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Our Bureau

Bangalore , June 8

The Union Communications and IT Minister, Mr Dayanidhi Maran, has said that the Department of Information Technology supported the demand for extension of incentives under the STPI (Software Technology Parks of India) scheme beyond 2009. The ten-year tax holiday under the STPI scheme will end in 2009 and the IT and BPO industry has made a strong pitch to the government to renew the scheme.

Addressing the Nasscom ITeS-BPO Strategy Summit 2006, Mr Maran said that the benefits offered to the IT sector in other countries should also be studied.

"I want this industry to grow because this is the only industry that can offer a lot of jobs to the Indian youth," Mr Maran said.

While the DIT supports the demand for extension of the STPI scheme by another 10 years, Mr Maran observed that the concurrence of other Ministries would also be required.

He also indicated that certain issues needed to be addressed in this regard.

The minister pointed out that in view of the tax benefits offered under the scheme, the IT sector's contribution to infrastructure improvement was missing. "Let's be practical," he observed.

Nasscom President Mr Kiran Karnik made a strong case for the extension of the STPI scheme. The government's proposed special economic zones wouldn't meet the needs of software companies, especially small and medium ones, Mr Karnik said.

Further Mr Karnik said that the international bandwidth prices were not competitive and stressed the need to bring them down substantially.

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