identified in areas such as voting, financial transactions between the government agencies and citizen or contractors, supply chain visibility in agriculture and citizen registration that can have a high impact on some of the systemic problems faced.

Incentives:

In addition to the incentives mentioned in the Government’s IT/ITeS and Innovation Policy, the following incentives shall be provided to companies developing blockchain products and delivering blockchain services:

Incentives to Enterprises

  • 25% subsidy on lease rentals up to INR 5,00,000 per annum for the first 3 years of operations
  • 50% subsidy on the exhibition rentals for the SMEs (firms operating out of Telangana) participating in national or international exhibitions limited to 9 Sq. mts of space
  • A tailor-made incentive package will be provided for mega blockchain projects or marquee blockchain companies.
  • The land will be allotted at subsidized rates
  • For all the research projects sponsored by companies in technical universities, an equal amount of investment will be made by the govt. for up to INR 5 Lakhs per year for the next three years

Incentives to Start-ups

  • 100% reimbursement of State Goods and Services Tax (SGST) for a period of three years to startups with revenues less than INR 5 Crores
  • 75% reimbursement for travel and ticket costs for selected Blockchain conferences across the globe (maximum INR 2 Lakhs per year per start-up in the first 2 years, selected start-ups)
  • R&D grants up to 10% of the R&D expenses or up to 2% of the annual turnover whichever is lesser.
  • One-time start-up grant of INR 10 Lakhs will be provided to a maximum of 10 blockchain startups per year for the next three years.
  • Reimbursement of 50% of the cost of filing patents, subject to a maximum of INR 5 Lakhs.
  • 50% subsidy on the expenses incurred for quality certification limited to a maximum of INR 5 Lakhs
  • 25% reimbursement on internet charges up to a maximum of INR 2.5 Lakhs per year for the first 3 years

Incentives to Other Entities

  • The Government will offer sponsorship of INR 1-25 Lakhs based on the scale, quality, and uniqueness of the event
  • Venues for meetups, gatherings, and small-scale events will be provided at no or subsidized cost

Non-Financial Incentives

  • Firms are exempt from the purview of The Pollution Control Act, except in respect of IT Parks/IT SEZ campuses with built-up areas more than 20,000 sq. mt.
  • Firms are exempt from inspections under multiple Acts and the Rules, barring inspections arising out of complaints.
  • General permission will be provided for three shift operations with women working in the night as these firms provide services to global customers
  • Firms services will be declared as essential services under the Telangana State Essential Services Maintenance Act.



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