Industry sector in Uttarakhand awaits ‘double engine’ push

As the Trivendra Singh Rawat government completes a year in office, all eyes are set on the key portfolios which the chief minister has kept with himself.

dehradun Updated: Mar 10, 2018 21:36 IST
Hindustan Times
More than 1,700 acre of land, earmarked for industrial use in Udham Singh Nagar’s Sitarganj, has found no takers. (HT Photo)

As the Trivendra Singh Rawat government completes a year in office, all eyes are set on the key portfolios which the chief minister has kept with himself.

Besides industries, Rawat took charge of important portfolios, including health, public works department, and intelligence department.

The last one year was sluggish as far as the industrial growth in the state is concerned. The sector is still struggling as no new substantial project has came in the state during the period amid buzz that many of the industrial units mulling to shift base from the state.

Industrial development started in Uttarakhand in 2003 with the announcement of a 10-year concessional package by the Centre. Though the central scheme for a tax-holiday to set up industrial units in the state lapsed in 2010, there have been demands that the tax sops for setting up units be continued.

Progress so far

The state has witnessed investment of more than ₹ 35,000 crore in the industrial sector since 2003 when the industrial estates were set up by the State Industrial and Infrastructure Development Corporation of Uttarakhand Limited (SIIDCUL) in Dehradun, Haridwar, Pantnagar, Rudrapur and Sitarganj.

The last year has not seen much activity on the industrial front and the investment figures have remained static.

There have been talks about Chinese companies willing to invest ₹300-400 crore in the textile sector in Uttarakhand. Apart from this, an LPG filling plant has been set up at Sitarganj and a company that manufactures helmets is also setting up a unit in Rudrapur.

Red tape to blame

More than 1,700 acre of land, earmarked for industrial use in Udham Singh Nagar’s Sitarganj, has found no takers. After developing Rudrapur as an industrial estate, the state government set up a similar one at Sitarganj.

As many as 146 industrialists set up units there, availing subsidies and tax exemptions provided by the Centre and the state government, officials familiar with the project said.

In 2014, the state government developed the phase-2 of the Sitarganj industrial estate on 1,700 acre of land. Inaugurating it, the then chief minister Vijay Bahuguna claimed that industries had shown interest in setting up units in the Sitarganj industrial estate phase-2.

Officials familiar with the project said Rs 325 crore was spent on developing infrastructure--roads, electrification and drainage system. Though, only 10 industrialists have bought 422 acre of land at the complex, they are yet to set up the units, the officials said.

Yogesh Jindal, chairman of the SPNG Spinning Mill in Kashipur, agreed that the industrial investment had become static in the state.

Though, the chief minister has shown willingness to enhance the growth of the industrial sector in the state but the bureaucracy has not shown the will power to execute projects and help entrepreneurs, Jindal said.

“The government may be rolling out the red carpet to welcome foreign investors, but nothing is being done for the local entrepreneurs.

“We wish that the chief minister revives the Udyog Bandhu system where there were meetings with the industry representative and brainstorming over ways to promote growth”.

A mega policy for textile was announced for the state in 2015 during the Congress regime but it has hardly helped the industry in terms of capital and modernization, said Jindal.

GST main culprit

Like other parts of the country, industry leaders in state said that the Goods and Services Tax (GST) had been a problem area rather than helping industrialists in the state.

Pankaj Gupta, president of the Industries Association of Uttarakhand, said no major change had come about in the industrial sector of Uttarakhand and the growth has in fact declined after the implementation of GST.

“No new policy has been announced by the present government due to which there is little activity on the industrial front,” he said.

Ease of doing business

The Business Reforms Action Plan, 2017 also known as “ease of doing business” report that is prepared on the basis of 340 points, has put Uttarakhand in 19th position, a step behind Uttar Pradesh in the list of 24 states.

It is not something that state can proud about. Although, state director of industries SC Nautiyal said the last one year has seen good growth in the industrial sector.

An upcoming technology institute in the constituency of the chief minister will be a game changer, he said.

“A Central institute of Plastic Engineering and Technology is being set up in Doiwala with the support of the Centre, which will give a boost to the industrial sector in Uttarakhand.

“This apart, a single window system of obtaining a number of clearances for setting up industries has also been strengthened by the government, leading to good interest among entrepreneurs and investors from other states.”

Mineral Sector: illegal quarrying unabated

The mineral sector in the state is also under pressure from the illegal quarrying lobby due to which the e-auctioning policy was announced in October 2017 in which bids will now be held through an e-system or online bidding.

This has been done to bring in more transparency in the bidding process.

The government has also set a target to raise revenue of ₹600 crore in the current fiscal from mining and quarrying activities in the state.

Deputy director mining (Kumaon) Rajpal Legha said the revenue target from mining and quarrying for the year was pegged at ₹600 crore, while revenue from quarrying and mining under the forest development corporation, was a separate.

A number of steps have been taken for ending illegal quarrying by inviting e-tenders and GPS tracking of vehicles, he said.

First Published: Mar 10, 2018 21:36 IST