IT Taskforce
Basic Background Report



A. Framework for Information Technology Research, Design and Development

The working Group on IT Research, Design and Development has made the following recommendations :

Information Technology is one of the youngest and fastest growing technologies that is affecting our daily lives. Introduction of IT is changing our operational practices and thinking process, and is taking us to the new Information Age. IT also has enormous influence in the global economy. There is growing appreciation of the role of IT in enhancing productivity and competitive advantage.

With the globalization of economy, the strategy of conducting business is fast changing. The emphasis is on cutting down the RD&D cycle time. Provide newer services and products to remain ahead of the competitors. This has led to technology driven business. Thus making technology more precious than ever before for the growth of economy.

In today’s context therefore, technology takes center stage both from strategic point of view, involving national security and from commercial point of view, to make India a global player. There is a great need to seriously encourage RD&D in sunrise technologies like IT both in government and private sector. It is important to provide large public funding to RD&D in IT sector to achieve the ambition set by the Prime Minister to make India an IT superpower by 2008.

To meet the challenges of the new global competition and to boost the indigenous RD&D in IT, it is important to create an ambience in the country for RD&D to flourish. An effective IT RD&D policy instrument needs to be in place to provide government participation in various forms of incentives and other fiscal and regulatory provisions. It is also essential to build partnerships between government funded research institutions and private industry. An environment for RD&D to grow also needs effective linkages with its commercialization, manpower development and availability of financial resources

Every country has problems, which seem similar to the ones faced in other countries. However each one of them has some specific component which makes it unique. Every country therefore has to work out context specific solutions, which are unique to the country. It is extremely important and critical to identify and promote certain initiatives for uniquely Indian solutions for uniquely Indian needs. These initiatives could also become trendsetters in other developing countries and give berth to Indian technology.

RD&D is a knowledge-intensive activity. It is also a multi-disciplinary activity having linkages with many fields of specialization. High-end research therefore needs cutting-edge specialist manpower in a number of disciplines. It is of vital importance to develop such a specialized manpower in the country, retain them in India and provide them scope/facility to work on RD&D with medium-term and long-term specific goals.

It is a well-known fact that the investment made in RD&D gives highest rate of return. However investment in IT RD&D is characterized by very high risk. This is because there are many other steps in the product evolution cycle, which should also be organized before the product becomes profitable in the market. Most Indian Industries and RD&D institutions run out of steam during the product evolution cycle. Funding for RD&D therefore becomes a very critical issue in the developing countries. Most of the RD&D funding in India come from Government of India in the form of support to a large number of RD&D and academic institutes. This funding is mostly for strategic reasons and not for getting maximum return-on-investment (ROI). RD&D funding by Private Sector Indian Industry does not seem to be significant either in quality or quantity.

The current government efforts towards development of IT technology in India are limited to "capability and awareness building exercise" and strategic research and development. There is very little link between the current RD&D efforts and the industry, which is so vital to ensure sustenance of technology development. It is clear that there is a need to put major efforts to encourage RD&D as a primary tool that can hasten the process of economic development in India.

Indian IT RD&D capabilities can be very effectively used for the "product- development". However one of the major hurdles faced in sustaining the development is absence of "global marketing channels". One of the ways to build such a channel is to acquire appropriate companies abroad. These companies by themselves, could be profit making. Marketing channels of this company can used to market the new products. Funding for such a venture could come both from financial institutions and government. There is an urgent need to encourage such a concept to make India a global player in IT in a short time.

Successive policy announcements of the Government, during the past few years, have unfortunately reduced most of our once RD&D oriented IT industry to mere trading activity. We need an IT products industry that can stand on its own, rather than be dependent solely on import of technology from abroad. There is therefore an overwhelming need for government to re-invigorate India’s Research Design & Development (RD&D) capabilities in IT. Further delay in encouraging such capabilities could rapidly diminish the nation’s economic, military, and life-quality standards.


