The $100-billion IT-BPO sector was left deeply disappointed with the budget announcements made by finance minister Pranab Mukherjee. The software services industry that employs close to three million people in the country felt he had ignored most of its proposals.
Software association body Nasscom termed the budget proposals as a "lost opportunity" for the economy.
N Chandrasekaran, CEO and MD of India's largest software exporter Tata Consultancy Services, said that for the IT industry the request to exempt SEZ income from MAT (Minimum Alternate Tax) has not been granted, "and this is disappointing." He added that (the Budget) "lacked short-term punch to get growth going".
Nasscom said there is no focus on putting the economy on a high growth trajectory. "...fiscal deficit reduction is through higher taxation rather than expenditure management, there is no roadmap on implementation of DTC (direct tax code) and GST (goods and services tax) and also the
issues of tax simplification, litigation have not been addressed," Nasscom said in a statement.
However, R Chandrasekaran, chief executive of Cognizant, said that the move to implement the advance pricing agreement is a recognition of the importance of cross-border trade.