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V. Rishi Kumar

HYDERABAD, Jan. 4

DESIGNED to suit the current requirements and aimed at attracting companies in the IT-enabled services space (ITES), the Andhra Pradesh Government is in the process of finalising a policy framework for ITES.

With several reports including the the National Association of Software and Service Companies (Nasscom) pointing at increasing role of Indian companies in the business process outsourcing space, the State Government and the IT Department are working with consultants McKinsey & Co to make certain amendments to various enactments including the Indian Labour Act and the AP Shops and Establishments Act, to facilitate the sector, according to Government sources.

While the Chief Minister, Mr N. Chandrababu Naidu, during the last Cabinet re-shuffle, has created a separate Ministry of IT-enabled services which is linked with employment generation in the sector, the Government now plans to bring in a separate enactment to facilitate the growth of the sector.

It plans to provide venture capital funding support particularly to help small companies during this IT downturn. Though the Government has created a VC facility — Hitvel under the Andhra Pradesh Industrial Development Corporation, it is yet to play a significant role.

The new enactment will cover a host of issues including amendment to certain labour legislations, which will facilitate flexible work norms for women employees and cover security related and data protection issues.

The State Government had earlier enlisted the services of consultants — PricewaterhouseCoopers to draw up an integrated IT architecture including issues linked to PKI (public key infrastructure). This was much ahead of the IT Act 2000 legislated by the Central Government.

The earlier framework announced by the Government for the IT sector, which extends flexible registration norms for companies, was linked to the number of employees on roll by the company. Among the new initiatives planned is self- certification to avoid delays. Recently, the State IT Secretary, Mr J. Satyanarayana, had announced Government plans to further boost the sector.

GE Capital, HSBC and Deloitte Consulting are now playing an important role in the sector and the Government is of the view that a policy framework supported by an enabling environment will provide a booster dose for the sector which is now reeling under recession.

Employment opportunities are expected to open up in the sector if more companies are encouraged to locate their facilities. With bandwidth augmentation, the Government expects more job opportunities will be created in the services sector as more companies enter the fray.

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