Red tape tacklers

Published on Jan 29, 2006 12:50 AM IST

LOBBYING is no longer a dirty word in UP?s industrial circles. In fact, the trade and industry associations in the country?s most populous State have been increasingly measuring success through their ability to get the best out of an indifferent bureaucracy. This has become commonplace ever since the Samajwadi Party-led Government came to power in August 2003.

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None | BySantosh Chowdhury

They help move your files...faster

Yup! That’s the new ‘job profile’ of trade and industry associations. But what do they stand to gain? New memberships, which help them to generate revenue for the organisation.

LOBBYING is no longer a dirty word in UP’s industrial circles. In fact, the trade and industry associations in the country’s most populous State have been increasingly measuring success through their ability to get the best out of an indifferent bureaucracy. This has become commonplace ever since the Samajwadi Party-led Government came to power in August 2003.

The political will to attract big ticket industrial investment to the State notwithstanding, the overall outcome of bureaucratic hurdles had brought this belief in the State’s industry circles that the harder a trade or industry association in the State lobbied and got crucial trade and industry-related files moving in the secretariat, it would attract new memberships of harried traders and industrialists. Many entrepreneurs believe that they never even got a chance to get problems even heard in the secretariat in the past two-and-half-years without the help of  an industry association taking up their case with senior government officials.

So is it really a challenging task for the trade and industry bodies to get problems of traders and industrialists redressed at the UP Secretariat? It’s time to find out.

Ever since the Samajwadi Party-led government came to power in August 2003 in Uttar Pradesh, there had been a virtual scramble among the State’s industry bodies to get the government pay undivided attention to the worsening law and order situation in the State. The concerns on extortion and attack on industrialists flew thick and fast through letters shot to the principal secretary (Home) from the PHD Chamber of Commerce and Industry (PHDCCI) and the Indian Industries Association (IIA) since the beginning of 2004, when incidents of attacks on industrialists and extortion cases were at their peak.

The government responded by assuring that all District Magistrates (DMs) across the State would accord top priority to security of industrialists but nothing changed for the industry. Extortions in the name of some or the other politician “demanding party fund” continued unabated. Highly distressed over the rising attacks on industrialists and extortion cases in Moradabad, Agra, Noida and Muzzafarnagar belt, the PHDCCI recommended to the government last year to form a separate ‘Industrial Security Force’, which failed to find favour with the government and was never taken up for discussion at any level be it the bureaucracy or the State cabinet meetings.

However, the government on a plea made by IIA on similar concerns of rising attacks on industrialists, made the licensing procedure speedier for acquiring a gun for their personal security.

“It’s been a mixed bag of ‘Yes’ and ‘No’ from the government on a wide set of recommendations made by the PHDCCI in the past two-and-a-half years. The PHDCCI’s constant demand for labour reforms is yet to be accepted by the government, especially on starting a ‘contractual labour’ system for many Agri and Exports–related businesses where the work the business activity is seasonal in nature” former PHDCCI UP resident director Sanjeev Chaturvedi, who spent a major part of his tenure with PHDCCI, running to the secretariat for redressal of industry problems, commented. “It’s not that the government is completely immune to accepting recommendations of the trade and industry bodies. A lot of recommendations on infrastructure development, power and State-level taxes made by PHDCCI have been accepted by the government”, he said.

The Confederation of Indian Industry (CII), UP has its recommendations made for every new policy the State Government sets out to prepare. The major policies which have been announced by the State Government in the past one-and-a –half years had been Agri Policy, IT Policy, Tourism Policy, Sugar Policy and the Food Processing Policy.

The CII UP State had been helping the State Government prepare all the major industrial policies in the State. However, these policies need to be backed by the issuance of government orders (GO) for implementation, which had not actually happened. For instance, the State Government could not convince big corporate houses to move out of Noida and Great Noida and set up large industrial units in other parts of the State. “We believe that all our recommendations have been well accepted by the government ever since the
Samajwadi Party-led government came to power in Uttar Pradesh” commented CII UP Head Puneeta Priyadarshi.

However, there have been exceptions. Despite repeated reminders by the CII to implement the Agricultural Produce Marketing Committee (APMC) Act, the government had been sitting on the files for months.

The CII did not actually make any recommendation for implementing the APMC Act but kept reminding the Government for the larger good of the industry that the APMC Act should be implemented at the earliest to open the floodgates of investment opportunity in the Agri business in Uttar Pradesh. The proposal to form the Lucknow Industrial Development Authority (LIDA) is one of the major CII proposal under implementation but its progress report has seldom been made public, apart from some land acquisitions and a survey report made for the project.

There have been recommendations made by CII last year, which have not been accepted. A major recommendation was to charge ‘entry tax’ for all goods from those States, which have not announced entry tax exemption for goods arriving from Uttar Pradesh. The CII and other industry bodies still continue to fight for imposition of Value Added Tax (VAT) system in the State for the past two years which have been turned down by the government repeatedly on pressure from traders across the State.

“They (Government) don’t reject proposals made by us on various policy issues. The fact remains that if a recommendation is accepted and not implemented, it is tantamount to being rejected” commented Associated Chamber of Commerce and Industry (ASOCHAM) UP secretary general S B Agarwal.

“The fact remains that barely 10 per cent of the recommendations made by the industry is ‘accepted’ by the government and the rest 90 per cent remain unreplied or unimplemented”, he said. “None of our recommendations made on Trade Tax and Housing Policy issues have been implemnted by the state government in the past two-and-a-half years,” Agarwal said.

As regards Udyog Bandhu, unless senior officials holding office there have power to take decisions, none of the industry problems can be redressed at the government level, he added.


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