STPI looks at repositioning itself

With IT & ITeS firms moving to SEZs, STPI now eyeing MSME & start-ups

With registrations for units by Indian IT services sector dwindling at the Software Technology Parks of India, it is now trying to reinvent and make itself more relevant to the small and medium companies and the booming start-up eco-system.

STPI, that has over 10,000 units in India with almost 3,000 exclusively exports driven, has already commissioned about 10 lakh square feet for development which will be available to lease in the next one-and-a half years. Most of these units are coming up in the tier II and III cities like Bhopal, Indore, Mysore and others.

“For Fy14 we will have atleast 10 new centres coming up. We have seen drop in registrations as companies have moved to SEZ. But the positive news is that we are still seeing registrations. For FY13 exports from STPI all across India was Rs 2,51,000 crore. This represents a growth of about 7%. And we expect to have similar growth going ahead,” said Omkar Rai director general, STPI.  

In FY12 STPI saw 39 units registering, this has come down to 20-22 for FY13. According to reports almost 1,000 export units had withdrawn their registration as tax exemptions were discontinued after 2012. STPI, offered tax exemption to export oriented units on profits under Section 10A and Section 10B of the Income Tax Act.

But the National policy of IT and Electronics has envisaged a new role for STPI, wherein they can provide support to start-ups by supporting the entire lifecycle of entrepreneurs. The incubation facilities in the STPI centres will provide entrepreneurs with facilities such as ready to use plug-and-play facilities.

“ Other than providing plug-and-play environment we have also proposed providing risk capital for start-ups. Our support is not only to help entrepreneurs built a company but also take them to market and to aid them is raising further funds from venture capitalists,” added Rai.

The maximum contribution of export revenue comes from STPIs in Karnataka, which reported exports of Rs 80,000 crore for FY13. Followed by Maharashtra at Rs 51,000 crore. Within Maharashtra, Pune has recorded highest exports generated at around Rs 29,000 crore, followed by Mumbai at Rs 21,800 crore, Nagpur at Rs 215.85 crore, and Nashik at Rs 112.36 crore.

Even though STPIs are looking to focus on start-ups they would focus at product companies with focus on both exports and domestic market. “India is expected to become a $400 billion electronic market by 2020. To be able to achieve this we need to provide support to such firms. The government has already made a few announcements like two wafer fabs have been approved, seven manufacturing electronic hubs have been identified among other measures,” said Rai.

Rai is also confident that STPI in no way has lost relevance after the IT exemptions have been discontinued. “We still provide ease of procedures, duty-free imports etc. We have also recommended for further simplification of procedures,” he added.