At a time when the West Bengal government is awaiting a decision from the Centre on a moratorium on its debt, Chief Minister Mamata Banerjee has asked the government for yet another sop—an extension of the Software Technology Parks of India (STPI) scheme.
West Bengal Information Technology (IT) Minister Partha Chatterjee said the scheme would be a last-ditch attempt to keep IT majors, Infosys and Wipro, in the state. “The tax benefits of the STPI scheme come close to benefits on offer from the SEZ (special economic zone) scheme. If even after that, they do not want to stay, I can say nothing more,” he said. Of the tax benefits under sections 10A and 10 B of the STPI scheme, excise and customs reimbursements and exemption from sales tax were of primary significance. The scheme, which was started in 2000, ended last year. Plans are now underway to find alternative methods to aid new units under the scheme.
“Last year, Deloitte was given the mandate of preparing a report on the status and extension of the scheme. Several alternatives are now being considered,” said Omkar Rai, director-general, STPI.
The plea for the extension was part of Mamata Banerjee’s agenda when she met Urban Development Minister Kamal Nath in New Delhi last week. Following a telephone conversation between Nath and Chatterjee, engineered by Banerjee, Chatterjee’s office sent a formal letter, requesting the extension.
“While a concrete decision is yet to be taken, we believe the extension would easily be granted by the central government,” Chatterjee said.
Infosys and Wipro were scheduled to set up two anchor campuses in Rajarhat, in the outskirts of Kolkata. The plans ran awry when the Banerjee-led government decided that in keeping with their opposition to the SEZ scheme, the two campuses would not be recommended for SEZ status. The two campuses together entailed an investment of Rs 1,200 crore in Phase-1. On their completion, these would create employment for 30,000 people. Asked whether he had approached the two companies about the STPI status and whether the step would induce these to reconsider their plans, Chatterjee said he would wait for the extension to come through before approaching the companies. “It makes no sense to send these a proposal before the STPI extension comes through,” he said.
While Wipro, which is yet to make the full payment, has been on the lookout for alternative land, Infosys said the project had been kept on the backburner. Meanwhile, the West Bengal government has been attempting to come up with a package to woo the two companies back. “The STPI scheme extension is a perfect plan. If extended till 2014, it would mean the end of our woes related to the two campuses,” Chatterjee said.