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IT investment regions not eligible for new tax benefits
June, 12th 2008
The Information Technology Investment Regions (ITIRs) being planned across the country will lay stress only on creating infrastructure and investor-friendly policy environment for the information technology (IT) sector. The ITIRs will not be eligible for new tax benefits, according to Mr Jainder Singh, Union IT Secretary.

A policy resolution for the ITIRs was gazetted on May 28. The ITIRs, which will be mostly built on the private public partnership model, are planned to promote investment in the IT, IT-enabled services sectors and electronic hardware manufacturing.

If there are any special economic zones in the ITIR area, they will get existing tax benefits eligible for them, Mr Singh told newspersons on the sidelines of the two-day Nasscom BPO Strategy Summit 2008.

investment regions

The idea of ITIRs is to create huge IT investment regions where the Central Government will provide infrastructure like airports, roads and telecom, and States will provide land and power. No State Government has come forward with a proposal since the policy was gazetted only a few days ago. If there is any initiative from a State, it will take five or six months for the plan to be finalised, he said.

At present electronics production is only 1.7 per cent of the countrys gross domestic product. It is expected to grow to 5 per cent of GDP by 2015. The ITIRs will be delineated investment regions with a minimum area of around 40 sq km planned for the establishment of IT/ITeS and electronic hardware manufacturing units along with the associated services and infrastructure.

The ITIRs will be a combination of production units, public utilities, logistics, environmental production mechanisms, residential areas and administrative services.

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