Budget 2009 – IT Industry Reacts
Budget 2009 – IT Industry Reacts
- M. Narsimha Rao, President, HYSEA (
The Union budget presented today gives a long term direction to inclusive growth, Infrastructure development, Education and employment generation of 12 Million jobs a year.
In terms of the Impact on the IT industry, steps like the scrapping of the FBT, extension of the 10A benefits till 2011, increase in the MAT credit period to 10 years and increased allocation to education are welcome steps. However, steps like the increase in MAT from 10 to 15% are going to have an adverse impact on the Industry in the short run and this is something we could have avoided.
We believe there are additional steps the Government should consider in the few months to boost the IT industry. These include the extension of the 10A benefit for a period of 5 years(the current extension while it benefits the companies in the short run it doesn’t not lead to new investments to come into the industry), allowing free movement of business between STPI Units and SEZs,and specific incentives to SMEs.
On the personal taxation, while the increases in tax limits are nominal, the removal of surcharge on income tax will benefit number of employees in our industry.
The Industry also welcomes the planned outlay of Rs. 2100 crores to create ‘Educational infrastructure’ including setting up IIT’s and interest waivers for educating students. These reforms will clearly bring in a manifold resource increase for employability in the technical stream. While the Government is taking steps to improve the Quantity & Quality of Human Resources, we believe some incentives for speedier job creation would help in the current global economic scenario.
- Mr. Ramesh Lognathan, MD and VP (Products), Progress Software
The growth targets are very encouraging. I am sure it is partly informed optimism and partly as a desired goal towards which the budget has been arrived at. Infrastructure spending is a good sign. I am sure some of this will also help boost software industry- thru the various IT initiatives likely (by themselves, or to support other infrastructure programs).
Removing FBT is surely a good thing. This was an issue for the software industry where there were a lot of genuine business expenses that was also seen as a fringe benefit. The ambiguity now stands removed.
I would have liked to see some incentives or support to the software sector- particularly SMEs. Specifically either forward looking IP and software products related or at least incentives to encourage the industry to also look inward (domestic markets). This was missing in the overall balanced budget.
About HYSEA
Hyderabad Software Exporters Association (HYSEA) is a registered apex body with more than 300 members representing software industry in AP under the Andhra Pradesh Societies Registration Act.
About Progress Software:
Progress Software Corporation (NASDAQ: PRGS) provides application infrastructure software for the development, deployment, integration and management of business applications. Progress Software India, Hyderabad is the second largest development centre of Progress Software, after the headquarters at
Progress software
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