IT & Telecom

India to Exempt Tax on Selected Services Starting July 1

Jun. 25 – India will exempt tax on services that deal with low-cost housing construction, power distribution, services within ports and airports, selected tournaments and championships, foreign travelers in transit and those flying to and from the northeast starting July 1.

“Repair of ships or boats or vessels belonging to the Government of India, including the Navy or the Coast Guard or the Customs, but does not include government owned public sector undertakings,” the Central Board of Excise and Customs (CBEC) said as to the services exempted from tax. Continue reading →

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India, China Business Reps. Sign MoUs

May 31 –Representatives from leading Indian and Chinese businesses and establishments signed several progressive memorandums of understanding today on the sidelines of Indian President Pratibha Patil’s visit to Shanghai.

Chinese and Indian delegates from top companies and institutions like Aargus, GMR Energy, Infosys, SEPCO, Wipro, and Shanghai’s Fudan University were in attendance, among many others.

India’s Wipro Technologies, one of the largest IT related companies in the country, was able to sign an MoU with Chinese officials from the city of Changzhou, in Jiangsu Province. The Indian company will establish a hydraulic cylinder manufacturing center and an accompanying research and development facility in the east China city. Continue reading →

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Finance Ministry Officials Propose Tax Reforms to Services Sector

May 3 – Finance ministry officials called for reforms to India’s tax structure for services like shipping, aviation and telecom to make them competitive.

In a working paper titled, “Policy for India’s Services Sector,” finance ministry senior economic adviser H.A.C. Prasad and additional economic adviser R. Sathish said that the government should rationalize the tax structure in the shipping industry, which pays 12 direct and indirect taxes currently.

Taxes like corporate tax, minimum alternate tax, dividend distribution tax, withholding tax on interest paid to foreign lenders, wealth tax, VAT, lease tax and service tax raise the effective tax rate of around 2 percent under the tonnage regime to around 9 percent. Continue reading →

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India Forecast to Become Largest Direct-to-Home Market by 2012

Apr. 22 – India is forecast to become the biggest direct-to-home market globally by 2012, based on an annual study made by information services provider Media Partners Asia (MPA).

The Indian market is expected to surpass the U.S. market in terms of size with its projected subscriber base expanding from 17 million last year to 45 million by 2014 and 58 million by 2020. The country’s pay-TV industry sales will be worth US$18.5 billion in 2010 and US$12.1 billion by 2014. Continue reading →

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3G License Bidding Reaches US$1.36 Billion

Apr. 20 – On the eighth day of India’s ongoing auction of third generation (3G) licenses, bids increased by an estimated 73 percent from the original base price set by the government to Rs.60.7 billion, or about US$1.36 billion.

“Earlier, I said the auction could fetch Rs. 30,000-35,000 crore, but now I am optimistic that it may go up,” Communications and IT Minister A. Raja told The Business Standard. The auction is forecast to bring the government at least US$8 billion with the process lasting several weeks. Continue reading →

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India Clears FDI Proposals Worth More Than US$510 Million

Mar. 30 – The government has cleared 23 foreign direct investment proposals amounting to more than Rs.23.25 billion, or about US$510 million.

The highest FDI proposals came from broadband services provider Tikona Digital Network followed by components maker Bharat Forge and medical device maker Opto Circuits. “The Union Government has approved 23 FDI proposals amounting to approximately Rs.2,325.21 crore,” according to an official statement. Continue reading →

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Hotel Tax Holiday Extended to July 31

Mar. 19 – The Indian government has extended the five-year tax holiday for hotel projects from March 31 to July 31 in an effort to stimulate development in the industry prior to the Commonwealth Games in October.

The five-year tax holiday previously applied to hotels finished and operational from April 1, 2007 to March 31, 2010 covering two, three and four-star category hotels and convention centers in the National Capital Territory of Delhi and the districts of Faridabad, Gurgaon, Gautam Budh Nagar and Ghaziabad. The new extended tax holiday scheme will continue to offer the special tax discount rates in the next five years for hotels finished by the July 31 deadline under Section 80-ID of the Income Tax Act.

Continue reading →

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Qualcomm to Enter Broadband Wireless Auction in India

Mar. 18 – Qualcomm announced on Wednesday that it will be entering India’s upcoming auction in an effort to gain access to the country’s broadband wireless spectrum.

India’s government plans to auction off two slots of bandwidth set aside for wireless technology during the auction with bidding for one slot starting at US$386 million. Continue reading →

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