We have a long way to go before the technology boom ends.
quote.bloomberg.com
India to Spur Long-Distance Competition, Computers, Internet
By Sumit Sharma
New Delhi, July 15 (Bloomberg) -- India, the second-most populous country, will deregulate domestic long distance telecommunications next month, Prime Minister Atal Behari Vajpayee said, and won't tax sales of computers and related equipment for three years.
Vajpayee said at a conference of state technology ministers that India must stimulate the use of computers and the Internet. India has 1 billion people and 1 million Internet users, according to the BBC.
``Recognizing the benefits of large-scale competition, the government has decided to fully deregulate national long-distance operations with no artificial restriction on the number of licenses to be issued,'' Vajpayee said in a speech delivered to ministers of Indian states.
He said India will accelerate reforms and deregulate domestic long distance phone services by Aug. 15. Private companies will be allowed to have their own connections to take signals from undersea fiber optic cables, breaking a state monopoly. That should cut capacity restraints that have limited the spread of the Internet in India, he said.
Private phone companies and Indian consumers, who pay among the highest telephone rates in the world, stand to gain as the government dismantles state-run telecommunications monopolies.
Competition
The former state monopolies will be forced to compete with companies eager to win market share. Mahanagar Telephone Nigam Ltd., for example, is a state-run company which has held a monopoly on domestic long-distance phone services in Bombay and New Delhi. Its shares closed Friday at 204.55 rupees, down 46 percent from a 52-week high of 378.55 rupees set Feb. 11.
Pramod Mahajan, India's minister for information technology, said state ministers had agreed not to tax sales of computers and related equipment for the next three years. Sales tax is levied by the individual Indian states.
Custom and excise taxes will be cut for optical fiber equipment, Internet access devices, and TV sets for long-distance education and extension programs. Vajpayee didn't announce the extent of the cuts.
``India has come of age and embraced information technology as the principal engine of rapid growth,'' Vajpayee said. |
