Japan is drawing up a five-year plan to surpass the United States as an Internet powerhouse through massive investment in high-speed infrastructure and scuttling laws that inhibit e-commerce.

Japan is drawing up a five-year plan to surpass the United States as an Internet powerhouse through massive investment in high-speed infrastructure and scuttling laws that inhibit e-commerce. Despite its technological prowess, high costs and a plethora of legal restrictions have prevented Japan from having its own Internet revolution - and officials are worried the new economy will pass the nation by. The government's IT Strategy Council, which opened this week under the leadership of Sony Corp. SNE president Nobuyuki Idei, said if steps are taken now the Internet could lead Japan's bruised economy into a new era of super-fast expansion. "Our country must aim to accomplish a new period of rapid economic growth by stimulating new businesses and existing industries, and overtaking the United States within five years as a major high-speed Internet nation," the council said in a report posted on the Prime Minister's office Web site. The council said it is essential to grid Japan with fiber-optic lines that will permit the high-speed transmission necessary for growth of the Internet. It was scathing in its assessment of the current state of Japan's information technology infrastructure. The council cited more than 700 legal impediments to the growth of e-commerce, including the obligatory exchange of paper documents in Internet transactions. It highlighted the urgency of immediate steps to jump-start Japan's laggard information technology industry by recommending that laws to deregulate e-commerce be debated during this fall's special session of Parliament. The government panel said it would complete its proposal of specific measures to promote the Internet in Japan within two months.