(i) Nearly 40% of the employees in the hardware industry are engaged in the development of software and hence, it is critical that the stock option plan extended to the software industry employed is also made available to the hardware industry employees.
Employees Stock option schemes for stock listing in India would also be encouraged. Also, clarification shall be issued that income tax is applicable only at the time of sale and not at the time of exercise of option.
Dollar Linked Stock Options to employees on Indian Software companies were announced in the 1998 Budget and detailed guidelines on this have been issued by DEA, Ministry of Finance. This shall be modified in accordance with the definition of IT products and IT services given under (19)(a) and (b) above.
Amendments shall also be
made in the Company Law to provide for buy-back of shares
as well as differential pricing of shares..