Neeraj Rohmetra
Jammu, Mar 17: Union Ministry of Commerce and Industry is likely to give its consent for extension of package worth nearly Rs 296 crores to the industrial units of the State by the end of this month.
Reliable sources told EXCELSIOR that the decision for extension of the industrial incentives became possible after the personal intervention of the office of Chief Minister and persistent follow-up by top brass of the Industries Department.
“There had been several round of talks between the officials of the Union Commerce Ministry and Industries Department of the State and the former has agreed in principle for extension of the industrial package”, sources said adding, “interestingly, the package of industrial incentives is being extended only to the entrepreneurs of the border State and is unlikely to be extended to other States, who were enjoying similar incentives earlier”.
Sources asserted that the Union Government had given consent for Rs 296 crore package and the incentives are likely to be extended for another five years.
Sources said astonishingly, during the last 10 years, the State had received around Rs 110 crore as part of incentives for the industrialists of the State. “It was only during the last financial year (2011-12) that he State had received around Rs 60 crores and therefore the officials of the Industries Department made all projections before the Union Commerce Ministry based on this data”.
“Recently, they had sought details about the thrust industries from the Industries and Commerce Department of the State Government so that the information could be incorporated in the Cabinet memorandum to be submitted to the Cabinet Committee on Economic Affairs (CCEA) in this regard”, sources added.
The State Industries Department completed the entire exercise within the stipulated time and has submitted all the necessary details. “The Department has elaborated on all the areas, which are of immense importance to the industrialist of the State. While in the earlier proposals, details had been given about 16 times, five new items have been submitted to the fresh proposal. “, sources said.
Source further added, “among other points, the State Government has insisted on covering others like those associated with the service industries including Information Technology (IT); Handicraft industry and few others”.
“In most of the other areas pertaining to the industrial incentives, there was complete unanimity among the officials of Union Ministry and their counterparts here.
The fresh industrial package would be given effect from June 14, 2012 when the earlier package of incentives sanctioned for 10 years in 2002 had expired, sources said while disclosing that the Department of Industrial Policy and Promotion has rejected the demand of Jammu and Kashmir Government to extend the package for another 10 years and bring the industrial units outside the industrial estates under the ambit of the fresh package.
While seeking location neutrality under the new industrial package, the State Government in a detailed representation to the Department of Industrial Policy and Promotion has stated, “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 Uttarakhand in order to provide benefits of incentives to the units outside the industrial estates”.
Though location neutral demand has been out-rightly rejected by the Department of Industrial Policy and Promotion, it has, however, given an indication that industrial units in clusters outside the industrial estates and thrust industries could be considered for extension of benefit of incentives.
It is worthwhile to mention here that the Special Package Scheme given by the Ministry of Commerce and Industry included Central Capital Investment Subsidy Scheme, Central Interest Subsidy Scheme and Central Comprehensive Insurance Scheme. The Government of India package announced in 2002 was supplemented by the State Government under the State Industrial Policy, 2004.
Additional incentives are available to the industrial units in addition to the Government of India package like subsidy on diesel generating set, subsidy on quality testing equipment, subsidy on pollution control devises or some exemptions like Toll Tax exemption on inward and outward raw material/finished goods in the State and exemption from payment of VAT.
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