BUDGET EXPECTATIONS: Industry wants computer depreciation at 100%

Vendors and partners would like Finance Minister, Yashwant Sinha,

to raise the depreciation on computers to 100 percent in his budget for 2002-03

to create immediate demand from corporates. Says Ajai Chowdhry, Chairman and

CEO, HCL Infosystems, "The depreciation limit on PCs should be enhanced.

This will boost up corporate buying."

The demand for 100 percent depreciation is not just for

computers. Even in the networking field there is a strong sentiment that 100

percent depreciation will stimulate greater demand. Points out Manoj Chugh,

President-India & SAARC, Cisco Systems, "To further drive the Indian

networking market forward, we would be keen to see the Government provide for

depreciation of 100 percent in the first year itself for networking and other

hardware products." Manoj believes that this initiative will create the

right environment for corporates in India to enhance technology absorption.

While some sections of the industry want the Finance Minister to

bring down customs duties to zero, others says that if customs duties are

brought to nil, then local hardware manufacturing will suffer. Thus, as already

reported, Finance Minister is expected to bring down duties from 35 to 30 in the

budget.

The industry wants the Finance Minister to take concrete

measures to ensure that govern-ment’s buying of IT goes up substantially.

Manoj wants the Finance Minister to use the budget platform to clearly define

that at least three percent of the total government expenditure is spent on IT

with a well-defined monitoring system.

The IT manufacturers want the Finance Minister to create

sufficient differential between raw material and finished products to ensure

industry’s survival. Says Anil Gupta, CEO, Microtek, "Finance Minister

has to do this for sure. Otherwise, manufacturers will be out of business."

Industry wants the government to focus more on spending in

infrastructure projects which it believes will revitalize the economy in the

short as well as long term. According to Anil Valluri, Director-Systems

Engineering, Sun Microsystems, investment in infrastructure impacts every other

industry including IT.

Says Kiran Rao, Manager-Marketing, Wipro Infotech,

"Government needs to create a conducive climate for IT manufacturing."

He wants the Finance Minister to create manufacturing zones, which he refers as,

‘Islands of Infrastructure Excellence’.