ICT Policy - 2016 in Bangaru Telangana

​ICT Policy and allied Policies - 2016

Telangana State ICT Policy, 2016 was launched on 4 April, 2016 at Hyderabad International Convention Centre (HICC) at 3 pm in the august presence of Sri ESL Narasimhan, Hon'ble Governor Telangana & AP, Sri K. Chandrashekar Rao Hon'ble Chief Minister, Sri NR Narayana Murthy Hon'ble Chairman Emeritus, Infosys and Sri KT Rama Rao, Hon'ble Minister for IT, Panchayat Raj and MAUD. Cabinet Ministers, legislators from Telangana, prominent industry, business leaders from different verticals, senior bureaucrats, and other stakeholders also graced the occasion.

In addition to the ICT Policy, four other allied documents - Policies on Rural Tech Centres, Innovation, Electronics and Gaming & Animation - were also released at the event.

VISION FOR THE IT SECTOR

In order to identify the strengths and weaknesses of the IT Industry in Telangana, the State Government has conducted a detailed benchmarking analysis of Telangana IT Industry with other countries, as well as with other states across India. Post these benchmarking efforts, and after consultations with industry experts, the government has identified key competitive advantages that the state has, given its geographical location, infrastructure facilities , available talent pool and regulatory framework. This analysis has helped in developing state government’s vision for the IT sector. Subsequently, the State Government has identified 10 focus areas related to IT Investments in these areas will be accorded the highest priority by the government.

The table below summarizes the vision statement, following which the ten priority areas are explained in detail:

• Telangana should become the most preferred destination for any IT company which is planning to commence new activities anywhere in the world
• Telangana should be recognized as leader in key emerging technologies
• Telangana government aims to intensively use IT tools to improve processes and deliver citizen services better and stand out as a role model for smart governance
• Citizens of Telangana will be empowered to make the best use of the opportunities emerging in an increasingly digital world
• Telangana should become a leading global hub for technology entrepreneurship and innovation in the country

To make Hyderabad the national leader in terms of IT exports and to leverage on the strong infrastructure that exists to attract more investments

• To double the value of current INR 68,232 Crores IT exports in Telangana in 5 years
• To double the current employment of 4 Lakhs in 5 years
• To establish 3 tier-II cities as IT Hubs in 5 years

Telangana will continue to encourage all existing IT/ITES companies already located in the state to expand and grow within the state, and also motivate and incentivize new companies to come and establish their units in the State. While Hyderabad will remain the center of product development and R&D activities, companies, particularly ITES companies will also be encouraged to locate themselves in Tier 2 cities like Warangal, Karimnagar, Nizamabad etc. The following instruments will be utilized to facilitate expansion of IT and ITES industry.

CLASSIFICATION OF PROJECTS

Mega Investments:

Companies/entities that invest more than INR 200 Crores or provide employment to over 1000 people or belong to areas of strategic importance.

Start-ups:

Individuals/companies/entrepreneurs working on their idea/concept, having 0-5 years in Business and employee strength of 0 - 50.

Small and Micro Enterprises (SMEs):

Small & Micro IT/ITES Companies/units/Enterprises with a turnover of more than INR 50 Lakhs and less than INR 10 Crores per annum. According to Government of India, Ministry of Micro, Small & Medium Enterprises, a Small & Micro company has an investment of less than INR 5 Crores in the manufacturing sector and less than INR 2 Crores in the services sector. The nature of an IT/ITES company is such that there is a relatively lower investment compared to other sectors. Hence the definition is changed such that the scale of the company is determined by its revenues.

Mid-Scale companies:

IT/ITES Companies/units with turnover more than INR 10 Crores and less than INR 200 Crores According to Government of India, Ministry of Micro, Small & Medium Enterprises, a Medium scale company has an investment of between INR 5 Crores and INR 10 Crores in the manufacturing sector and between INR 2 Crores and INR 5 Crores in the services sector. The nature of an IT/ITES company is such that there is a relatively lower investment compared to other sectors. Hence the definition is changed such that the scale of the company is determined by its revenues.

Tier II locations:

Any city/town outside HMDA city limits in Telangana is classified as a Tier II city.

DEVELOPMENT OF IT PARKS

IT activities are largely concentrated in Gachibowli, Madhapur and Nanakramguda to a large extent in Hyderabad. Two more clusters at Adibatla and Pocharam are at a nascent stage. As a part of the ITIR (Information Technology Investment Region) scheme, Government will identify suitable land parcels under which new IT clusters can be located. The Government will leverage the growth corridor along the Outer Ring Road (ORR) by earmarking certain zones to be used exclusively for development of Information Technology.

NEW IT PARKS IN PPP MODE

While government agencies like Telangana State Industrial Infrastructure Corporation (TSIIC) will be encouraged to setup IT parks on their own, reputed private developers with proven track record will be also welcomed to develop IT parks in government lands in an appropriate PPP mode. The exact structuring of each of the PPP projects will be decided by the government on a case to case basis. In addition, IT parks developed by private parties on completely private owned lands will also be eligible to receive benefits from the government on par with those developed on government lands either by government agencies or through PPP.

CREATION OF INFRASTRUCTURE

All the new IT parks and IT clusters will be provided with the required infrastructure of highest standards. Telangana State Industrial Infrastructure Corporation (TSIIC) will become the nodal agency to create this infrastructure and manage the land bank. ITE&C department will play a key role in existing IT parks as well, in ensuring that the existing infrastructure is well maintained at all times. A separate Critical Infrastructure Fund (CIF) will be kept at the disposal of ITE&C department to meet urgent maintenance works in existing IT Parks.

COVERAGE UNDER TS-IPASS

The Industries department of the government has recently brought out a new scheme, the Telangana State Industrial Project Approval and Self Certification System (TS-iPASS), which provides for automatic approvals based on self-certification. All approvals required by mega industrial projects will be given in 15 days, and for all other types of industrial projects, the approvals will be given in 30 days. Further, a right has been bestowed to the investor in that, if the agencies fail to provide the approvals within 15/30 days, the approval would be deemed to have been accorded, and the agency which caused the delay will be penalized. All approvals pertaining to IT companies will also be covered by the TS-iPASS.

ALLOTMENT OF GOVERNMENT LAND AND PROVISION OF INCENTIVES

Given the fact that the Information Technology sector creates massive employment and also contributes to the state’s economy in a very significant way, the Government also needs to encourage IT companies coming to the state by providing suitable incentives. Incentives will be offered in the following ways

1. Land cost rebate linked to employment
2. Power cost reimbursement
3. Reimbursement of stamp duty, transfer duty and Registration Fees
4. Reimbursement of patent filing/copyright costs and Quality Certifications costs
5. Recruitment Assistance incentives