India’s seven-member Group of Ministers (GoM) approved the hardware report of the Prime Minister’s Task Force on Information Technology and Software Development. The Group includes the ministers of finance, industry, commerce, human resource development, external affairs and communications. The GoM met for the first time last week and most of the 84 points in the report met with their approval. The Soft Bonded IT Unit (S-BIT) scheme has also been approved though some changes in value-addition norms are in the offing for telecom products. Union minister for communications Jagmohan, who is also a member of the GoM, has asked for the inclusion of greater value-addition norms for telecom products. S-BIT units will be able to import their inputs at zero duty but on sales to the Domestic Tariff Area (DTA), a percentage of the prevailing normal rates will have to be paid. This percentage varies from 40% to 65% depending on whether the product is an intermediate or a finished good. For electronic components alone, a flat rate excise of 8% will be payable, but customs duty will be wholly exempt.
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