Srinagar, Oct 12: The government has authorised two senior functionaries to hold consultations with industrial stakeholders and examine the policies of other states, particularly neighbouring ones, before finalising the proposed Industrial Policy, as it seeks to boost investment and employment within the J&K’s limited financial resources.
The draft policy will be submitted to the Finance Department for detailed examination of the incentives that can be offered to industries, with the government keen to introduce the framework at the earliest.
The exercise comes as industrial associations have repeatedly sought a new policy to support existing units, encourage fresh investment and address the difficulties faced by local entrepreneurs.
Official sources said the government would take stakeholders into confidence before releasing the draft, while also examining the industrial incentive structures adopted by other states to identify measures that could be incorporated into J&K’s policy.
The Finance Department’s assessment is expected to be crucial in determining the final shape of the incentives, as the government will have to work within the resources available to J&K.
Officials have indicated that J&K may not be in a position to match the incentives offered by financially stronger states such as Punjab but would seek to provide whatever support is possible within its financial capacity.
Chief Minister Omar Abdullah, who also holds the Finance portfolio, recently reviewed preparations for the Industrial Policy with senior officers of the administration.
The government is seeking to ensure that the policy benefits existing industrial units while creating conditions for new entrepreneurs to establish businesses in J&K.
Employment generation is expected to be a key consideration in framing the policy, alongside the need to sustain existing enterprises and attract fresh investment.
The policy consultations assume significance as industrial bodies have been pressing for a comprehensive framework that addresses not only incentives for new units but also the operational and financial difficulties confronting existing industries.
The Federation of Chambers of Industries Kashmir (FCIK) has sought a comprehensive industrial policy covering new, existing, expanding and revived units.
It has also called for measures to rehabilitate stressed micro, small and medium enterprises, improve access to institutional credit and reduce the financial burden on units struggling with accumulated liabilities.
Among its demands are relief on accumulated interest, surcharges and penal charges on electricity dues, along with a structured mechanism for recovering actual consumption charges.
The federation has also sought a one-time settlement mechanism for eligible stressed borrowers and reforms to improve the ease of doing business.
The Kashmir Chamber of Commerce and Industry (KCCI) has sought a substantial expansion of the incentive framework under the New Central Sector Scheme, along with wider coverage for existing and expanding units and greater opportunities for local entrepreneurs.
The chamber has also called for simplified approvals, better infrastructure in industrial estates, stronger market access for local manufacturers, and support for technology upgradation.
Industry associations have maintained that a policy focused only on attracting fresh investment would not adequately address the challenges faced by enterprises already operating in J&K.
The demands come against the backdrop of the Centre’s New Central Sector Scheme (NCSS), launched on April 1, 2021, with an outlay of Rs 28,400 crore and a validity extending to 2037.
The J&K administration has sought an increase in the scheme’s incentive outlay to Rs 75,000 crore to accommodate more eligible industrial units, following a substantial response from investors.
According to figures cited in the scheme’s assessment, 971 industrial units have been approved in J&K.
Of these, 918 units were approved earlier, involving proposed investment of Rs 12,668 crore and projected employment of 48,995 persons.
Another 53 units were approved subsequently, involving proposed investment of Rs 1626 crore and projected employment of 2902 persons.
Together, the 971 units represent proposed investment of Rs 14,294 crore and projected employment of 51,897 persons.
The figures indicate investment commitments and expected employment rather than confirmed investment realised or jobs already created.
The proposed increase in the central scheme’s outlay is intended to create room for additional eligible units, although the number that can be accommodated will depend on the availability of funds and the assessment of pending cases.
The new Industrial Policy will have to address a broader range of issues, including the functioning of existing industrial estates, availability of utilities, access to credit, regulatory clearances and market opportunities for locally manufactured products.
Industrial associations have also called for stronger procurement preferences for local manufacturers, timely settlement of government dues and more transparent procedures for industrial land allotment. These measures, they argue, would help improve the competitiveness of local enterprises and encourage businesses to expand their operations.
The government’s consultations with stakeholders and examination of policies in other states are expected to help determine which proposals can be incorporagive ted into the draft.
The subsequent scrutiny by the Finance Department will establish the extent of financial support that can be provided.
