Finance minister P Chidambaram has turned down a request from the scientific establishment for financial encouragement to Indian industry for investing in the research and development sector.
In a pre-budget meeting with leading scientists here on Thursday, the finance minister said several measures were implemented after the last budget to make more funds available for the science and technology sector.
He said insufficient resources, the need to expand primary education and competing claims by various other sectors, as well as, for subsidies restricted the scope for large expansion of budgetary support for the research and development sector in the immediate future.
He, however, said he would examine all the suggestions in the context of the budget.
He encouraged the publication of a handbook to provide concise information on the fiscal benefits already available for research and development and educational institutions and their sponsors.
The scientists specifically wanted concessions to Indian industry to contribute towards in-house, as well as, public research and development.
They wanted increased public support for Ernet computer network, which connects educational and scientific institutions worldwide, exemption of taxes on royalty from books earned from abroad, harnessing the competitive advantage in the low cost and high skills area, such as, software and entertainment industry.
The 1996-97 budget allowed the creation of a technology development fund out of the monies collected as cess on technology import. A board was then set up to manage the fund.
The board will finance scientific projects which lead to development of some marketable products.
In 1995-96, the government had allowed 125 per cent weighted deduction of contribution made by industry towards research and development.
The government also funds some research projects in the in-house R&D centres of public and private industry. An award scheme exists for public and private industry for excellence in in-house research.
Among the scientists who participated in the meeting were Indian Institute of Science director G Padmanabhan, Indian Institute of Petroleum director TSR Prasada Rao and Centre for the Development of Telematics director K N Gupta and senior officials of the department of science and technology.
