The Central Industrial Development Scheme for Jammu and Kashmir (J&K IDS 2021) recently announced by the Lt Governor Manoj Kumar Sinha has been welcomed by all the people associated with the industrial sector.
The scheme, which was approved by the PM Modi-led Cabinet Committee for Economic Affairs with an outlay of Rs 28,000 crore for a span of 16 years from 2020-21 to 2036-37, is aimed to boost industrialisation in Jammu and Kashmir, bring outside investment and provide employment for about a half a million people over the time.
While announcing the scheme, the Lt Governor said it will give a boost to local manufacturing, help the J&K industries to compete with national level and make Jammu and Kashmir ‘Aatmnirbhar’— self-reliant.
The scheme, which will encompass both the manufacturing and service sectors, has a number of incentives to lure the investors for investing in otherwise, geographically disadvantaged, and landlocked place. It includes 30% or 50% capital investment incentive on both plant and machinery and construction of physical assets depending on the industrial zone a person or a company is investing in.
Similarly, the scheme provides capital interest subvention of 6% for seven years up to a loan amount of Rs 50 crore, besides GST and working capital incentive. The scheme also promises to take the industrialisation to block level in all the areas of the Union Territory. It has continued the zoning of all districts in A and B category as per the remoteness, industrial backwardness and other disadvantages.
However, the full document of the scheme is not yet in the public domain. Therefore, certain things regarding the scheme are in want of clarification. The question is whether J&K IDS 2021 is just a central scheme or will act as an industrial policy for the UT. Both the experts and industrialists believe that only land banks, incentives and subsidies are not going to revamp the industrial sector here. The main problem, which besides the geographical disadvantage, political uncertainty, and lack of inf, is the policy laggard.
J&K needs a robust industrial policy, which will have a primary focus on basic infrastructures like roads, power, internet and other facilities. J&K figures among the bottom five in states and union territories of the country in ease of doing business. There is a lot of hassle in establishing an industrial unit. Similarly, despite many promises, there is no single window system. Even in industrial zones, environment, electricity and other clearances take months of visiting one office or other. As almost all the industrialist bodies from the Kashmir division want the government to have relook on the zoning given the disadvantage of the Kashmir division and some districts of Jammu division to compete with the industrially advanced districts also needs to be given a compassionate thought.
The need of the time is that alongside all these incentives announced by the government in the scheme there needs to be a well defined industrial policy with the main focus on ease of doing business.
