Centre working for 'zero' sales tax on IT products

MUMBAI, FEB. 2. The Central Government is trying its best to convince various State governments to keep sales tax levels at `zero' per cent on IT products to give boost to the sector, the Union Information Technology Minister, Mr. Pramod Mahajan, said today.

To promote India as a `superpower' in knowledge-based technologies, the Government was considering more incentives, and some of them would find place in forthcoming budget, the Minister said while inaugurating the `Nasscom 2000 - India,' an international conference and expo, here.

However, he did not give any details of the budgetary proposals under consideration.

Referring to the present trend of distinguished infotech experts going to developed countries for making IT big there, he said the main objective of his Ministry was to arrest the present trend of braindrain, and facilitate and provide an enabling environment for the brainpower to grow and prosper within the country.

Speed in policy decisions and providing necessary infrastructure were the essential ingredients for accomplishing the nations dream of becoming a knowledge superpower in a decade, he said adding the sector's development should be more broadbased.

At present, about 60 per cent of software exports were by the top 10 companies, and about 25 per cent of exports were by three IT companies in the country, he said.

He said ``in this context of infrastructure building, I ask the political parties not to pose any problems for such projects.''

Indian IT software and services exports will emerge as the largest exporting segment in India in 2003, according to a study conducted by Nasscom.

Making this announcement at the conference, Mr. Dewang Mehta, President, Nasscom, said software exports would cross $20 billion or Rs. 87,000 crores in 2003 which would be almost 23 per cent of India's total exports. Nasscom's projections reveal that in 2003 software exports would have overtaken the current leading export segments of textiles, leather, gems and jewellery as well as engineering.

In 1999-2000, software exports from India are projected to cross Rs. 17,000 crores or $3.9 billion. In this year, software exports would account for nearly 10.5 per cent of the total Indian exports.

However, Mr. Mehta said, in order to achieve $20 billion exports in 2003, many steps would have to be taken by the Government and the industry. This would include the creation of a global telecom infrastructure, simplification of policies and procedures and creation of a venture capital environment.

`India should adopt three-pronged approach'

India should adopt a three-pronged approach - efforts at individual, organisational and national levels - to harness the opportunities provided by the emerging digital economy in the world effectively, Sycamore Networks Chairman, Mr. Gururaj Deshpande, said today.

India should build an enabling environment for the information technology industry to grow by pursuing the cause with strong political determination and build talent pool and required infrastructure, Mr. Deshpande said in his key-note address at the `Nasscom 2000' conference here.

Developing venutre capital funds and reliance on free market economy was also important as industrial growth was not possible without liberal entry and exit norms for corporates, he said.

``Large valuations for silicon valley success stories such as Yahoo, Amazon, Ebay and Priceline.Com are due to the anticipated future business potential of their ideas as perceived by investors, and one should develop such ideas,'' he added.

An individual with entrepreneural skills should develop the ability to dream big and think globally and above all should have the courage of conviction to overcome all odds, Mr. Deshpande said adding it should have team members with global vision with clear objectives.

An organisation should have ability to move fast with team work, focus on core competency, and adhere to norms of transparent governance, he said.

- PTI, UNI

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