In order to be successful, India must actively promote its technical skills and innovation. Government Leadership First, tax policy is an area where government can help to play a key role. The U.S. Congress recently passed a three-year moratorium on enacting any new taxes on Internet commerce. In the U. S., there has been a battle for the past year over the state's right levy new taxes on Internet transactions versus the federal authority to protect trade. In general, the federal government has a hands-off policy while the states are very concerned about losing a huge tax base.
Tax policy is an area where the Indian government has the opportunity to take a leadership role.
The recent decision to expand the licensing to Internet service providers and to reduce licensing fees is sending the right message to the world community. The next step is to lower the telecommunication costs for accessing the web. Current costs are prohibitive to fast growth. The Indian government has set IT and the Internet as two of its principle economic platforms for growth. While business is typically going to be the source of innovation, government can clearly lead the charge with implementing its own services and information on the Net.