1. Setup a High level Institutional framework to coordinate and focus RD&D efforts in the country. This should help in facilitating formulation and implementation of policy framework on on-going basis for RD&D in IT; take note of present efforts, identify and coordinate implementation of mission mode foundation projects in products, processes and technologies; and to monitor and steer the RD&D activities on on-going basis. This effort needs to be coordinated initially by the Government with active participation of Industry.

All government funded RD&D organizations should be encouraged to formulate long term and short term IT action plan and share it with the above mentioned Institution to facilitate coordination and maximize the benefits flowing from it.


2. Establish an Indian IT Design Council as a non-governmental, autonomous body that would

  1. institute awards for excellence in R D & D in IT;

  2. create awareness among Indian RD&D community towards protection of their Intellectual Property and provide patenting assistance to developers;

  3. institute a "Designed with Pride, in India" mark for IT products designed and developed in India;

This Mark could have different "levels" (such as Silver, Gold, and Platinum, depending on the exact design content – Platinum being the highest).

3. Setup an Information Technology Development Board (ITDB) as a non-governmental, autonomous body that would

  1. Identify major mission mode projects in the country for building Information society and meeting the goals set for socio-economic development. Also, with a view to developing Indian solutions and going up the value chain.

  2. Build close links, to encourage collaborative activities, between academia, funded RD&D organizations and Indian IT industry.

  3. Fund projects to help develop technology in high-risk areas.

  4. Keep a watch on global IT technology trends and India’s competitiveness in the field.

  5. Establish an appropriate funding mechanism for IT industry to draw support for RD&D.

4. A corpus fund be created by the Government of India for the IT sector.

This should act as corpus fund for various funding agencies. The funding could be through pure equity, convertibles, convertible preference shares, venture finance etc. to the companies at the seed stage.


5. Setup following measures for the development of cutting edge manpower for RD&D:

  1. Masters’ programs in IT should be extended to two years, from the present one- and-half years to improve the quality.

  2. Ensure that all undergraduate and postgraduate colleges offer a "minor" in IT, with view to encourage development of IT based knowledge in various fields like medicine, commerce, economics, law, engineering, natural sciences etc.

This will minimize their migration to basic programming field.

  1. Institute fellowships and special faculty positions schemes with attractive remuneration to ensure that high quality manpower joins academics.

  2. Create a national infrastructural research programme in Information Technology along the lines of existing programmes in Physical, Mathematical and Nuclear Sciences.
  • To create R & D manpower and infrastructural facilities

  • Should provide research positions in selected institutions and also provide fellowships for short and long durations in various academic institutions
  1. Create an appropriate funding mechanism to encourage basic and applied research in Academia and Research organizations
  • To sustain R & D programmes in academia and research bodies (At present, no funds are available for basic research in IT-related areas.)

  • To support open-ended research in IT-related areas
  1. Design a set of measures to attract high quality students and faculty into IT-related areas.
  • Encourage industry to set up attractive fellowship programmes for postgraduate studies in IT-related areas

  • Encourage enhancement of qualifications and acquisition of R & D qualifications by R & D staff from the industry
  1. Institute a national level collaboration programme between the academia and the academia and the Industry.
  • To support exchange programmes and collaborative activities between the academia and the Industry

6. Establish an Indian Institute of System-Level Integration, which will carry out leading-edge research in SLI:

  1. Establish an SLI think-tank;

  2. Offer post-graduate degree course(s) in SLI.

  3. Help create an IP Bank in India;

  4. Help India become a major source of IP.

  5. Tie up with major semiconductor fabrication facilities world wide, to provide prototyping/production facilities and/or license the IP.

7. Setup an agency to evolve Framework of standards viz. CMM, SPICE, ISO9000 etc. This agency should also work for assessment and certification for compliance to standards and processes at affordable cost.


8. Set up easily accessible Patenting cells to provide both consultancy and actual patenting/ copyrighting services to IT professionals.

9.    Establish Tool rooms and design support centers for providing modern tools to the developer community at a reasonable cost. Further, ensure development of Indian tool sets for the above purpose. Initially the following areas could be considered:

  1. Setup "CAD tools" Research Design & Development and dissemination center, with a view to provide state-of-the-art CAD tools to Indian Industry and explore global market for export of Indian CAD tools.

