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IT cos should expand export base: Pilot
(Source :ET, Aug 12th 2009)

FROM wearing a corporate suit in Philadelphia to donning a white kurta in a red (VIP) bungalow in Lutyenas Delhi, it has been an eventful journey for 31-year old Sachin Pilot. As an MBA graduate from Wharton Business School, the new Minister of State for IT and Communications shows lot of promise for the IT-ITeS industry, which is currently battling a severe slowdown. However, with about $10 billion already allocated by the government under the NeGP (national e-governance plan) and USOF (Universal Service Obligation Fund), the minister feels that its rural and domestic market that will pilot the growth of both telecom and IT. He shares his vision for the sectors with Harsimran Singh & Rustam Roy. Excerpts:

What should the IT-ITeS sectors focus on to sustain growth?
Revenues from IT-ITeS industry reached almost $60 billion this year. Of this, about $46 billion came from export services and $12.5 billion from the domestic market. The growth tapered a bit because of the global slowdown. Yet, the industry has been a net hirer, as opposed to other sectors like aviation and textiles, which have resorted to mass layoffs. But the cost advantage of Indian IT will decline if we continue to provide commoditised IT services. China, Vietnam, Philippines, Taiwan have already started giving competition to India. To prevent this, Indian IT should expand its export base to new geographies like East Asia and Latin America. We should create niche software products and also focus on domestic market. But IT industryes growth will actually have no meaning for the common citizen in remote parts if it fails to improve his life.

How do you plan to bridge this digital divide?
We have to make e-governance reach the hinterland. Under the Rs 24,000-crore NeGP, we plan to set up about 1,00,000 common service centres (CSCs) across 6 lakh villages in the country. Through CSCs, services like land record holding, tax filings, municipal services will reach the common man, through the click of a button. This will remove corruption. Citizens will not have to depend on a particular government officer to get hold of a land record statement or an NoC. PC penetration will also improve.
Lack of fluency in English has been a roadblock. To remove this, the Centre for Development of Advanced Computing (CDAC) has completed making translation software in 16 languages. Now you can do all your computing in 16 Indian languages. This will kickstart IT penetration.

But the current price of computers is also making them unaffordable for the masses...
Many companies are planning to bring down PC cost to as low as $200. The government can’t force computer makers to bring down prices. Prices of laptops and PCs will automatically come down as their penetration reaches a critical mass, like it happened in the case of mobile handsets.

Whats your plan to improve the dismal state of broadband penetration? The USO Fund has also not been adequately been utilised?
Within three years, all panchayats in the country will be connected by broadband. A joint session of Parliament has recently passed a resolution to achieve this aim. We will have to do it and we will find a way to do it. BSNL has already connected 28,000 rural panchayats by broadband. We are in the process of connecting national universities and colleges via broadband. I am personally looking after the USOF. We have released funds for setting up about 5,000 mobile towers in rural areas. Soon, we will invite bids from all operators to set up about 10,000 more such mobile towers. Currently rural teledensity is about 15.5%. By 2014, we plan to increase it to 40%. This will improve wireless broadband connectivity.

Will the current high reserve price of auction of wireless spectrum impede broadband growth?
No. I support the view that auction leads market to discover the price. Yes, spectrum allocation is one of the keys to broadband penetration and we will ensure that we are able to achieve it.

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