NEW DELHI, INDIA: Presenting the interim budget for the financial year 2009 -10, India's acting finance minister Pranab Mukherjee, said the global economic situation in 2009 may be worse than 2008, and India cannot remain immune to the global financial crisis.

Observing that the current scenario is not encouraging, Mukherjee, who is presenting a union budget after 25 years said that India cannot remain immune to the global financial crisis and the growth rate of exports down to 17.1 per cent in nine months.

Despite the odds India is still the second fastest growing economy, he added. India got a record $32.4 billion FDI in FY08.

The minister also said that six new IIMs would become operational by 2010 and two new IITs will come up in Madhya Pradesh and Himachal Pradesh. Already six new IITs have started functioning in the country during 2008-09, Mukherjee added.

Meanwhile, the Indian IT industry, which is a major revenue and employment generating source for India, has lots of expectations from the upcoming Interim Union Budget.

Some of the existing benefits and incentives for the IT sectors, including the Software Technology Parks of India (STPI) and Export Orientated Units (EOU) schemes will be ending by March, 2010.

The central government has already come out with two stimulus packages recently, but not specifically for the IT industry. However, there's an ongoing debate among the IT captains whether there should be any stimulus package for IT industry or not?

Irrespective of such contradictory views at large, the IT sector is on high hopes from this Interim Budget though no specific sops for the sector has been announced so far.

According to Vipul Jain, Kale Consultants' CEO and managing director, given the current scenario the foremost important step that the government needs to take is to extend the STPI and EOU tax concessions for at least the next three to five years and secondly we need to make Employee Stock Ownership Plans (ESOP)'s a more attractive and flexible retention strategy for the management.

“The domestic IT market has a huge potential and it's high time the industry should be made more attractive for both investments and enterprise spending. More incentives should be made available to end customers in form of depreciation for encouraging IT spending. The income tax concessions should also be on par with software exports,” says Jain.

But will the budget be able to raise up to the expectation? Let's wait and see.