  2. Set up educational/exploratory software development center with the responsibility of building educational/training software for giving advance training to scientist and engineers.

10.    Institute Specific projects for IT interface and IT development tools in Indian languages. These projects could be used to set up Indian standards.

11.    Setup following fiscal and operational measures to boost growth of IT RD&D:

  1. Allow Courier Services for imports with customs clearance at the addressee location. Further customs duty exemptions allowed to addressees that are EOUs or EHTPs, STPs, S-BITs.
  1. Exempt all IT products that have been designed indigenously
    ( carrying "Designed with Pride, in India" mark, from all duties such as CED, CST, State ST, Octroi, Customs duty, CVD, AD etc.
  1. Amend RBI and Enforcement Directorate rules, requiring realization of export proceeds with in 180 days to 365 days shipment. The audit of these transactions could be post facto.

  2. Permit return of exported goods/software unsold through distribution network or permit sale of such goods on discount in the exported country.

  3. Export revenues from royalty on Indian RD&D must be made tax-free to encourage intellectual capital creation.

  4. RBI should authorize equity funding as well as Collateral-free loan at preferential interest rate for RD&D activities, leading to IT product development (as recommended for IT manufacture in the IT task force report) .

  5. Such funding should be at internationally competitive interest rates to provide a level playing field.

  6. RBI be asked to notify guidelines to accept intellectual property as capital asset created via RD&D and be value based on the actual expenses for manpower, material and over heads.

  7. Include Intellectual property at par with goods and services and allow capitalization on the above. Amendment to clause 48 of hardware report.

  8. Allow stocking distributorships for imported components, by according S-BIT status to component distributors.


  1. Each Department should establish Mission mode, area specific programs, involving indigenous development and large scale deployment where private investment is not feasible due to high risk factors, with assured procurement commitments to the developers.

  2. The service rules for government employees and academics should be amended so that they can start up companies to take advantage of the intellectual property developed by them.

  3. Give purchase preference in Government procurement, to the products carrying " Designed with Pride, in India" mark, as long as they meet the Quality and acceptance criteria.

  4. Establish a National Institute for Information Security (NIIS) (as envisaged in recommendation no. 69 of IT action plan Part I ) to:

i. Carry out research in IT security as applicable to India.

ii. Coordinate with other organizations in the country involved in similar RD&D efforts

iii. Establish standards for IT security at different levels for India

iv. Provide IT security solutions for different applications in the country.


  1. Following areas are recommended for long term open-ended research and mission mode projects:
  1. Theory and implementation of fundamental algorithms.

  2. Programming languages, program translation

  3. New programming paradigms and software architectures extending object-oriented design techniques.

  4. New semantic models and paradigms for data bases.

  5. Distributed computing.

  6. Mathematical basis of computation.

  7. Application of computer science to natural sciences such as physics, chemistry, biology, genetics, and to mathematics.

  8. Application of computer science to decision support, data mining, operations research, financial analysis and economic modeling.

  9. Application of computer science to medicine. This includes medical research, medical instrumentation and delivery of medical services.

  10. Application of computer science in creative arts and music.


This "Framework for RD&D" enlists a set of policy guidelines. It is expected that Implementation Group will keep in mind the strengths and achievements of existing mechanisms and organizations while working out the implementation plan, with a view to harness their strengths to achieve the objectives.

B. National Technology Park (NTP)

The Ministry of Defence has made the following further recommendations/suggestions concerning IT RD&D:

17. The concept of National Technology Park (NTP) will be encouraged for R&D and promotion of key technologies to support establishment of National Information Infrastructure.

18. Departments concerned with core technologies will provide infrastructure support to enable integrated development. These Departments will evolve necessary procedures for development, transfer of technology, manufacturing and post deployment support.

19. An Inter-department committee will be established to formulate policy and programme to evolve/adopt national standards for Information Technology in consultation with Bureau of Standards and will submit its report in 90 days.

