Kerala finally wakes up to IT reality
By James Paul | 07 Dec 2001
Kochi:
Keralas recently-announced new information technology (IT)
policy promises a package of major incentives to the IT industry
and ensures freedom from the rigours of labour laws.
The policy incorporates what is described as "the first
tailor-made regulatory framework for the IT industry,"
wherein software companies will be deemed as establishments under
the Kerala Shops and Commercial Establishments Act with several
exemptions from the provisions of the Act. IT industrial units
will be allowed to have three-shift operations with permission for
women to work on night shift.
Flextime and tele working will also be allowed. The IT industry
will be treated as a public service utility under the Industrial
Disputes Act, reducing the scope for employees agitations. The
government will permit self-certification by the IT industry in
respect to nine labour laws.
Under a comprehensive scheme aimed at creation of employment, the
policy specifies incentives up to 40 per cent of the fixed capital
investment for fresh investment in the coming four years. (This
may be reviewed after two years). The standard investment subsidy
for software, hardware and IT-enabled services (ITES) will be 20
per cent, subject to a ceiling of Rs 25 lakh. The subsidy will go
up on the basis of employment levels.
The 40-per cent subsidy, subject to a ceiling of Rs 40 lakh, will
be available to companies employing a minimum of employees in the
software or 125 employees in the hardware industry or a minimum of
500 employees in the ITES industry for a minimum of 12 months.
The existing companies going in for expansion will be eligible for
the concession. The policy proposes an early-bird incentive of Rs
50 lakh for those companies investing before 30 June 2002,
provided that they employ a minimum of 250 persons for at least 12
months.
The policy, which aims at a minimum annual growth level of 100 per
cent in IT, says Kochi will be developed as an international media
and information and communications technology hub with facilities
matching the best available worldwide.
The proposed hi-tech park and IT corridor are to come up in Kochi,
the landing point of two submarine cable networks. The policy
proposes a private park scheme that will allow the private sector
to build IT infrastructure of specified standards and get various
concessions. The floor area ratio for buildings of IT software
units will be fixed as five against the earlier 1.5.
The government will endeavour to promote Kerala as a favoured ITES
destination in this part of the world and to aggressively market
ITES as the states core competence. The state information
infrastructure, to be set up in two years, shall endeavour to
provide robust and seamless connectivity to the industry across
the state. Schools and colleges and panchayats will be linked and
the infrastructure will be used to serve the tourism
industrys communication needs.
Service providers within the state will be urged to maintain and
transparently share quality of service data with their consumers.
The minimum grade of service shall apply irrespective of the
location within Kerala. This will prepare the state for an era
when voice-over-Internet protocol communication shall be permitted
in India.
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