J&K L-G Announces Rs 28,400 Cr New Industrial Development Scheme
Jammu: In a major decision, the Centre has approved the new Industrial Developmental Scheme for Jammu and Kashmir to usher an era of socio-economic development in the region as also cater to the aspirations of the people.
While giving details of the scheme, Lt. Governor Manoj Sinha, in a press conference on Thursday, said the scheme was a major push to the economy of the region and will provide huge opportunities of employment to the people.
The main purpose of the scheme is to generate employment beyond government jobs in both manufacturing and service sectors which directly leads to the socio-economic development of the region.
“The scheme is being implemented with the vision that industry and service-led development of J&K needs to be given a fresh thrust with emphasis on job creation, skill development and sustainable development by attracting new investment and nurturing the existing ones. It will provide major support to local industry, besides creation of new business opportunities,” the Lt. Governor observed.
The scheme is approved with a total outlay of Rs 28,400 crore up to the year 2037.
The following incentives would be available under the scheme:
1. Capital Investment Incentive at the rate of 30 per cent in Zone A and 50 per cent in Zone B on investment made in Plant and Machinery (in manufacturing) or construction of building and other durable physical assets (in service sector) will be made available. Units with an investment up to Rs 50 crore will be eligible to avail this incentive. Maximum limit of incentive is Rs 5 crore and Rs 7.5 crore in Zone A and Zone B, respectively.
2. Capital Interest subvention: At the annual rate of 6 per cent for maximum seven years on loan amount up to Rs 500 crore for investment in plant and machinery (in manufacturing) or construction of building and all other durable physical assets (in service sector).
3. GST Linked Incentive: Financial incentive based on Gross GST. This will incentivise output up to 300 per cent of the eligible value of actual investment made in plant and machinery (in manufacturing) or construction in building and all other durable physical assets (in service sector) for 10 years. However, the amount of incentive in a financial year will not exceed one-tenth of the total eligible amount of incentive.
4. Working Capital Interest Incentive: All existing units at the annual rate of 5 per cent for maximum 5 years. Maximum limit of incentive is Rs one crore.
Key Features of the Scheme:
1. Scheme is made attractive for both smaller and larger units. Smaller units with an investment in plant and machinery up to Rs 50 crore will get a capital incentive up to Rs 7.5 crore and get capital interest subvention at the rate of 6 per cent for maximum 7 years.
2. The scheme aims to take industrial development to the block level in UT of J&K, which is the first time in any Industrial Incentive Scheme of the Government of India and attempts for a more sustained and balanced industrial growth in the entire UT. Remote areas of J&K will see a major impetus through the scheme.
3. Scheme has been simplified on the lines of ease of doing business by bringing one major incentive — GST Linked Incentive — that will ensure less compliance burden without compromising on transparency.
4. Scheme envisages a greater role of the UT of J&K in registration and implementation of the scheme while having proper checks and balances by having an independent audit agency before the claims are approved.
5. Earlier schemes though offered a plethora of incentives. However, the overall financial outflow was much lesser than the new scheme. Whereas, the earlier schemes have provided about Rs 1,120 crores in all these years, this scheme shall provide an outlay of Rs 28,400 crores.
Major Impact and employment generation potential:
1.Scheme is to bring about radical transformation in the existing industrial ecosystem of J&K with emphasis on job creation, skill development and sustainable development by attracting new investment and nurturing the existing ones, thereby enabling J&K to compete nationally with other leading industrially developed States/UTs of the country.
2. It is anticipated that the proposed scheme is likely to attract unprecedented investment and give direct and indirect employment to about 4.5 lakh persons. Additionally, because of the working capital interest subvention, the scheme is likely to give indirect support to about 35,000 persons.
New Industrial Development Scheme for J&K will give a boost to domestic manufacturing in the region and help J&K in becoming Aatmanirbhar. The scheme will encourage new investment, substantial expansion and also nurture the existing industries in J&K, the Lt. Governor maintained.
The Lt. Governor, while giving out the details of the scheme, emphasized that it will ensure that the implementation of the new scheme shall be done in a manner which is friendly and hassle free to the investors. It will be ensured that entrepreneurs from within J&K and outside find a smooth and progressive ecosystem for their business plans, he added.
Further, the Lt. Governor said, “With our transparent policies, investments in developing infrastructure, market oriented policy environment and skilled human capital, we aspire to become a growth pillar for India in the current decade.”
He further said the government and industry will work closely to achieve the vision of the holistic and balanced development of Jammu and Kashmir.