20. To enable India to be a global competitor there is a need to enhance the velocity of business and quality of products. All PSUs, R&D Institutions and Technology Support agencies will apply techniques of resource planning and initiate time bound programmes to modernise their units.


21. Government recognises the need to manufacture IT products in consonance with the open system interconnect model. The Department of Electronics will institute measures for its revival and sustenance at world class level.

22. The scope of civil defence will be enlarged to include Cyberspace. To manage the Cyber related threats and disaster recovery measures, a National Information Infrastructure Security Agency under the National Security Council will be constituted.

23. Government will encourage and participate in joint ventures in Microelectronics, Surface mounted devices and professional grade components required in the field of Information Technology.

24. Appreciating the demand of rapid change in IT industry, the Government will suitably amend Laws to enable relocation, reorganisation and retraining in the IT industry.

25. In pursuance of the stated objective of 1% to 3% of Budget for IT, all Departments will make their IT Roadmap 2008 and, will promulgate milestones along with yearly financial projections to meet their targets.

26. To keep pace with the Rapid developments in the field of IT, the Government will revise procedures for clearance of IT related projects in 4 to 6 months.

C. Software Tool Rooms and Design Support Services

27. The WESEE of the Ministry of Defence has made the following recommendation regarding Software Tool Rooms and Design Support Services:


The National Taskforce on Information Technology (IT) and Software Development (SD) has identified Software Enabled Services (SES) sector as one of the possible niche area for the export and self-reliance in high-end information technology products and services. This vision has been driven by the availability of english-speaking, trained and comparatively cheaper technical manpower in India. While examining this issue in detail the Task Force had also addressed the need for raising the present productivity level of Indian software engineers and domain specialists from present range of $ 15,000-$ 40,000 to $ 150,000-$ 200,000.

The Task Force noted that high level design, simulation, control room prototyping covering a large spectrum of engineering disciplines, metrics, validation, pre-prototyping, proof of concept etc. are very well suited to the professionals skills available in the country.

The Task Force was also appraised by industry representatives about experience of some of the early entrants into the overseas market in Electronic Design Automation (EDA). Computer Aided Design (CAD) and similar other areas. It emerged that many of them have exported market savvy designs of automative products, model evaluation and complex design validation solutions.

Software Tools – Enormity, Spread and Complexity:

The field of Computer Science and Technology has evolved itself into a large number of distinct disciplines at various levels of pure sciences, technologies, products, systems and services.

The development at each level is perceptible and deemed completed when the mathematical efficacy underlying its evolution is repeatedly verifiable scientifically. This requires use of a large number of tools which can assist the very process of design, development engineering, production, testing, integration, validation, verification, quality assurance, packaging, documentation, training, end-usage and so on; not only for micro electronics but any other conceivable product. The list of these tools in indeed is very large.

Today the tools have become the mainstay of Information Technology and its applications in each one of its facets. The use of these tools is not only inescapable but no individual, group, company or agency engaged in IT enabled developments can undermine their critical role. In terms of economics and competitiveness in technology, today, no society or nation can ignore judicious use of software tools. Therefore for India to be an IT Super Power, the penetration of tools in our IT environment are as critical as power supply to our information systems.


Use of Software Tools vis--vis Penetration level in India:

The work culture in development of high-end technology, products and services in any area requires use of software tools, state-of-the-art workstations, PCs and other support products and services. The high-end tools in the form of Software Engineering Environment (SEE) for design of real time systems, Concurrent Engineering Environments (CEE), Computer Aided Design (CAD), Computer Aided Manufacturing (CAM), Electronic Design Automation (EDA) etc. have been available in the world market since early nineties. However due to their high cost, the penetration in Indian market has been negligible when compared with USA, Japan and European countries. As a result very few large installations are available in both government and private sectors.

In addition to the initial higher cost, the obsolescence with version level if cycle of 1 to 3 years makes the use of these tools unaffordable for the smaller companies. This is found to be the primary reason that the professional companies despite being able to pool together requisite talent and skills are not able to enter local as well as overseas market. It is therefore necessary to find an affordable solution to circumvent this problem and evolve a promotional framework at national level for meaningful penetration of these tools. It also emerged that there is potential for considerable export earnings if skills and tool based infrastructure and support services can be created in the country. This can become one of the mission areas as identified by the National Task Force for penetration of Indian IT industry into the export market.



