Govt. to encourage domestic hardware sector

By Our Special Correspondent

NEW DELHI, JAN. 28. The Government is working on removing ``procedural wrangles'' to give an impetus to the computer hardware sector. ``We are trying to make things easy,'' the Information Technology Secretary, Mr. Jayakrishnan, said, admitting that the hardware sector was lagging behind software.

The IT Secretary felt that factors other than the duty structure were responsible for the poor show by Indian companies. These included intense competition among MNCs, leading to low margins of three to five per cent and quick changes in technology. ``It is not just duties,'' he emphasised.

Pointing out that 53 per cent of the computers sold in the country were from the ``grey'' market as against 25 per cent manufactured legitimately in the country, he said, `` We are looking at that now.'' He did not provide any details though.

Speaking to presspersons here today, he admitted that the Government was committed to encouraging the domestic hardware sector. The penetration of PCs had to reach 20 per 1,000 persons by 2008 from the present negligible levels if the country was to fulfill the potential of making the software sector a $ 50 billions industry by then as stated in a McKinsey & Co. report.

Mr. Jayakrishnan and other officials were speaking to presspersons to announce the holding of an exhibition-cum-seminar show-casing MIT-sponsored technologies. It will be inaugurated on January 31 and the Principal Scientific Adviser to the Prime Minister, Dr. A.P.J. Abdul Kalam, is scheduled to deliver the key note address.

Asked if the software sector should be asked to contribute to the Exchequer by way of taxes since it was performing well, Mr. Jayakrishnan said the Government ``wouldn't like to do anything to curb its growth''. He said the onus was on the Union Finance Ministry since his Ministry had already submitted its suggestions in this regard.

On the pending Bill on Information Technology, Mr. Balakrishnan said that as budgetary implications were occupying the Government's attention, it would be addressed in the Union Budget scheduled to be presented after a month. The Government was also assessing the need to make procedural and legislative changes in the Bill.

Mr. Jayakrishnan was confident of the IT Bill being introduced in the coming session of Parliament. Giving a low-down on the status of the Bill, he said it was being vetted by the Parliamentary Standing Committee. ``We want a good deal of deliberation because of its complexity and have, therefore, posted it on a website and despatched it to industry associations for feedback. It may be cleared during the Budget Session.''

Official sources ruled out granting the infrastructure status to the software sector as was suggested by the Minister of Information technology, Mr. Pramod Mahajan. It was argued that such a step was not required because the Government had given a large number of concessions as suggested by various ``task forces'' and some more were in the offing once the Group on Telecom submitted its report.

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