Finance Minister Yashwant Sinha has underscored a strong point that India indeed has a new mantra and that is, information technology (IT). This mantra has its roots in the "passionate and strategic infection" spread by the unrivalled success of India's export-led software industry.The first feeling after listening to the Budget was "a great sigh of relief" for the industry. The relief came from the fact that the finance minister scotched all rumours and did not withdraw any incentives. In other words, software exports continue to get exemption under Section 80 HHE of the Income-tax Act. This no doubt will help translate into yet another 50 per cent growth year for the industry.As per Nasscom estimates, the industry in the year 1999-2000 is expected to gross Rs 17,500 crore or $4 billion.The second point of relief was that although the finance minister does not believe in concept of zero duty regime, he has left computer software outside the purview of customsduty.On the other hand, the argument is that even if the finance minister had imposed duty, it would have caused problems in its implementation, as the new methods of delivery through the internet almost make it impossible to impose import duty on software.At the same time, the finance minister should be given adequate accolades for giving a great boost to the domestic software market. He has clarified that service tax is not applicable on computer software development. This means no more hassles of excise inspectors troubling domestic software players. At the same time, in a revolutionary step, to help Indian corporates gear for the year 2000 problem, the finance minister has allowed all expenditure incurred by the corporate sector in making their systems Y2K compliant to be allowed as revenue expenditure in the next financial year.To boost software product development, the finance minister has also relaxed venture capital norms. He has included computer software under Section 35 2AB of the Income-tax Act.

This will give a boost to R&D software product development in the country, as software products and packages initiatives will get 125 per cent weighted income-tax deduction till 2005.The Budget has provided a boost to venture capital environment also. The FM has also recognised importance of ESOP in the sunrise sector. Here, he seems to have gone by the recommendations of the JR Verma committee. Here, he has said no tax at the time of offer; but ESOP will be taxed as a perquisite, when the employee exercises the offer into an option and transfers the stock in his name. Later, if he chooses to sell the stock, then the capital gain tax is applicable. ESOP is an important instrument for software industry to retain its valuable manpower.But, the promising note of the FM's speech was that he was speaking `Dil Se' and was concerned that the film industry should not say, `Hum Apke Hain Kaun'. The lobby of I&B minister Pramod Mahajan has really worked and a new section 80 HHF has been introduced for income-taxexemption to export of film, movie and music software. It is great news in this era of convergence wherein content development would become a major industry in our country and export of such content would not only bring valued foreign exchange, but also provide great amount of employment in the country.Overall, the Budget was music to software industry. As somebody said, "S for Sinha; S for software and S for superpower". One should see another year of 50 per cent growth in software sector.