A strategy is presented to create comprehensive "Software Tool Rooms and Design Support Services" at strategic locations including the Software Technology Parks, PSUs, DRDO laboratories and in Corporate Sector to enable Indian potential design agencies, industry and individuals to undertake high-end design, simulation, system engineering, control room prototyping etc. on turn key basis within India as well as penetration into the overseas market in consonance with the intent and aspirations of the country to become IT Super Power by the year 2008.

Tool Room Objectives and Potential Applications:

The Tool Room and Design Support Services Centre may offer a wide spectrum of services such as design and development, training, consultancy, software-housing, buying-house, design bureau etc. to a large number of dissimilar, diverse and widely dispersed environments to suite the needs of individuals, work-groups, industry and institutions.

Frame Work Based Solution Strategy:

It is proposed that suitable market specific centres be created at strategic locations throughout the country in the form of "Software Tool Rooms" and "Design Support Services" (STR & DSS) centres. These facilities may be licensed for online use by the individual enterpreneurs, design teams, institutions, government agencies industry etc. The types of tools and services can be mixed and matched to suit the local needs of end users. The facilities should offer world class, state-of-the practice tools and services at affordable cost.


Scope and Diversity of Services:

The scope of functionality, services and facilities in these Tool Rooms and Design Support Services are further amplified in the succeeding paragraphs.

(a) Design and Development: The Tool Rooms can provide selectable configurations of computer Aided Software Engineering for high-end real time software development, Computer Aided Design of components/systems, Computer Aided Manufacturing, Concurrent Engineering Environment, Electronic Design Automation (EDA) etc. for those individuals, teams and companies who cannot afford to have their own independent facility for economic compulsions but wish to reach overseas software market. A central, ready-use, tool centre to serve the needs of design and development teams owned and operated by individual interest groups or companies located in a STPs, office complexes or in any distributed locations can serve this purpose.

(b) Training: The Tool Room can be used to configure suitable "Training Systems" using same tools and provide state-of-the-art training to own teams, client teams or general category of personnel in their respective niche areas. This training is intended to integrate domain knowledge in various professions viz. Engineering, electronics, medicine, law, arts, crafts etc. with the information technology enabled products and services. Training systems can be created as a by-product of design and development facility with marginal additional cost.

( c ) Consultancy: Tool Room’s "Design Support Services Group" can provide consultancy in any of the respective areas viz. Software engineering, quality assurance, configuration management, reviews and audits, costing assistance, packaging of products, documentation etc. Depending upon the experience gained, the services offered by these centres can include project management, maintenance of corporate data model, guidance in data administration, data warehousing and mining, systems prototyping, proof testing, processes etc. for those who cannot afford to put together their own in-house teams to work in the above mentioned areas. Software Contracting services in the weakest area in India. This assistance can be provided centrally by these centres.


(d) Central Warehouse/Library/Exchange Forum/Buying House: A one-in-many facility the "Tool Room" and Software Support Services Centre" can provide following services.

  1. A central repository where information about products, tools and services available from the Tool Room, other native users of the Tool Room or external agencies throughout the world can be pooled together and provided to its users on as required basis including a virtual library.

  2. This facility can also become a "Buying House" for the products and services developed by its native users. The idea is that spin-offs of products developed by one agency should be utilized by many others. The facility can be used to cross-fertilize the ideas and innovations through new design initiatives.

  3. The facility can become a focal point for exchange of ideas and information amongst users of other "Tool Rooms" through-out the country at minimal effort, expense and inconvenience and hence promote awareness, competition and knowledge sharing attitudes. The facility can be viewed from the point of view of a forum or even at global level to exchange high value research goals as well as results.


  1. The facility can also be promoted as a "Buying House" for government to government exchange assistance to other developing countries or a single window voice for promotion during major events by CII, NASSCOM, etc. It can be promoted as software component store by major consultants at international level who can advise their clients of such products available from India.

