India Inc. Budget 2006Posted: February 28, 2006
When searching for “Budget 2006“, the second link thrown up by Google is The Government of India: Union Budget and Economic Survey. You can watch the webcast here.
We are, however, deeply concerned about the increase in levies on packaged software and on IT hardware. These will result in higher prices and have an adverse impact on millions of customers and on the domestic IT market. It will be a setback to efforts to promote IT utilization in the Indian economy and for vital applications like education and health. At a time when technology and market demand were driving down prices, we see this as a retrograde step. We feel this is an intended consequence of adjustments of excise, countervailing duty, etc and hope that the Finance Minister will correct this aberration.
The increase in service tax and broadening the net to cover some previously excluded IT-related services will not only raise costs, but will act as a deterrent to outsourcing work to SMEs.
Interesting. So this implies Windows XP Pro, which costs the Indian consumer INR 6200 (~USD 140), will now cost more? Not sure how this will go down with the Industry. IT hardware also includes routers, equipment that and other basic equipment that impacts the bottom line. I have not been able to find the information NASSCOM is quoting from. If I were to wait another few hours, I am sure the leading dailies will have something up there. I am also not clear on whether the SEZ scheme has changed (for the worse or otherwise). NASSCOM also has a Webinar on March 2nd, might be worth tracking.
Update: I am not sure how much the new Windows XP Starter Edition will be priced at. I am also unsure as to how the new Vista will change this offering. Purely from the Indian budget perspective, IndiaTimes has the reactions of several key industry figures. Hindustan Times says the IT Industry is indifferent.