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Industrialists wary of red tape

BUSINESSMEN LISTED red-tapism and lack of coordination among various government departments as dominant factors that have impeded the State?s industrial growth.

india Updated: May 29, 2006 20:05 IST

BUSINESSMEN LISTED red-tapism and lack of coordination among various government departments as dominant factors that have impeded the State’s industrial growth.

Industrialists submitted their recommendations, objections and suggestions for the proposed industrial policy after holding one-hour deliberations at the State-level symposium organised by State Commerce and Industries Department at Shri Govindram Sakseria Institute of Technology and Science here (SGSITS) today. The symposium focused on how to make the new industrial policy industry-friendly.

After deliberations, the compiled recommendations were submitted to the three-member sub-committee comprising State Industries Minister Babulal Gaur, Finance Minister Raghavji and Energy Minister Kailash Vijayvargiya, who were present.
The businessmen were given six topics to file suggestions. They divided themselves into six sub-groups for the purpose. Each sub-group made following suggestions.

Sub-Group on Labour Laws:  It suggested that industrial policy be directed towards employment-generation and productivity enhancement. A tripartite meeting of industrialists, government and labour unions be held to decide labour policy. Concept of employer and employee needed to be redefined. Labour laws needed to be made more flexible.

Under the Contract Labour Act, it should be ensured that employees put in eight hours of work. This Act should extend its jurisdiction.

Labour Department should be involved in BIFR cases. Medical facilities at ESIC hospitals need improvement. Sub-Group on Implementation Issues:  Policy and regulations should be implemented within given timeframe, as they get redundant by the time they reach execution level. Ensure accountability from government and industrialists for time bound growth.

Mutual trust, constant updating, regular monitoring, timely policy notifications and standard interpretation of policy to avoid confusion. Avoid frequent change in taxation policy. Industrialists should be considered as stakeholders.

Sub-Group on Sick Industry: Aggressive scheme for revival of sick units. Productive use of resources and entrepreneurship. Dues should be recovered in 36 installments. Exemption in stamp duty and registration fee to purchaser of sick industrial property.

Exemption from surcharge, interest, dues demanded by MPSEB and AKVN. Unused power equipment like sub-stations should be taken back by MPSEB.

Sub-Group on Energy: Review of MP Electricity Regulatory Commission tariff plan. Include judicial member in Commission. Uninterrupted power supply, duty-free captive power for textile industry. Minimum charges for non-operational period. Electricity duty rate should not depend on power tariff and should not exceed 10 paise per unit. Power tariff for export-oriented unit, which is Rs 4 per unit, should be at par with SEZ tariff that is Rs 2.85 per unit since both promote exports.

Revenue and forest land acquisition to be speeded up for setting up power plants. Areas should be identified for development of non-conventional energy sources. Betul, Amarkantak and Barwani are ideal for wind energy development.
Sub-Group (miscellaneous): Industrial Facilitation Act should be immediately enforced. Effective implementation of Store Purchase Rules.

Form separate directorate for small and medium industry for better tax recovery and productivity enhancement. MP Pollution Control Board should separate polluting and non-polluting units to avoid harassment to entrepreneur. Set up monitoring committee for effective disposal of hazardous waste. Fix target for employment generation. For example: Textile industry can generate direct five-lakh employment, so pay attention to it. Get rid of dacoits in Gwalior region to promote industry there.

Sub-Group on Concessions and Facilities: Property tax charged by civic bodies on industrial property is very high. It should be levied on the building and not on the open leasehold land. State Government should ask Central Government to decrease excise duty on pharmaceuticals from 16 per cent to 8 per cent, as it was hard to compete with Uttranachal and Himachal Pradesh that have been exempted from it.

Besides, Union Government should be asked to grant concession only to pharmaceutical producer and not also to those doing job in two states.

Abolition of one per cent entry tax on jewellery, cotton and pulses mills. Stamp duty and registration fee exemption on equitable mortgage. Despite exemption granted on stamp duty and registration fee on transfer of land/building to blood relations in industrial areas, Registrar refuses to acknowledge it on the ground that he has no such instructions from Commercial Tax Department.

‘Value addition exercise’
STATE INDUSTRIES Commissioner M Gopal Reddy told Hindustan Times – “We are not making a new industrial policy. We are revising industrial promotion policy 2004, which is a value addition exercise. I would call it investment promotion and growth policy instead of an industrial policy.”