  1. Each Tool Room can become Internet site for e-commerce for its own products and can hoist its own web-site.

  2. The facility can become a single window training as well as a research-exchange avenue for universities and institutions which otherwise cannot have access to such costly tools.

  3. The facility can promote a culture of collaborative research and development.

  4. The facility can become a centre to service overseas clients in more than one discipline of products and services at a single window which otherwise is difficult economically.

  5. With right initiatives the "Tool Rooms" can become the centres of attraction for world player in software tool development market as a business focus, promotional avenue, research inputs and investment interests.

  6. The facility can provide nodal assistance to its users for IPR and patents. Also it can provide one stop information booth for patented products in similar areas of work.

  1. Design Bureau: All the Tool Rooms and Design Support Services Centres can be inter-networked amongst themselves and with any other national agency. The QAI (India), Bureau of Standards (India), consultancy companies etc. can become a part of this network to offer packaged services on the lines of major design bureaus.


Proposed Architecture and Configuration of the Facilities:

Software Tool Rooms: The Software Tool Rooms can be created encompassing the following:

  1. Software Engineering Environments (SEE) for development of high-end real time software systems in consonance with functional/structured approach.

  2. Software Engineering Environment (SEE) to cater developments in above areas using Object oriented Approach (OOA).

  3. Knowledge Engineering Environment (DEE).

  4. Concurrent Engineer Environment (CEE).

  5. Computer Aided Design (CAD) centre

  6. Computer Aided Engineering (CAE) facility

  7. Computer Aided Manufacturing (CAM) services

  8. Electronic Design Automation (EDA) centre

  9. Miscellaneous Tool Kits for mathematical analysis, flow diagrams, instrumentation, metrics, network design and testing etc.


Software Related Design Support Services : As part of the Tool Rooms, it is also proposed to provide Tools and Design Support Services to enable the following.

  1. Transitioning design to production through formal Transfer of Technology (TOT) package.

  2. Installation of standards and their compliance, (typically IEEE, ISO, CMM, DOD, MIL etc.)

  3. Booths for the following canned services:

  1. Configuration Management

  2. Quality Assurance

  3. Reviews and Audits

  4. Documentation & packaging

  5. Certification Metrics

  6. IPR and Patents

  7. Help Desks

  1. Reusable Software "Library and Exchange Centre".

  2. Project "Consultancy Services".

  3. Tool delivery centre for "High-end Training".


Design of Tools and their Export Potential :

The penetration of software tools in India has been marginal when compared with world market. Consequently the awareness level has been very low. On the other hand due to the inherent complexity in design and scientific bearing, these tools are difficult to produce and therefore are very expensive. It is perceived that once these tools begin to be used commonly in our work centres, our facilities become beta sites and the tool vendors recognize the potential of our talent; India can become an oasis for development of these tools. The idea is that like other forms of software, the tool vendors may utilize India as a potential development-cum-out sourcing base or simply an offshore site for tool development. The national talent can indeed meet this challenge. This would of course require considerable hand holding by DOE, NIC, NASSCOM etc.

Tools are germane to developments in a competitive world where cycle times for even major products are shrinking from years to months. Some complex engineering solutions are not even possible without the use of modern day software intensive tools. The penetration and usage of these tools in India has remained at low key primarily due to high cost, faster obsolescence rate and lack of opportunities for their use.

The National Task Force on IT and SD, has identified export of high-end design of various products as a possible mission area for promotion. These designs would require use of software tools, which are expensive and need to be imported which makes their penetration and usage unattractive.

A framework is suggested based on the building block concept where by these tools can be centrally procured and integrated in the form of "Software Tools Rooms and Design Support Services" and, offered for use by individuals, work groups, teams, industry and institutions. The National Task Force on IT and SD recommends implementation of this concept on a national scale. The concept if implemented with care and caution can become the lynchpin to boost exports and create inherent strengths in the design of world class products in the country. This initiative will require higher initial investments and promotional efforts on the part of national agencies viz. DOE, NIC, CII, NASSCOM, MAIT etc.