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| Industrial growth in Jammu and Kashmir- still a distant dream | | | Bashir Assad
JAMMU, Mar 2: Jammu and Kashmir state is yet to come out from the quagmire of industrial backwardness due to the fact that the industrial sector has not received much attention from the government not to speak of making it a priority sector for poverty elevation and employment generation..
The composite industrial policy presently in vogue in the state of Jammu and Kashmir was approved by PDP led coalition government on 23rd of January, 2004 . It was decided in the cabinet approval that no change would be made to the policy till 31st of March 2015 in the interest of giving stability to it. Before and after this industrial policy some 2500 crores were invested in the state in Industrial sector till 2008, however, with the partial withdrawal of Central Excise Exemption in 2008, the state industrial policy has suffered a huge setback and the industrial growth has almost come to grinding halt. The Economic Survey 2011-2012 presented in the state assembly on Thursday (March 1) has admitted that the state was still reeling under the quagmire of industrial backwardness. The primary, cause according to the industrialists, is the partial withdrawal of Central Excise Exemption Package in 2008, and abandoning the industrial policy 2004 or modifying it.
"During the previous coalition regime, some serious multidirectional efforts were made to revive the sick and non-functional units on one hand and on the other hand attractive incentives were given to medium and large industries including 100% subsidy on purchase of new Diesel Generating sets, 100% subsidy on project report and quality testing equipment, 75% subsidy on Research and development, special incentives for brand promotion and modernization, land and power on concessional rates under state package while under central package 15% subsidy on capital investment on plant and machinery, 3% subsidy on working capital , 100% insurance cover to industrial units and 90% transport subsidy. However, what was even more attractive was the 100% excise exemption and 100% income tax exemption but due to partial withdrawal of the excise exemption, industrial growth has come to a grinding halt' said Tejwant Singh Reen, President Gangyal Industries Association.
The primary objectives of the Industrial Policy 2004 was to achieve sustainable industrial development in all regions for increasing the rate of growth, value of output, employment, income and overall economic development of the State; to strive towards balanced economic and social development in all regions of the State by promoting industrialization particularly of the industrially backwards areas; to encourage and sustain the cottage and tiny industrial sector which, with law investment, is able to provide employment to a large number of people in the state; to create a supportive environment with transparency and easy access in information, technology and financial resources; to revive potentially viable sick industrial units so as to put to optimum use the capital and other resources already employed in such enterprises; to promote the growth of thrust and export-oriented industries and encourage high-tech and knowledgeable based industries including information technology; to take necessary steps in the field of Human Resources Development to make available skilled/technical manpower as per the needs of industry.
Although, with all its lacunas ( especially the one that outside investors took full advantage of the policy) , the policy was moving in the right direction till 2008, however, due to inaptitude of the state industries department, it has failed to achieve any of the above objectives and instead has been instrumental to bread inequalities to opportunities and imbalanced industrial development in the state.
Moreover, the department of industries and commerce in the state, in gross violation of the provisions of the policy, has unilaterally increased the rates for premium and rent of land during the currency of the policy.
Where as Prime Minister's Task Force on MSMEs has recommended several recommendations on various issues confronting MSME growth in the state in order to enhance the J&K package and bring it at par with the modified NEIIPP of NER for MSMEs and has been approved by the Prime Minister. Whereas orders for some of the approved provisions have been issued by the respective central government departments, orders for some other provisions are awaited. The location bar and other riders have also been recommended to be removed from the central package.
According to informed sources the union finance ministry has issued orders regarding grant of extension in the Excise/ Income Tax exemption (which was due to expire on March 31, 2012) for a further period of 10 years till 2020 but the state government has not so for received any intimation nor does it make any effort to confirm it.
On the other hand, the Prime Minister's Expert Group on Job Plans under the chairmanship of Dr. C. Rangarajan has also recommended some sectoral initiatives for the development of enterprises in the state but there is no pursuel from the state government to get these valuable recommendations implemented on ground.
Despite the promises made in the industrial policy, 2004 regarding development of modern industrial areas and estates, growth centres , Integrated Infrastructure Development Centres (IID) etc. in a time bound manner, no substantial addition has been made to such infrastructure already under acquisition except that the Economic Survey 2011-12 has underlined the future programs for establishing new industrial estates at Khunmoh (Phase III), Ompora in Budgam, Chotipora in Kupwara, Ashmuji in Kulgam, Veesu in Anantnag, Govindser (phaseII) Ghatti in Kathua and Industrial Growth centre phase-III in district Samba.
However, the entrepreneurship development cannot be visualized without the requisite infrastructure in place. |
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