To soothe the fraying nerves over issues such as simplifying the tax structure, ensuring ease of doing business and creating a manufacturing hub in the country, Ravi Shankar Prasad, Communications and IT Minister, met top CEOs of the IT industry on Tuesday.

In a meeting organised by industry body Nasscom, Prasad reassured the industry that the Government will work with the IT fraternity to address all issues dogging the sector. “Decisions will not be delayed and we are keen to work with the industry to remove all impediments,” Prasad told a gathering that included Azim Premji, Chairman of Wipro; KK Natarajan, CEO and MD of Mindtree; and Aruna Jayanthi, CEO of Capgemini India.

‘Heartening’ meeting Prasad's visit comes at a time when the Indian IT industry has been increasingly disillusioned with the Government over the lack of understanding regarding taxation laws, a crumbling infrastructure and lack of improvement in the business environment. The industry is also seeking incentives for companies to move to tier-II and -III towns.

Industry representatives, on their part, seemed to warm up to him. “It’s heartening to see that a Minister is giving us a hearing and seems to understand our pain points,” said Vijay Ratnaparkhe, President and MD of Robert Bosch Engineering and Business Solutions. The industry, however, was firm in presenting its laundry list of demands.

“Due to certain regulations, some companies can't set up a payment gateway to process online transactions and are forced to open offices abroad,” said R Chandrashekhar, President of Nasscom. On his part, Prasad reiterated his Government’s intent to use more IT, encourage domestic manufacturing and make India a destination for making IT products.

“If India does not aggressively embark on creating software products, it would miss out on the next growth wave,” said Ashank Desai, Founder and Ex-Chairman of Mastek.

Apart from creating a software products hub, Prasad spoke about the importance of broadband connectivity. Prime Minister Narendra Modi has laid out a vision which includes setting up Wi-Fi connectivity in most parts of India and laying a broadband network across 1 lakh panchayats by 2015, said Prasad.

Broadband is an area of concern in the country.

A recent Akamai report pegged India 85th in broadband connectivity, globally.

However, not everybody is impressed about the Government’s plan.

“While the intent is positive, they seem to have no clue about power, water and infrastructure requirements, if their lofty goals need to be achieved,” said an India head of a multinational corporation, requesting anonymity.

Nasscom recommendations Nasscom members also have put forth recommendations to the Ministry to promote growth and global competitiveness of the IT industry, build newer markets, focus on skill development and employment creation.

What industry wants

Incubation facilities and seed capital to be provided to the top 500 educational institutions.

A ₹5,000-crore India Seed Fund to be started over a period of 10 years by SIDBI/IDBI and the Government to co-invest with seed groups like Mumbai Angels, Indian Angel Network, Bangalore Angels etc.

A ₹5,000-crore India Growth Fund to be started over 10 years to co-fund growth companies.

Facilitate registration of IP globally via grants.

Create a special category for software product industry.

ICT needs of the Govt should be procured from Indian software product companies.

Improve the SME Stock Market Listing, enabling financial institutions as market makers.

Create a tax regime helpful to the software product industry to exclude “packaged/canned software” from the purview of ‘Royalty’ and consequently not subject to TDS transactions.

Exemption from excise duty on products or service tax.

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