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'It's a mixed Budget as far as software and IT are concerned'

BUDGET 2000

N R Narayana Murthy

We have had a mixed Budget as far as the software and IT industries are concerned. On the one hand we have seen several positive moves like liberalising the venture capital regime, increasing FI limit from 30 per cent to 40 per cent and bringing down the prices of PC and components by 5 per cent points.

On the other hand, several initiatives like enhancing the acquisition limit from US $ 100,000 to a much higher figure, taxing stock options at the time of sale of shares and removing the bonding requirement by custom authorities have not happened.

I would say that it is not friendly as we all expected it to be for the reasons that I have already explained above. If he had increased the acquisition limit as well as shifted the taxation to the point of sale of shares arising out of employee stock option, then I'd have said it is a very friendly Budget.

We in the industry believe that the right time for taxing the employee stock option is at the time of the sale of the stock by the employee. I am very confident that we will be able to give whatever data and clarification the government needs to accept our view and that the government will accept it as we move forward.

Those companies which have been paying taxes outside India will not be affected significantly by the taxation policy. Secondly, in any case our focus should be enhanced to the velocity of business, making sure that the government plays a very little role in corporate decision-making and not so much on sops and concessions. So if we can ensure that the velocity of decision-making is enhanced, we will grow much faster.

I think biotech, pharma and other services like banking, and any company that will bring e-commerce opportunities.

N R Narayana Murthy is chairman, Infosys.

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