India can become a global ‘smart power’ if the government and the industry focus on hardware, rural employment, and R&D in order to connect the ‘disconnected’ – people who are left out by ICT revolution, and to leverage the country’s two key strengths of availability of skilled manpower and large consumer market, said Mr V Narayanasamy, Union Minister of State for Planning and Parliamentary Affairs, Government of India.

Delivering the inaugural address at Connect 2010, India’s premier ICT event, organised by the Confederation of Indian Industry (CII) here today, the Minister said that the central government is keen to provide incentives for companies who are willing to go to tier-2, tier-3 cities and rural areas.  On its part, the government is focusing on rural development in a major way. It is creating job guarantee schemes, connecting all the districts of the country at the cost of Rs 20,000 crore, and is creating 2,50,000 citizen service centres. The Centre has also allocated Rs 1800 crore for promoting State Wide Area Networks.

“India’s consumer market for hardware can be a big incentive for the industry. India is going to import US$ 490 billion in hardware in the next five years,” he pointed out. He urged that the government should be highly supportive of the ICT sector that exports US$ 48 billion worth of products and services that account for one fourth of the total exports. The government should consider extending the tax concessions to the ICT industry, which are supposed to be withdrawn in 2011, for few more years.

In his Special Address, Dr Jung-Chiou Hwang, Vice Minister of the Ministry of Economic Affairs, Taiwan, said that since Taiwan and India have developed expertise in ICT in two different areas, it makes a strong case for partnership. Taiwan’s total ICT output is about US$ 300 billion. It is world’s leading player in about 37 product categories, and number one in 10 ICT product categories such as notebooks, net books, LCD monitors, and mother boards. To sustain this growth, the hardware industry in Taiwan needs to develop software capabilities. If India’s software power can be combined with Taiwan’s hardware knowledge, it will result in sustainable partnership.

Addressing the conference, Mr P W C Davidar, IAS, Principal Secretary – Information Technology, Government of Tamil Nadu, announced that the government is launching the employment exchange portal on September 15, 2010. The portal would enable the private sector to identify and hire people based on skills and locations. He said that Tamil Nadu is probably the only State to run an ICT Academy in partnership with the private sector. The ICT Academy has already benefitted 473 engineering and non-engineering colleges, by improving the content and delivery of courses, and training the faculties. The Academy has, in the last one year of its operations, trained over 2500 faculties in association with 15-odd software companies.

Mr Davidar said that the State government is taking ICT to rural areas. Its nodal agency, ELCOT is building seven IT parks across the State, mainly at tier-2 cities. The government’s recently-announced rural BPO policy is focusing on creating eco-system across the State so that it makes sensible for the private sector to invest in rural areas. The government is also working out incentives in the form of capital and training subsidy for BPOs that are setting up centres in tier-2, tier-3 and rural areas.

To make services citizen-centric, the government is putting special emphasis on e-governance. All government departments including healthcare, labour welfare, and agriculture, are making their operations web-based. The backward class welfare scheme of Rs 200 crore is currently processed entirely through online and the process of labour welfare board is web-based.

Providing the Opening Remarks, Mr S Gopalakrishnan, Chairman, Southern Region, CII, and Chief Executive Officer and Managing Director, Infosys Technologies Ltd, said that IT has to be used to benefit industry, society, and also common man. The ICT should play a central role in ensuring economic sustainability, as well as promoting environmental and social sustainability, both as an industry and as a key element of enabling infrastructure.

“We believe sustainability, in all its components, should be a priority for policymakers, businesses and civil societies alike to foster a more just, more inclusive and crisis-resilient workd. ICT and the industry must now rise to the challenge,” he said.

Delivering the theme address, Mr S Mahalingam, Chairman, Connect 2010, and Executive Director & CFO, Tata Consultancy Services, said that the focus of Connect 2010 is on next practices and making natural clusters of the State which include automobile, engineering & manufacturing, healthcare, and entertainment collaborate with information technology to achieve their goals. For instance, IT can play a big role in frugal engineering in automobile and manufacturing sector, and help the healthcare sector reach its goal of providing affordable healthcare to all.

“It is clear that Tamil Nadu is at the next stage of development. All the IT/ITeS companies in the target list of any State are already here in large size and user organsations also have set up their captive units here. At the same time, the State should focus on moving up the value chain, and develop competencies and build livable cities,” he said.

Ms Nandini Rangaswamy, Chairperson, CII- Tamil Nadu and Chairman & Managing Director, Chandra Group proposed a vote of thanks.