The Hindu Business Line : More TN sops for ITES sector

THE State Government on Thursday unveiled a policy for the Information Technology Enabled Services (ITES) sector, which it hopes will help the State garner a 20 per cent share of the projected revenues of $21-24 billion by 2008 from this sector for the country.

The State plans to promote Chennai, tier-II and tier-III cities as preferred ITES destinations.

It must be mentioned that the Government had included ITES in the IT policy announced by it in 2002. It is now framing a separate policy for ITES - made up of business segments such as medical transcription, legal database processing, remote maintenance, back-office operations, data processing, call centres, insurance claim processing and business process outsourcing - as it aims to make Tamil Nadu the global ITES capital and attract foreign direct investment in the sector. The ITES sector, the Government believes, has scope to generate employment.

The State's ITES exports increased to Rs 1,636 crore in 2004-05 from Rs 1,000 crore the previous year.

The Chief Minister, Ms Jayalalithaa, unveiled the policy on Thursday at the inauguration of the two-day Connect 2005, a conference-cum-exhibition on the information technology sector organised by the Confederation of Indian Industry.

According to the policy, the ITES industry will continue to enjoy facilities of unrestricted movement of capital equipment, including hardware, peripherals, captive power generation sets, UPS sets and telephone exchanges, subject only to sales tax payments. The Government will offer specific packages to single investments exceeding Rs 300 crore in eligible fixed assets within a period not more than three years from the date of project approval.

Besides, it will give a Rs 25-lakh capital subsidy for investments between Rs 50 crore and Rs 100 crore in eligible fixed assets; a subsidy of Rs 50 lakh for investments between Rs 100 crore and Rs 200 crore; and, a subsidy of Rs 1 crore for investments above Rs 200 crore. A one-time patent registration reimbursement up to 50 per cent of expenses of Rs 1 lakh, whichever is lower, will be given to any production unit in the State. (This set of incentives is available in the IT policy too.)

The policy says the Government shall provide specialised accent training in collaboration with industry and US/UK councils. It will also encourage universities and institutions to create institutional infrastructure for acquiring foreign language skills.

The Government will declare ITES as an essential service and will encourage creation of ITES parks. A rating of the builders through an independent rating agency will be done and land will be given to the builders for developing ITES parks as per the rating.

According to the policy, the Government will formulate a data security and customer privacy act to reassure ITES companies and their customers about the safety of their data.

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