M'sia wins votes for green IT incentives

Industry players welcome US$443 million fund in 2010 budget to drive green IT, but opposition party unimpressed with government's initiatives to boost broadband.

KUALA LUMPUR--IT industry players have applauded the Malaysian government's plans to set aside funds from its 2010 budget, aimed at boosting green technology adoption across the country, but the opposition party remains unimpressed by its "lack of ideas" to boost broadband penetration.

Unveiled by Prime Minister Najib Razak on Friday, the Malaysia Budget 2010 includes a dedicated 1.5 billion ringgit (US$443 million) fund to provide soft loans to suppliers and users of green technology.

This signals the government's move to make sustainability part of the equation in building the local ICT industry, noted industry players, who also gave kudos to various initiatives under the budget aimed at increasing broadband and PC penetration.

The proposed budget also includes income tax and stamp duty exemptions for building owners obtaining Green Building Index (GBI) certificates or buyers of GBI-certified buildings.

Suzie Tan, Symantec's Malaysia managing director, said in a statement: "The 1.5 billion ringgit fund...solidifies the government's effort for the development of green technology in Malaysia. The development of green technology can realize reductions in energy consumption and costs, not just for new investments but also through the optimization of current resources."

The provision is timely because Malaysian companies are ready to make such investments, said Tan. Citing findings from its 2009 Asia-Pacific green IT survey, Symantec said 92 percent of Malaysian companies expected their green IT budgets to increase over the next 12 months. Some 72 percent of respondents said they were working to establish a green IT strategy.

"The funds allocated under Budget 2010 would definitely help companies mitigate the financial burden of going green," Tan said.

Microsoft's Malaysia national technology officer, Dzahar Mansor, said the 1.5 billion ringgit-fund for green technology is "a strong endorsement" for a new economic sector promoting environmental sustainability utilizing technology.

"There are vast benefits to be derived from technology solutions that are both affordable and energy-saving and this cross-section between the environmental and software sectors, in particular, will encourage further innovation and intellectual property development for a healthier, cheaper and more sustainable and responsible way of doing business," Dzahar said in a statement.

Driving broadband, PC adoption
Microsoft's local office also expressed support for initiatives and incentives outlined in the budget, aimed at boosting broadband penetration and PC adoption among civil servants and university students.

The government has proposed that taxpayers be given tax relief on broadband subscription fees of up to 500 ringgit (US$147.7) a year from 2010 to 2012. Najib added that the government will speed up implementation of the high-speed broadband project costing 11.3 billion ringgit (US$3.3 billion). In addition, the country's 1.2 million civil servants can apply for computer purchase loans from the government, of up to 5,000 ringgit (US$1,477) once every five years.

"These initiatives go a long way in addressing challenges of affordability, accessibility and connectivity, and will most definitely contribute enormously to the uptake of Internet usage and broadband adoption within Malaysia," said Dzahar.

The country's ICT association Pikom, also welcomed the government's efforts to boost and rationalize research and development (R&D) and commercialisation grants and patents to enhance productivity and competitiveness of local businesses.

"From the 350 million ringgit (US$103.4 million) allocation to SMECorp, ICT companies will be the beneficiary in terms of loans and capacity-enhancement funding as many of the ICT companies are SMEs (small and midsize enterprises) ," said Pikom Chairman Wei Chuan Beng. "Other SMEs will also be able to capitalize on these funds to enhance productivity and competitiveness, indirectly benefitting the ICT industry as a whole."

Lenovo Malaysia said the initiative to offer a netbook package bundled with free broadband access of 50 ringgit (US$14.8) per month for two years, targeting first-year local university students and low-income families, "bodes well for the government's aim to achieve a 50 percent national broadband penetration rate by next year".

Opposition remains unimpressed
However, not everyone were impressed by the IT-related goodies dished out by Najib's first national budget since assuming premiership. Opposition party, Democratic Action Party (DAP), noted that the government failed in its target to achieve 50 percent broadband penetration by 2008.

"And as Najib admits, [broadband penetration] lags at only 25 percent today," Tony Pua, the DAP's national publicity secretary, told ZDNet Asia. "The recent Oxford-Cisco Broadband Quality study placed us at an embarrassing 48th out of 66 countries analyzed."

During his address Friday, Najib said Malaysia's broadband penetration rate was 25 percent, compared with Singapore's 88 percent, Japan's 64 percent and South Korea's 90 percent.

Pua said in an e-mail interview: "The high-speed broadband project is a recycled project announcement as it has been in existence since 2007. The fact that the prime minister has to include this project again in his 2010 budget speech shows a complete lack of ideas as to how we are to achieve the revised 50 percent goal by 2010."

He added that the tax relief on broadband subscription benefits only some 1.8 million or so tax payers, who are among the higher income group and hence, are likely already broadband users.

"What would have [been more effective] would be direct grants or subsidies to new subscribers, which have not signed up for broadband accounts," he said.

Lee Min Keong is a freelance IT writer based in Malaysia.