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Gujarat announces concessions for IT industry

Gujarat Chief Minister Keshubhai Patel has announced a series of incentives, including reduction in stamp duty and sales tax, for the rapid growth of information technology industry in the state.

Speaking on the occasion of the bhoomipoojan yesterday of the state government's prestigious project to develop an Infocity at Gandhidham, he said Rs 4 billion worth of MoU would be signed later in the day with WorldTel Limited of Sam Pitroda.

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The agreement would be for developing a comprehensive information communication network in the state.

The government would also provide IT companies capital subsidy at the rate of 25 per cent for eligible new IT units. Total eligible capital investment would be provided and special incentives in the form of capital subsidy would be given at a graduated scaled to large units.

In addition, Patel said, IT units would be eligible to a turnover incentive at a rate of 5 per cent of the eligible annual turnover, with a ceiling of Rs 5 million. There would also be sales tax holiday on all IT software for the next five years.

The chief minister said a special connectivity incentive would be given wherein the state government would subsidise leased line rental up to 500 km to an extent of 50 per cent of lease rentals.

The IT units would be completely exempted from power-cuts and a new commission of IT would be appointed for administering the scheme.

The MoU, he said, would help the government to reach taluka level. Speaking on the occasion, eminent technocrat Sam Pitroda said information technology provided the foundation for creating new wealth and prosperity.

He advocated five strategies for the success of Infocity project, envisaging people's education about IT, its increased use in government functioning, in solving the basic problems of citizens, Internet connections and finding of its new applications.

Pitroda, who is a member of the state government's information technology advisory committee, said exhibitions on science and allied subjects should be put up at Infocity, electronic games park should be set up, a software centre, electronic shopping complex, multimedia and other things should also be made available.

National Association of Software and Service Companies President Dewang Mehta, who was also present, said his organisation would open a centre at Ahmedabad.

UNI

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