HYSEA irked at non-implementation of incentives for IT sector

By Our Staff Reporter

HYDERABAD, MAY 20. While the Chief Minister, Mr. N. Chandrababu Naidu's announcements and the Information Technology (IT) Secretary's attempts to implement the incentives for the IT sector are seen as being `positive', their non-implementation by other Government departments has irked the Hyderabad Software Exporters Association (HYSEA).

The State Cabinet Sub-Committee on incentives to software industry, which was constituted in February 1999, submitted its report in April 1999 and the Government issued orders in May 1999 itself covering concessions and incentives under 16 heads.

But, even after a year, 12 of the 16 incentives are yet to be implemented, according to Mr. A. Mallikarjuna Rao, secretary, of the association.

Giving details at a press conference here on Saturday, Mr. Mallikarjuna Rao, was cautious and sought to distinguish between the `positive' attitude of Mr. Naidu and the IT Secretary, and the `negative' attitude of other departments involved in their implementation.

Mr. Rao said only two incentives were officially implemented--those relating to exemption from seeking a Pollution Control Board certificate and from sales tax. In two more cases--relaxation of zonal restrictions and rebate on cost of land--though the concerned departments are yet to issue instructions, they are `observed' in practice.

Two more issues relate to power cut exemption and treatment of IT on a par with industry for application of power tariff. The AP Transco issued orders for subjecting IT to industrial tariff (instead of commercial) but this has not been implemented so far. This would make a difference of about 30 per cent in power bills for the IT companies, he said.

The 12 incentives not implemented relate to various provisions and exemptions like the Factories Act, Employment Exchange (notification of vacancies) Act, Payment of Wages Act, Minimum Wages Act, Contract Labour Act, Workmen's Compensation Act, A.P. Shops and Establishments Act, Employees State Insurance (ESI), the issue of three shift operations, rebate on cost of land, rebate on registration and transfer of property charges.

Mr. Rao said in several of the cases, more than the money involved it was the cumbersome procedures and `harassment' by department people that the IT sector wanted to avoid. Pending implementation, some of the departments were issuing `notices', he said. For example, those engaged in IT Enabled Services were facing harassment from the Labour Department (on issue of three shift operations).

Mr. Rao announced the formal launch of HYSEA's website (www.hysea.com), which has information regarding HYSEA and related activities. Over time, they would like to develop it into a portal, he said.

Mr. J.A. Chowdary has been elected president of the new HYSEA body for 2000-2001. While Mr. Mallikarjuna Rao has been reelected secretary. The other office-bearers are: Mr. Devashish Ghosh (senior vice-president), Mr. L.N. Acharyulu (vice-president), and Mr. K. Krishnam Raju (treasurer).

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