Initial investments lying idle, promoters not availing sanctioned loans
Nishikant Khajuria
JAMMU, July 9: Owing to no decision on the enhancement of the outlay for incentive under National Central Sector Scheme (NCSS), uncertainty continues to loom large over the fate of investments worth thousands of crore rupees in Jammu and Kashmir.
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Despite repeated reminders for the last over one year, the Government of India has failed to take a call on enhancement of outlay under NCSS for allocation of incentives to around 600 Industrial units, whose case applications have been accorded final approval under the scheme and most of which have even made investments on infrastructure and machinery.
As allocation for incentives under the scheme to these industrial units falls short of estimated liability and Government of India fails to take a decision on enhancing the NCSS outlay from Rs 28,000 crores to Rs 75,000 crores, official sources told the Excelsior that promoters of such units have stopped further work on their projects.
While initial investment by these units is lying idle, the worried promoters are not accepting the principal amount of loans sanctioned by various banks and financial institutions in their favour for further work, sources added.
Pertinent to mention that in April 2021, the Government of India had announced the National Central Sector Scheme (NCSS) for encouraging industrial development in Jammu and Kashmir Union Territory. The NCSS provided for four major incentives to industrial and services sector and the total budget outlay for the scheme was kept at Rs 28,400 crores for establishment of industry and services sector for new as well as existing Industrial and service sector units. The scheme envisaged an investment of approximately Rs 10,000 crores for which commensurate amount of Rs 28,400 crores was provided. September 30, 2024 was the last date for accepting applications under the scheme.
However, the Department of Industries and Commerce, J&K Government, received an overwhelming response from the investors and the investment proposals under the NCSS were more than double the envisaged amount.
As on August 12, 2024, the total committed financial liability of the 915 registered units under NCSS was calculated at Rs 16,378 crore while the estimation of liability of 617 registration applications under process has been calculated at Rs 54,808 crore. This takes the total estimated liability under NCSS to Rs 71,186 crores, sources explained.
Keeping in view the huge gap between the allocation and demand, the Department of Industries and Commerce, J&K Government, requested the Department for Promotion of Industry and Internal Trade, Ministry of Commerce, Government of India for enhancement of the outlay for the NCSS to match up to Rs 75000 crore for Industrial development of J&K. Lt Governor Manoj Sinha had also taken up the matter with Union Home Minister Amit Shah for enhancing the outlay to match the investments.
However, no decision has yet been taken by the Union Cabinet on the request, thus worrying the investors who have already made huge investments in creating infrastructure for their industrial units in Jammu and Kashmir.
Therefore uncertainty looms large over the fate of over Rs 15000 crore investments by around 600 investors, including some prominent groups like ITC, Dabur, Haldiram, Bhilwara, Cyclone Beverages etc, sources explained.
When contacted, the officers in J&K Government said that there was no formal response by the Central Government on the request over the issue even as they were optimistic that the outlay for NCSS would be enhanced.
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