IT Minister Prasad says first priority is to restore investor confidence

Ravi Shankar Prasad who took charge as the Minister for Communications and IT struck all the right chords on Tuesday saying that his first priority would be to improve investor sentiments and make the functioning transparent.

He also said the focus would be on improving overall quality of telecom service and promoting broadband roll out, especially in rural areas.

Broadband highway Prasad said that he believed in soft touch regulatory approach in taking the sector to new heights. “Just like Vajpayee Government was known for building road highways, Modi Government should be known for broadband highway,” Prasad said.

Prasad has a number of challenges in the telecom sector as mobile operators struggle to wade through complex regulatory issues in the aftermath of the 2G spectrum scam. “I am aware of the problems of this Department. The Telecom Department has been in the news for many of the wrong reasons and one of my first priorities will be to set things right,” Prasad said.

Telecom sector, which was once the poster boy of reforms, has not attracted any major investments in the last few years. While incumbent operators’ profits have been declining, partly due to high regulatory costs, some of the newer players were forced to exit.

“I do acknowledge that the way things have happened in the past have dented investors’ confidence. We need to restore that,” he said, adding that global investors need a stable taxation regime and retrospective tax should be generally avoided as the country needs foreign investment to boost the economy.

When asked specifically about the ₹20,000-crore tax notice to Vodafone he said, “We will look into it. Our manifesto has been very specific that we want a stable regime where those who invest in India may not have to face uncertainty.”

On the IT sector, Prasad said since information technology is an area of great growth in India, his first priority would be to further boost some of the policies and promote electronic manufacturing in the country.

IT & electronics “Manufacturing as a whole needs a big push in India, but manufacturing of electronics sector can be given further boost, which can bring considerable number of employees,” he said.

The industry reacted positively to Prasad’s initial comments. “Till date, no major IT company in the league of a Microsoft, Oracle, Google or WhatsApp has seen the light of day from India. There is no dearth of talent in India. What is missing is the ecosystem to nurture these types of companies,” Rohil Sharma, Chief Executive Officer, Perpetuuiti, said.

“The Consumer Electronics and Appliances Manufacturers Association (CEAMA) foresees a strong yet sustainable growth in the consumer durable industry, driven by the new guidelines and initiatives that will pave the way for boost in local manufacturing, economic growth, advancement in technology and innovation,” Anirudh Dhoot, President, CEAMA, said.

Hemant Joshi, Partner, Deloitte Haskins & Sells, said that Prasad appeared to have realised the power of telecom as a growth enabler and instrument to serve the masses.

“The new Government seems to have a strong vision for the telecom industry and want to portray a positive image nationally and internationally. The incoming Telecom Minister is in favour of transparent, clear and stable regulatory and legal regime for telecom industry in order to remove the uncertainty and policy paralysis masking the telecom sector,” he said.

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