Slowdown, uncertainty over Himachal industrial package hits investment climate

Shmila:Uncertainty about extension of the industrial package beyond 2010 for Himachal coupled with down turn in global economy has put on hold much of the investments which the state has been banking upon to boost industrial growth.

Principal Secretary industry Subhash Negi said, “With liquidity constraints being eased by Reserve Bank of India and the finance ministry, planned investments are likely to pick up.”

Official figures put the total investments project proposal cleared by the state since the industrial package was announced in 2003 at Rs 32,480 crore which is projected to generate 3.94 lakh new jobs.

These figures apart, till end of August 2008, projects worth Rs 4125 crore stood commissioned which have translated into much lower figure of jobs having actually being created.

An official of the industry department disclosed, that new investment proposals had come down to a trickle,

Most proposals coming for scrutiny pertained more demand for land or electricity and some for expansion plans.

Slowdown in economic activity and with the industrial package ending in 2010, much of the investment in the pipeline is on hold, the official said.

Of the five cement plants cleared in the last few years only one is scheduled to be commissioned by 2009.

The proposed cement plants in Chamba district, Sundernagar, Alsindhi and Chopal still have a long way to go before they will be established. Each of these units involves an investment of about Rs 800 crores, he disclosed.

The state government has asked the center for restoring the industrial package to its original time-frame, says Negi. On this the states of Jammu & Kashmir and Uttrakhand are with us, he added.

Midway changes in policy has damaged the investment climate that the state was looking forward to,” says Rajinder Thakur, a Parwanoo based industrialist.

First the 10 year package announced by the AB Vajpayee government in 2003 was curtailed to 2007 then extended to 2010, which has left entrepreneurs speculating whether they would be able to commission their units within the stipulated timeframe so as to be eligible for availing the excise and income tax concessions permitted, said Thakur.

As Editor, Ravinder Makhaik leads a team of media professionals at Hill Post. Spanning a career of over two decades in mass communication, as a Documentary Filmmaker, TV journalist, Print Media journalist and with Online & Social Media, he brings with him a vast experience. He lives in Shimla.

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