The Hindu Business Line : Telecom gear makers upbeat

THE telecom industry said that the Budget proposals would provide an impetus to local manufacturing. "The proposals are clearly directed to bring down the cost of setting up infrastructure. It will provide a fillip to local manufacturing even as it lowers the cost of ownership, said Mr Rajan Mehta, Vice President, Nortel Networks.

Mr T.V. Ramachandran, Director General, Cellular Operators Association of India said "Removal of mobile phone from the 1/6 scheme has been a long standing demand. This will provide an impetus to an already booming cellular subscription growth."

Operators were, however, disappointed with no reduction in the revenue share paid as licence fee. "The decision to exempt the 217 items from duty is part of the WTO commitment. Though it is good to see the Government honouring the commitment, the industry would have benefited if the revenue share was brought down to 6 per cent," said Mr S.C. Khanna, Secretary, Association of Unified Telecom Service Providers of India.

The industry also expressed concern at the 4 per cent CVD. " Imposition of 4 per cent Additional Duty may dampen the enthusiasm. However, continuation of the existing exemptions to the specified telecom/IT equipment would be received well, as it removes that small element of uncertainty to the ongoing telecom projects," said Mr Amitabh Singhal, President Internet Service Providers Association of India.

Mr Amit Sharma, Vice-President, South & South-East Asia, Motorola Inc. said "Although the CVD takes away the fiscal benefit, the industry acknowledges the positive impact this move will have on foreign direct investment."

Mr Ravi Sharma, President, Alcatel, South Asia, said "This is a very welcome Budget from the Government, in the right direction in making India a manufacturing destination for telecom equipments. This will surely make India a dominant player in the world for both manufacturing and services for the Telecom sector."

Mr D.P. Vaidya, Vice-President, Corporate, Hughes Escorts Communication Limited, said The FM could have provided the booster to spread of broadband Internet in order to bridge the digital divide and to speed up the initiatives of "Bharat Nirman" and empowering the rural masses.

Mr Narender Surana, Managing Director of Surana Telecom and member of FICCI, said "the Finance Minister's announcement with regard to promotion of domestic industry in the areas of electronics and telecom sectors by reducing the import duty to zero will ensure a level playing field in competitive bids. This will enable domestic cable companies to import inputs and manufacture at lower costs.

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