BUDGET REACTIONS - Industry speaks

Sanjeev Keskar, Country Mana-ger, AMD Far East Ltd: The Finance Minister has
presen-ted a forward looking budget that provides a big impetus to the Indian
hardware industry, by bringing down the cost of IT hardware and creating a
larger domestic market by identifying technical educa-tion as a thrust area. By
aboli-shing the excise duty on com-puters from eight to zero percent, the
Finance Minister has significantly reduced the cost of owning a PC and I exp-ect
this to act as a trigger for the large-scale proliferation of PCs turning them
into com-mon household devices.

Vinnie Mehta, Executive Director, MAIT: Reduction in excise duty from eight
to zero percent on PCs is indeed a wel-come step. This will have the positive
impact of abolishing the grey market and make IT products from the organized
sector price competitive. We believe that this will help deepen the existing
market and improve IT penetration in the country. We wish that a similar measure
of zero excise duty were also adopted for IT peripherals, as a consumer today
buys a package-PCs and peripherals together, rather than a stand-alone system.

Ajai Chowdhry, Chairman and CEO, HCL Infosystems: We are happy that the
Finance Mini-ster has taken a special view of IT manufacturing in India, by
reducing excise duty from eight to zero percent on PCs, including PC components.
This step assumes even more signi-ficance, as it has come ahead of the WTO zero
duty regime.

Ashish Chowdhary, Country Head (India and South Asia), Nokia Networks: From a
tele-com perspective, this year's bu-dget reflects the government's focus on
telecommunications as a key infrastructure sector and its efforts to provide
impe-tus to one of India's fastest gro-wing industries. The initiatives to
raise the FDI limit and exe-mpt MSCs from import duty are a welcome move and
will help mobilize much-needed invest-ments and drive down the cost of telecom
equipment, further accelerating overall growth in the sector.

Rangu Salgame, President (India and SAARC), Cisco Systems: The Finance
Minister mentioned the need for thou-ght and passion in governance and his
proposals reflects encouraging investments acr-oss all key sectors of
infrastru-cture, industry, agriculture as well as services. The proposal to
increase telecom FDI to 74 percent is a welcome step. The move to abolish duties
on PCs as well as rationalization of duties on telecom infrastru-cture is
positive.

Ravi Venkatesan, Chairman and GM, Microsoft Corporation India: I feel that
overall this is a good budget. The Finance Mini-ster's decision to allow a
full exemption of excise duty on computers is a very positive step towards
accelerating the overall PC penetration in the country. The increase of FDI in
the telecom sector as well as concessions given to the cellu-lar service
providers will give the much needed fillip to the telecom sector in the country
as well as drive broadband penetration.

Neeraj Chauhan, Director (International Operations), eSys Distribution:
Abolition of the eight percent excise duty on complete systems shall help to
bring the prices of PCs in the country closer to international levels and may
act as a trigger in next level of PC penetration in India. Indian PC market
shall almost double to seven million units a year, in the next two years and
current measures in the budget shall only facilitate this.

Gopal Srinivasan, Director, TVS Electronics: It's a positive move by the
government to abolish the excise duty completely on PCs. It is a pro consumer,
pro marketing, pro development move by the government and we can expect five
percent to seven percent drop in PC prices due to this. This will also increase
the annual growth rate of PCs from present 34-45 percent. All the people
oriented programs announced by the UPA government needs IT for effective
implementation and speedy completion of projects.

Jitendra Kulkarni, CEO, Redin-gton (India) Ltd: The abolition of excise duty
will really help the growth of branded PCs in the market. There will be mini-mum
drop of six percent in the branded PCs, which will help for the shift of buyers
from assembled to branded compu-ters. The exemption of income tax for salaried
class below Rs 1 lakh will increase the dis-posable income among this group.

BN Agarwal, Director, PCS Industries: I feel that the redu-ction is not
likely to be more than one or two percent on the total cost of the PC. The
reason, as we understand, is that the excise reduction is getting adjusted
against the unclaimed MODVAT of the components that go into making the finished
product.

Raj Saraf, CMD, Zenith Com-puters: This budget announ-cement will now make
the computer more accessible to the consumer, which has always been Zenith's
dream. With the complete waiver of the excise duty we foresee a definite drop in
PC prices by 10 percent. It is the customer that will ultimately emerge as the
winner. Hardware manu-facturers have been lobbying for the reduction and the
welcomed budget announ-cement is a step towards India becoming high-tech
super-power in hardware too.

(CyberMedia News)