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Review negative list: Industry

THERE IS growing demand from the industries to review and re-arrange the ?negative list? of industries issued by the State Government in its Industrial Policy announced on June 13, 2004, as the list is the repetition of the one announced in the 1994 Industrial Policy by the then chief minister Digvijay Singh.

india Updated: Mar 27, 2006 14:29 IST

THERE IS growing demand from the industries to review and re-arrange the ‘negative list’ of industries issued by the State Government in its Industrial Policy announced on June 13, 2004, as the list is the repetition of the one announced in the 1994 Industrial Policy by the then chief minister Digvijay Singh.

The Digvijay Singh government in its Industrial Policy had announced a ‘negative list’ (banned list) in which it had discontinued government benefits like tax sops etc to more than 60 industries. The list included several traditional industries and daal mills, manufacturers of fishing net, distilled water, confectionary and woven sacks etc.

The government resorted to this step on the plea that these industries have reached saturation point and there is no need for further expansion and encouragement to these industries.

But 12 years down the lane, the industrialists argue that things have changed drastically with the advance of technology. Several small industries have become high-tech and needed government support in the initial years of its establishment till they can stand on their own.

Moreover, 12 years after, demand for several items included in the negative list has increased manifold, but production remained the same due to lack of government support. As the gap between demand and production is increasing by the year, the industries from the neighbouring states like Gujarat and Maharashtra are fulfilling it.

“It is time government reviewed the negative list and re-arranged it as much has changed during the last 12 years since the list was first announced”, said All India Manufacturers Organisation (AIMO) chairman Mahesh Mittal. By giving encouragement to these industries both the industries and the government will benefit, as the government will get more revenue, Mittal added.

Giving an example, Mittal said the demand for woven sack, which is used in packing of cement, fertilisers, food grain, chemicals, cattle-feed etc, has increased manifold since 1994.

There are 12 woven sack producing units in MP out of which six are in Pithampur. The total production of these 12 units are around 21,000 MT (metric tones) per year and the total requirement of the woven sack in the state is around 40,000 MT.

There is a growing gap between production and demand for woven sacks in the state, Mittal said. Currently, the gap is filled by the industries in the neighbouring states of Rajasthan, Gujarat, Maharashtra, UP and Chhattisgarh, causing loss of crores of rupees to the State exchequer.

If the woven sack industry is given support by the government by excluding it from the Negative List, more investors will invest in this industry apart from expanding the existing industries in the state, said Mittal who is also the Managing Director of Narmada Extrusion, one of the biggest woven sack manufacturing units in the State.

It is time the government reviewed the negative list and re-arranged it as much has changed during the last 12 years since the list was first announced

First Published: Mar 27, 2006 14:29 IST