Nishikant Khajuria
JAMMU, May 7: Sending out very discouraging signals to industries and entrepreneurs of Jammu and Kashmir, the Central Government has allocated a meager amount of funds to the State for incentive schemes for the current financial year.
For example, against a projected requirement of Rs 1,135 crore under the Transport Subsidy Scheme for the special category States, including Jammu and Kashmir, only Rs 70 crores have been allocated for the year 2016-17 while under Special Package for J&K, Himachal Pradesh and Uttarakhand, only Rs 25 crores have been allotted.
This deficit is glaring and much more serious in view of the fact that these schemes are specifically being implemented to bring industrialization in the remote, hilly and inaccessible areas by providing support to the industrial units so that they could withstand competition with other similar industries, which are geographically located in better areas.
Even the Department Related Parliamentary Standing Committee on Commerce has expressed its distress over the same in its report on Demands for Grants of the Department of Industrial Policy and Promotion, Ministry of Commerce and Industry, for the year 2016-17.
“Such meager allocation under the schemes is as good as no funds rendering the scheme non-functional,” the committee has observed in its report.
The Transport Subsidy Scheme was introduced around 45 years back to develop industrialization in the remote, hilly and inaccessible areas by providing for subsidy in the transportation cost incurred by the industrial units so that they could withstand competition with other similar industries. With effect from 22-01-2013, it has been modified and notified as Freight Subsidy Scheme-2013.
In J&K, the scheme provides a subsidy of 90 percent on the transport cost for transportation of raw material and finished goods to and fro from the location of the unit and designated rail-head. Jammu and Kashmir Development Finance Corporation Limited (JKDFC) is the nodal agency for disbursement of subsidy to the industrial units here.
According to the official sources, the projected requirement under the scheme was Rs 1,135 crores and the Department of Industrial Policy and Promotion (DIPP) had sought an allocation of Rs 893.15 crores for the transport policy at Budget Estimate 2016-17. However, sources added, due to overall reduction in the budget allocation, the Department was constrained to limit the allocation for transport subsidy to Rs 70 crore. The Parliamentary Standing Committee, headed by Chandan Mitra, has asked the Department of Industrial Policy and Promotion to take up the matter with the Ministry of Finance about the importance of the scheme in ensuring the level playing field for industries of special category States and ensure that adequate funds are allocated to the scheme, sources said.
Further, observing that the Government was seemingly not serious about the poor response to its Freight Subsidy Scheme, the Parliamentary Committee has asked the DIPP to plug the loopholes of the existing scheme and incorporate the needed changes to make the scheme attractive and true to its purpose, sources said.
Non-seriousness of the Governments, at Centre as well as State levels, can be gauged from the fact that till December last year, then MD of the JKDFC had not convened even a single meeting of the Corporation despite repeated reminders for submission of projected requirement for the next financial year, sources said.
Further, the Parliamentary Standing Committee has also expressed its serious concern over low budgetary allocation of only Rs 25 crores under package for three special category States, which include J&K, Uttarakhand and Himachal Pradesh.
In Jammu and Kashmir, this Centrally sponsored scheme extends financial assistance towards Central Capital Investment Subsidy, Central Interest Subsidy and Central Comprehensive Insurance Scheme. JKDFC is the nodal agency for routing of incentives and subsidies provided under various schemes to the eligible industrial units in the State.
The Parliamentary Committee has expressed serious concern over the fact that upto December 2015, only an amount of Rs 293.39 crore was incurred against the approved outlay of Rs 734 crore of the 12th Five Year Plan “During the calendar year 2015, the proposals for an amount of Rs 131 crore had been sanctioned in the State Level Committee Meetings, held from time to time, but the Department has allotted only Rs 25 crores,” observes the Committee in its report.
Pointing out that employment generated in the State of Jammu and Kashmir has come down in comparison to the date of last year, the committee has asked the department to ascertain the reasons behind the drop and suggested that labour intensive industries should be promoted under the scheme.
The Committee has also asked the Department to persuade the Ministry of Finance to allocate the adequate amount of funds for the scheme and monitoring of implementation of the scheme regularly at higher level.
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