The measures, he said, will allow 49 percent foreign equity in joint ventures with Indian Internet service providers.

Speaking at the inauguration of the five-day mega information technology event here, the Prime Minister said the policy will come into effect on November 7 when private Internet service providers will be issued licences.

For making Internet services affordable, the service providers would be given licences free of cost for the first five years. Thereafter, the licence fee would be Re 1. He said the Government was working out modalities to permit use of INSAT capacity by private service providers and privately-owned satellites registered in India to promote distance education, information technology and businesscommunication.

Vidya Vahini Network (VVNet), to be set up by the IT Task Force through an ``appropriate body'', will be another new scheme which would synergise all the planned intranets between the University Grants Commission, Council for Scientific and Industrial Research, Ministry of Human Resource Development and State-level networks.

The first phase of the VVNet would be operational by August 15, 1999. The network would be a unique satellite-based and land-based communication that would place India in the forefront of network education, he said.

The Prime Minister also announced the sanction of an international airport at Bangalore soon after Chief Minister J H Patel made a strong plea for it.Civil Aviation Minister Ananth Kumar said directs flights from Bangalore to San Francisco via Singapore and to New York via Europe would commence on January 1.

Earlier, Vajpayee said the achievements of the country's software companies, professionals and entrepreneurs had reinforced his belief that Indiais destined to become a software superpower. He said the country's first ocean satellite IRS-P4 would be ready for launch early next year which is also expected to witness the maiden test-flight of GSLV rocket for launching geo-stationary satellites.

No expansion: PM