We, the companies of Technopark, after careful consideration of the issues facing the IT and ITES Industry of Kerala in general, and of the Technopark community in particular, would like to bring to the attention of the people of Kerala as well as the Government of Kerala the following points:
1. The IT Industry in Kerala is estimated to employ a workforce of over 60,000, which includes both highly-skilled professionals as well as non-technical personnel, with Technopark employing approximately half of this workforce.
2. The IT Industry in Kerala had an approximate annual turnover of Rs. 1500 crores last year, with Technopark contributing about Rs. 1200 crores.
3. The global economic meltdown has begun to impact Kerala's IT Industry. The magnitude of impact and its timing will vary between companies. However, the growth rate of the industry is likely to be seriously impacted for the next 1-2 years. In particular, the year 2009 is expected to be the most impacted period.
4. The industry will be forced to take a series of steps in order to tide over the slowdown. The steps that may need to be taken include reduction in operational expenses, reduction or stagnation of remuneration, reducing employee intake, and in rare cases, termination of services of personnel.
5. We affirm that these measures may only be necessary for a limited period, and that the industry will continue to contribute to the economy of Kerala in a significant manner, even during this period.
6. The world over, Governments are coming out with a slew of measures help their industries tide over the present crisis. We call upon the Government of Kerala and the Government of India to adopt supportive steps to help the IT and ITES industries cope with the economic slowdown.
7. The IT and ITES industries have to compete globally, and therefore must have parity in operational costs to retain the global competitive edge. We request that the Government of Kerala act immediately to ensure that the administrative regime in the Government-run IT parks must be enabling and competitive vis-a-vis other IT destinations in the country.
8. We request that the Government does not impose any additional taxes or duties on the industry at this time.
9. We recognize the need for socially justice and equity in personnel policies as articulated by the Chief Minister in the recent meeting with the Industry. We reiterate that large-scale termination of employment will be a last-resort action, to be adopted only when the survival of a company is in jeopardy without it.
10. We would like to point out that collectively, Technopark companies have invested many times the amount of investment made by the Technopark itself. However, the companies have no say in the administration of Technopark. We request the Government to rectify this anomaly by including representatives of Technopark companies in governance bodies such as the PIB.
11. In order to sustain the current levels of Business, we call for the following specific steps to support the IT and ITES Industry:
a. We request the Government to re-examine the rental regime in the Government-run IT parks and ensure the rentals are harmonized with the recent trends in other metros. We consider that a rental reduction of about 25% is warranted to retain our competitive advantage.
b. We request that the restrictions on electricity consumption is removed and the recent tariff hike reversed, as electricity is the only and most vital raw material consumed by the industry
c. We request the Government to treat Technopark as an Essential Service, as has been done in West Bengal, so that events such as hartals and bandhs do not disrupt the functioning of companies
d. We seek clarifications as to the exact legal framework under which Technopark companies operate. Where new legislation or legal frameworks are to be created, we request that this is done with industry participation
e. While the Government retains the right to examine compliance of companies to the applicable laws, we request that a mechanism for this be instituted within Technopark itself. In particular, we request that the Government does not go public or to the media with such issues in the context of any one or more companies.
f. We request that the current policy regime of the IT Department be suitably modified so as to enable Technopark companies that possess certain minimum requirements to take up e-Governance projects for the State of Kerala and its parastatals.
g. We request that the Government of Kerala to take up with the Government of India in order to extend the STPI Scheme by 3 more years.
i. We request the concessions made to Special Economic Zones be made available to the Technopark as well.
j. We request that sales tax be withdrawn on computer software. We, the companies of Technopark, are confident that the IT and ITES industry will successfully tide over the current crisis. However, for this, we need parity in cost structures with other states and the operational flexibility and freedom to run our businesses. We request the people and the Government of Kerala to support the industry in retaining its operational viability in these difficult times so that the industry can continue to provide employment and contribute to Kerala's progress.
1. The IT Industry in Kerala is estimated to employ a workforce of over 60,000, which includes both highly-skilled professionals as well as non-technical personnel, with Technopark employing approximately half of this workforce.
2. The IT Industry in Kerala had an approximate annual turnover of Rs. 1500 crores last year, with Technopark contributing about Rs. 1200 crores.
3. The global economic meltdown has begun to impact Kerala's IT Industry. The magnitude of impact and its timing will vary between companies. However, the growth rate of the industry is likely to be seriously impacted for the next 1-2 years. In particular, the year 2009 is expected to be the most impacted period.
4. The industry will be forced to take a series of steps in order to tide over the slowdown. The steps that may need to be taken include reduction in operational expenses, reduction or stagnation of remuneration, reducing employee intake, and in rare cases, termination of services of personnel.
5. We affirm that these measures may only be necessary for a limited period, and that the industry will continue to contribute to the economy of Kerala in a significant manner, even during this period.
6. The world over, Governments are coming out with a slew of measures help their industries tide over the present crisis. We call upon the Government of Kerala and the Government of India to adopt supportive steps to help the IT and ITES industries cope with the economic slowdown.
7. The IT and ITES industries have to compete globally, and therefore must have parity in operational costs to retain the global competitive edge. We request that the Government of Kerala act immediately to ensure that the administrative regime in the Government-run IT parks must be enabling and competitive vis-a-vis other IT destinations in the country.
8. We request that the Government does not impose any additional taxes or duties on the industry at this time.
9. We recognize the need for socially justice and equity in personnel policies as articulated by the Chief Minister in the recent meeting with the Industry. We reiterate that large-scale termination of employment will be a last-resort action, to be adopted only when the survival of a company is in jeopardy without it.
10. We would like to point out that collectively, Technopark companies have invested many times the amount of investment made by the Technopark itself. However, the companies have no say in the administration of Technopark. We request the Government to rectify this anomaly by including representatives of Technopark companies in governance bodies such as the PIB.
11. In order to sustain the current levels of Business, we call for the following specific steps to support the IT and ITES Industry:
a. We request the Government to re-examine the rental regime in the Government-run IT parks and ensure the rentals are harmonized with the recent trends in other metros. We consider that a rental reduction of about 25% is warranted to retain our competitive advantage.
b. We request that the restrictions on electricity consumption is removed and the recent tariff hike reversed, as electricity is the only and most vital raw material consumed by the industry
c. We request the Government to treat Technopark as an Essential Service, as has been done in West Bengal, so that events such as hartals and bandhs do not disrupt the functioning of companies
d. We seek clarifications as to the exact legal framework under which Technopark companies operate. Where new legislation or legal frameworks are to be created, we request that this is done with industry participation
e. While the Government retains the right to examine compliance of companies to the applicable laws, we request that a mechanism for this be instituted within Technopark itself. In particular, we request that the Government does not go public or to the media with such issues in the context of any one or more companies.
f. We request that the current policy regime of the IT Department be suitably modified so as to enable Technopark companies that possess certain minimum requirements to take up e-Governance projects for the State of Kerala and its parastatals.
g. We request that the Government of Kerala to take up with the Government of India in order to extend the STPI Scheme by 3 more years.
i. We request the concessions made to Special Economic Zones be made available to the Technopark as well.
j. We request that sales tax be withdrawn on computer software. We, the companies of Technopark, are confident that the IT and ITES industry will successfully tide over the current crisis. However, for this, we need parity in cost structures with other states and the operational flexibility and freedom to run our businesses. We request the people and the Government of Kerala to support the industry in retaining its operational viability in these difficult times so that the industry can continue to provide employment and contribute to Kerala's progress.
