Presentation 1 Budget
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Budget 2008-09
IT SECT OR Presented By: Mandar Joshi Nisha Nair
Growth of Software Industry in India
Effect of stronger rupee on IT, BPO & KPO sector Decline of sales growth to 27% from 45%
Decline of average net profit growth to 22% from 48%
Failure to meet export target by US$ 15-20 billion.
Fall of salary growth to 25% from 64%
More imports less exports
Solutions from experts Reduce its dependence on conventional export markets Negotiate their contracts in rupee rather than dollars Move up the value chain Slowing down the rate of salary hike The government should give benefits in the form of tax sops Get a lot more Indiacentric Tap hitherto untapped markets Draw in work-force from the fringe states
Contribution of IT sector to exports and GDP
Source: Financial Express
Budget 2007-08 Allocation for e-
governance to increase from Rs.395 crore to Rs.719 crore E-governance action plans at state levels to increase from Rs.300 crore to Rs.500 crore. Rs.33 crore to be provided for a new scheme of manpower development for software export industry.
Highlights of Central
Plan: Ø 285 crore for National Informatics Centre. Ø 719 crore for eGovernance programme to improve efficiency, convenience, accessibility and transparency in Government.
Source:www.indiabudget.n ic.in
Budget 2008-09 Allocation to the department
of IT enhanced to Rs.1680 crore in 2008-09 from Rs.1500 crore in 2007-08 Two schemes for establishing 100,000 broadband internetenabled common service centres in rural areas and SWAN with central assistance under implementation Rs.75 crore provided for the common service centres Rs.450 crore provided for SWAN Rs.275 crore for the State Data Centres
Highlights of Central Plan:
Ø 400 crore for National Informatics Centre. Ø 800 crore for e-Governance programme. Ø 100 for establishing the National Knowledge Network. Ø 45 crore for Manpower Development initiatives. Ø 33 crore for Cyber Security.
Source:www.indiabudget.n ic.in
2007-08 Budget V/S 2008-09 Budegt
Source: www.indiabudget.nic.in
Our views •The hike in excise duty from 8% to 12% on packaged software and addition of customised software in the service tax net is expected to negatively affect application development players in the domestic software industry. •With no comment on extension of IT tax exemption(sections 10A and 10B),the overall impact is expected to be marginally negative.
Thank You
IT SECT OR Presented By: Mandar Joshi Nisha Nair
Growth of Software Industry in India
Effect of stronger rupee on IT, BPO & KPO sector Decline of sales growth to 27% from 45%
Decline of average net profit growth to 22% from 48%
Failure to meet export target by US$ 15-20 billion.
Fall of salary growth to 25% from 64%
More imports less exports
Solutions from experts Reduce its dependence on conventional export markets Negotiate their contracts in rupee rather than dollars Move up the value chain Slowing down the rate of salary hike The government should give benefits in the form of tax sops Get a lot more Indiacentric Tap hitherto untapped markets Draw in work-force from the fringe states
Contribution of IT sector to exports and GDP
Source: Financial Express
Budget 2007-08 Allocation for e-
governance to increase from Rs.395 crore to Rs.719 crore E-governance action plans at state levels to increase from Rs.300 crore to Rs.500 crore. Rs.33 crore to be provided for a new scheme of manpower development for software export industry.
Highlights of Central
Plan: Ø 285 crore for National Informatics Centre. Ø 719 crore for eGovernance programme to improve efficiency, convenience, accessibility and transparency in Government.
Source:www.indiabudget.n ic.in
Budget 2008-09 Allocation to the department
of IT enhanced to Rs.1680 crore in 2008-09 from Rs.1500 crore in 2007-08 Two schemes for establishing 100,000 broadband internetenabled common service centres in rural areas and SWAN with central assistance under implementation Rs.75 crore provided for the common service centres Rs.450 crore provided for SWAN Rs.275 crore for the State Data Centres
Highlights of Central Plan:
Ø 400 crore for National Informatics Centre. Ø 800 crore for e-Governance programme. Ø 100 for establishing the National Knowledge Network. Ø 45 crore for Manpower Development initiatives. Ø 33 crore for Cyber Security.
Source:www.indiabudget.n ic.in
2007-08 Budget V/S 2008-09 Budegt
Source: www.indiabudget.nic.in
Our views •The hike in excise duty from 8% to 12% on packaged software and addition of customised software in the service tax net is expected to negatively affect application development players in the domestic software industry. •With no comment on extension of IT tax exemption(sections 10A and 10B),the overall impact is expected to be marginally negative.
Thank You
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