Industrial package

The Department of Industrial Policy and Promotion (DIPP) has put weight behind extension of industrial package to the State of Jammu and Kashmir for another five years. The life of the previous package, which had been sanctioned for ten years, expired in June 2012. The State Government had approached the Union Ministry of Commerce and Industry to extend the package for ten more years keeping in mind the need of strengthening industrial health of the State in the background of two decade-long turmoil and also its geographical and climatic conditions. There have been several rounds of discussions on the entire gamut of industrial packages to the state and now the DIPP has desired the State Government to submit its report on thrust industries. Obviously the State Department of Industries will submit the desired information within the stipulated period of 15 days so that it is incorporated in the note for the meeting of the Cabinet Committee on Economic Affairs.
The industrial package is not exclusive to J&K State. Other States, too, have been provided such packages based on the needs and requirements of each State. Since needs differ widely from state to state, industrial packages cannot be uniform. Thus each state is to be handled on the basis of its requirements. In the case of our state, the DIPP has already conceded that J&K has need for special package. But there are certain issues involved and the DIPP has not been able to accede to all that the J&K demanded. The question of ‘location’ of new industries is of much relevance to the extension of package to the State. The State Government feels uneasy with the location specific package. This has been explained by the State Department of Industries and Commerce in its comprehensive note sent to the DIPP. It had said.” As per the land laws applicable in J&K, non State Subjects cannot purchase or get private lease of land and all the outside entrepreneurs are accommodated in the organized industrial estates only. Since the Government of India package is applicable only in identified locations, neither the benefit of this package could be fully availed by the entrepreneurs of the State nor could the industry disburse in the hilly and backward areas of the State. So the package should be made location neutral as had been done in the States of North East, Himachal Pradesh and Uttrakhand in order to provide benefits of incentives to the units outside the industrial estates”. The location neutrality in the case of J&K is a debatable issue and should be understood in the light of ground situation. Identification of locating an industry is more or less a technical and not political issue. A number of physical factors dominate the entire dialogue in this context. Setting up of an industry must fulfill a criterion set up by the policy planners. As such, identification is something in which the policy planners, experts and the representatives of the State Government are involved. They have to join heads and come to some consensual decision. Obviously this practice has been followed in our State and thus previous ten year package was sanctioned.
There is definitely a cogent point in the argument of the State Government that owing to strict adherence to the location formula of industries, the vast hilly region of the state and the people inhabiting it remain deprived of the benefits of industrialization. After all, what is the ultimate purpose of bringing in industries? It is to provide better life standard to the masses of people. By binding the industries to defined locations and segregation will not help in mitigating economic deprivation of the people of hilly areas. The solution does not lie in confining the new industries to the identified locations only, but to find the viability of bringing suitable industries and industrial culture to more backward areas of the state especially in its hilly regions. In that sense, the demand of the State Department of Industries is valid and needs to be given proper hearing.
We are also unhappy that the DIPP has not accepted the request of extending package by 10 years. It must be kept in mind that encouraging self-employment and private enterprise also means to extend patronage to the industries.


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