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Task force has a success recipe for hardware sector

The introduction of SBIT units is inevitable because earlier schemes like the 'electronics Hardware Technology Parks' and subsequently modified EHTP schemes have not made the Indian hardware industry globally competitive

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vis-à-vis Korea, Hong Kong, Singapore, the Philippines and Taiwan.

This has been stated in the second basic background report on the Indian IT industry prepared by the task force.

The report further claims that it is feasible to create a competitive manufacturing base in the country only if the concept of 'soft bonded unit' for unified domestic and export manufacturing is brought about.

The other measures suggested in the report include a number of concessions and relief packages to make the concept of SBIT a success. One suggestion is to allow the units located in a bonded area to sell 100 per cent of their production in the 'domestic tariff area' on payment of import duties and countervailing duty.

Moreover, all purchases should be made free of sales tax, entry tax, excise duty and octroi like in the case of export-oriented units. This would make enable all clearances to happen on the basis of only self-declaration without insisting upon any permit or licence, thereby making domestic tariff area access simple.

Besides, the report has also sought a single-window clearance for any authorisation, treatment of supplies from DTA to the soft bonded IT unit as deemed export and allowing all banking activities to be carried out in hard currencies.

The report further states that the SBIT concept can address several other problems like the lack of co-ordination in the electronic/IT hardware sector, absence of a comprehensive national policy on the IT hardware industry and non-availability of cheap IT hardware for individuals and educational institutions.

The task force has a view that with the zero-duty regimes, the excess quota to DTA would lose significance.

- Compiled from the Indian media

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