Responding real-time to the threat from Andhra Pradesh Chief Minister Chandrababu Naidu, who is pitching Hyderabad as a more attractive alternative to Bangalore, Krishna announced the setting up of the `Chief Minister's task force' headed by Infosys Technologies chairman Narayana Murthy. Comprising the who's who of Bangalore's IT industry, the task force will catalyse action on various fronts to maintain the city's supremacy in this sector.

Inaugurating the Bangalore IT.Com '99 exposition on Monday, Krishna announced that computer hardware, peripherals, accessories, raw material, and other inputs used in the IT industry would be exempt from entry tax. Manufacturing and trading concerns in the sector would enjoy 100 per cent sales tax exemption with submission of particulars in Form C claiming CST benefits to be dispensed with.

Moreover, proposed IT units in Electronics City (the venue of the exposition) in Bangalore would be exempt from stamp duty, Krishna said. Among the goodies is the exemption from payment of works contract tax on annual maintenance of IT products and equipment.

IT companies can also breathe easier with the relaxation of pollution-control laws: the consent fees payable will be based on any investment in captive power generation sets or other polluting equipment used by the industry, and not on the total capital investment of the industry. The consent will be valid for five years.

On the labour front (another major irritant for IT chieftains), simplification of rules, regulations and procedures on work hours, and increased utilisation of installed capacity, as also filing of registers and records in the electronic medium are on the anvil.

Among the other initiatives are cyber parks to be set up in Mysore, Hubli, and Mangalore to act as incubation units. Krishna also announced the setting up of a separate department of IT to promote rapid e-governance in the state (thank you, Mr Naidu) and ensure continued flow of IT investments.

Taking the IT revolution to schools through a programme for computer literacy, allocating 5 per cent of each government department's budget for IT and e-governance, setting up an IT corridor linking Bangalore to Electronics City, and the proposed IT township near Bidadi are also on the cards.

On the infrastructure front, apart from the cyber parks, Krishna said, ``The state shall encourage international airlines to operate direct international flights to (the) US and Europe from the existing airport.''

That could be a pragmatic approach to addressing the lack of an international airport, which is increasingly looking like a mirage. But the question is how many international carriers will fall for it?

US ambassador Richard Celeste said India was faced with dual challenges: the e-challenge and the x-challenge. The first, he said, referred to the challenge of `e-magination', of going beyond today's limitations, while the other was that of `x-ecution', to deliver on overcoming the first hurdle. Growing and retaining quality people, he added, throwing in another `e', depended on `e-ducation'. The US is the partner country for Bangalore IT.Com '99.