Efforts to forge Govt.-IT industry partnership

By Our Special Correspondent

NEW DELHI, JAN 10. The high profile IT Advisory Group to the Union Ministry of Information Technology will hold its first meeting after a year on January 15. The meeting will be taking place against the backdrop of acceptance of most of the software industry's demands in the last Union Budget, passage of the IT Act and unfulfilled expectations by the industry in the social sphere.

Official sources said most members to the committee including top names like Mr. Azim Premji, Mr. Narayana Murthy, Mr. Ramalinga Raju, Mr. Subhash Chandra, Mr. Rajeev Chandrashekhar, Mr. Satish Kaura, Mr. S. C. Kohli and Mr. Dewang Mehta might attend the meeting to be chaired by the Union Minister of Information Technology, Mr. Pramod Mahajan. Their presence at the meeting may be guaranteed more by the fact that most of them will be in town to attend a dinner on the occasion of the maiden visit to the country by IT visionary and Cisco CEO, Mr. John Chambers.

Rather than listening to the industry's wish list for the coming Budget, the official side is more keen on getting feedback on several major issues. These include framing of rules that will allow the use of digital signatures, promoting the use of local language software and e-governance and its role in promoting the Government's desire to promote IT among the public at large. The Government would also want to know how the industry's intends to diversify its activities in light of the acknowledgement by Mr. Chambers of an impending slowdown in the software sector.

As the year 2001 has been declared as the ``Year of the Hardware Sector'', the Government will want to know the industry's views on the tariff structure, availability and cost of finance, availability of capital goods and the velocity of business.

There is also considerable anxiety over the massive investments made by China in the hardware sector. The industry, on the other hand, is equally keen to know whether the Government intends taxing some areas such as e-commerce where the software industry has considerable stake and interest. But more than assuaging the industry's areas of concerns, the Government will be more keen to know how an effective Government-industry partnership could be forged in bridging the digital divide and ensuring equitable diffusion of information technology across the entire economic spectrum

Officials feel the industry has got more than it desired in the last budget and the time had come to address the challenges, in the social sphere as well as overseas markets. In the last budget, the Government had exempted income by dividend and long term capital gains made by venture capital funds (VCFs) by investing in the software and IT sectors. In order to give a thrust to VCF activity, the Securities and Exchange Board of India was made the nodal registering authority. GDR norms were liberalised and IT enabled services became eligible to claim tax benefits.

Although the import duty on computer peripherals was reduced from 20 to 15 per cent, it is believed that this sector requires many more incentives to make it vibrant. Most major analyses in the recent past have painted a dismal picture of the domestic hardware sector and urged the Government to take a pro-active role. But in an advisory council packed with achievers from the software sector, the initiative in this regard may have to come from the Government.

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