Short essay on India and the Information Technology

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The information revolution is driving the world today and in this scene the convergence of three key sectors - information, communication and entertainment (ICE) - holds great promise.

The Indian software industry, with a market capitalization of about Rs. 1,806 billion and revenue of Rs. 215 billion in has begun to make inroads into the Sensex and NASDAQ, and has been instrumental in upgrading global perceptions of India.

Moreover, in the recently -released Arthur Anderson report on the growth potential of the Indian entertainment business - prepared for the Federation of Indian Chambers of Commerce and Industry (FICCI) - the growth projection seem to border on quixotic euphoria.

The take-off of the New Economy has resulted in a flourishing demand for companies providing chip design, web-based design, Internet and telecom software services etc. Supported by an enormous pool of highly skilled professionals available in India, Indian companies have demonstrated their global competitiveness in this field.

India today is only second to the US in terms of the number of English-speaking technical professionals in the world. After showcasing their value in successfully debugging Y2K, Indian design and engineering companies have now entered value-added software services.

Indian companies have established a cutting edge through cost and quality advantages, state-of-the-art capabilities, technically trained and highly reliable professionals, as well as through timely execution and delivery of products. The strong base of national institutes of information technology and engineering colleges provide fodder to the ever-increasing demand for techies. This has influenced several multinationals to establish their research and development (R & D) units in India. The Indian government, too, has contributed to this growth by providing fiscal benefits making available high-speed data communication and infrastructure.

There are, however, major obstacles in the way -lack of domestic computerization, low internet penetration (though this is rising, according to reports), and ineffective cyber laws. What is more, power supply in every region - even in Bangalore and Hyderabad, the cradles of the software boom - is erratic. There must be a regulatory regime incorporating regulations for telecommunications, broadcasting, foreign investment, arbitration, copyright and piracy. While the IT Bill has already been passed^, it must be integrated into a comprehensive broadcast bill, as the distribution of films, music and other entertainment software over the Internet is already dramatically altering the future of the industry.

Any blueprint for sustaining the nascent entertainment boom must be informed by a long-term vision for growth through convergence in the telecommunications, information and broadcasting, and related ministries. It is imperative to correlate existing government facilities with industry needs.

Allied agencies such as the Directorate of Film Festivals, National Film Development Corporation. Films Division, Film and Television Institute of Indian and Doordarshan must be integrated speedily. Concomitantly, a long-term hardware investment in entertainment delivery systems, including telephone, cable, and satellite, digital subscriber line (DSL) and wireless application protocol (WAP) will be required to sustain the software boom.

Unfortunately in India, the film industry-on which both the television and music industries so veraciously feed - does not receive much official encouragement as a major potential foreign exchange earner, as it does in the US, for instance. The US often makes foreign investment conditional on opening up markets to its film industry.

An integrated broadcast legislation would, for instance, help actualise the industry status that the Indian film sector currently enjoys only on paper. This would weaken the criminal funding nexus and pave the way for professionalism and accountability. The industry is currently weighed down by diverse problems, including susceptibility as targets of criminals and film software pirates, as well as immature censorship.

The film industry would also benefit from a uniform national entertainment tax. The present system, driven by political expediency, is characterized by wide disparities, from a 60 per cent tax in Maharashtra to 16 per cent in Andhra Pradesh.

There are ominous signs that must be paid attention, the most important of them being a decline in the number of films made of India, in the recent past. And there is also a dearth of trained personnel. If, however, appropriate steps are taken, India could indeed ride the wave of the new ICE age. There are signs of hope-Indian films are doing well on the foreign market and several films are among top listing abroad. But -and it is a big but - things could get better only if the telecom sector is spruced up.


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