NEWS FROM STATES


Gujarat announces Industrial Policy 2000

The Gujarat Government in its industrial policy 2000 has announced a comprehensive package to provide a boost to the small scale sector.   Special attention has been paid to the development of small scale industries in the state by giving the following incentives :

  • To provide interest subsidy @ 5% per annum for 5 years upto maximum Rs. 25 lakhs.
  • Self financed units to be offered subsidy @ 10% of fixed capital investment upto maximum Rs. 10.00 lakhs.
  • Financial assistance upto Rs. 5.00 crore for facilities for cluster of industrial sectors.
  • 50% of expenditure for obtaining quality certificate with maximum limit of Rs. 2 lakh.
The thrust of the industrial policy would be on preparing the industry in the state to face global competition in the changed economic scenario.  Stress has been laid upon the development of infrastructure by announcing many progressive measures to attract private investment :
  • An asset management fund covering Debit and Equity Fund set up in GIIC.
  • Priority to IT, Telecommunication, Pharma, Bio-technology, shipping and marine technology.
  • Cash subsidies to industrial parks/high tech parks/ trade centres generating minimum specific employment opportunities.
Other salient features of the policy are :
  • Government to provide assistance to medium and large industries upto 25% of the infrastructure expenses incurred upto a maximum of Rs. 2.5 crore.
  • Interest subsidy @ 5% for the first 5 years upto a maximum of Rs. 5 lakhs to educated unemployed youths for establishing themselves in service industry.
  • Industrial units set up in backward districts offered additional incentives @ 25% under all the schemes.
  • Cash subsidy upto 25% of project cost to develop common effluent treatment plants etc.
  • Air Cargo complex at Ahmedabad to be strengthened and new complexes opened.
  • Plan to spend 1% of state budget every year on IT related activities to be progressively raised to 3% by 2005 AD. 
 
Madhya Pradesh gets World Bank Funds for rural development project

The World Bank and the Ministry of Finance in New Delhi on 05.12.2000 signed a $ 110.1 million project for the rural poor in Madhya Pradesh.

The programme, to be known as the Madhya Pradesh District Poverty Initiatives Project, is part of the new series of lending operations of the World Bank that seeks to improve opportunities for the rural poor to meet priority social and economic needs.

The total cost of the project is $ 134.7 million to which the state government is contributing  
$ 9.30 million and the beneficiaries of the programme are expected to provide $ 15.3 million.

Under the project small-scale sub-projects would be financed through district based community investment funds.  These funds will help the poor in the aided districts to receive health and education facilities.

The World Bank will also finance purchase of teaching aids for educational programmes, and small-scale infrastructure projects like small scale irrigation and roads. 

Madhya Pradesh co-op societies bill approved

The Madhya Pradesh Assembly on 07.12.2000 passed the Co-operative Societies (amendment) bill. Tabling the Bill, state minister for co-operatives Shri Govind Singh said the co-operative societies and banks in the State had incurred losses to the tune of Rs. 500 crore because of non-recovery of the loans.

He said NABARD gives loan to the apex bank, which is transferred to the district co-operative banks and the banks have to pay the loan amount and the interest on it but due to its non-recovery from farmers, the banks are running in loss. 

Madhya Pradesh economic policy by December

In an attempt to improve the financial health and attract investment, the Madhya Pradesh government has decided to formulate a new economic policy.

This decision was taken because the industrial policy failed to make any significant impact on the economic growth, despite the huge potential.

The new policy, would impact aggressiveness towards the economic development and would also focus on agriculture, infrastructure and service sector.

Madhya Pradesh govt to stop free power supply

The MP government has decided to stop supplying power to free single-point connections of those people living in slums and those using it for irrigation pumps of 5 HP (horse power).  

However, people belonging to the scheduled castes, scheduled tribes and those living below poverty line will continue to benefit from the facility. 

The cabinet also approved the Madhya Pradesh Energy Assessment Compounding and Recovery Act, whose purpose is to prevent illegal use and theft of power and to develop an effective mechanism to achieve this.

Under the proposed act, provisions have been made to enter and search the premises of all electricity consumers and seize materials for evidence.   These powers will be vested with the Naib-Tehsildar of the revenue department, assistant sub-inspector of police and an electricity inspector of the energy department. 

 
Maharashtra plans to raise power capacity to 24,000 MW by 2007

The Maharashtra government which has been rapped by the World Bank for the slow pace of power sector reforms has prepared a “Power Sector Vision 2020” document with an emphasis on improvement in power distribution system.  The government proposes to increase the installed capacity to 24,000 mw by 2007, from the current 14,042 mw with an investment of a whopping 
Rs. 22,000 crore.

The vision document stresses the need for improvement in power distribution system as the transmission and distribution losses incurred by the loss-making MSEB, during April-July, 2000, have been reported at 31 per cent.

According to state energy department, as many as Rs. 7,000 crore would be required in transmission and distribution projects by 2007.   Furthermore, an investment of nearly Rs. 6,000 crore would be needed for quality supply of power in next three years.
Punjab Agro to set up 3 food parks

The Punjab Agro Industries Corporation (PAIC) is to set up three food parks in the State involving an investment of Rs. 60 crore.  Besides this, PAIC would set up four food and vegetables processing projects at a cost of Rs. 40 crore which would process 40,000 tonnes of vegetables and fruits.  The expert committee constituted under the Chairmanship of Dr. V.K. Alagh to study the impact of World Trade Organisation (WTO) on Punjab and Haryana agriculture and industry has stressed the need to involve all states at national level in every aspect of WTO.  It is of the  view that although the state had a primary role to play in the provision of inputs, loaning and ultimately procurement of food grains for the farmers the latter were unfortunately kept in the dark about the framing of policies and guidelines relating to the WTO regime. The need for diversification of crops from paddy and wheat to fruits, vegetables, flowers, agriforests and dairy was also felt.   The committee recommended the provision of green  box subsidies at state level under which money should be pumped for maintaining a green environment and solving the problems of salinity, alkalinity soil erosion, floods, water logging adjustment of cropping patterns.  

 
Pisciculture up in Punjab 

According to the scientists there is a big potential to raise fish production manifold in Punjab.  The rich water resources of the State in the form of rivers, canals, lakes, wetlands hold immense promise to develop intensive aquaculture.

Farmers and other entrepreneurs in the State are taking to fish farming in a big way. 10,000 hectare of land has come under fish farming compared to just 1,521 hectare about 14 years ago. 

Many progressive farmers of the state are partly shifting towards fish farming while several small farmers have taken village ponds on lease from the panchayats concerned and renovated these for the purpose of fish farming.

With the development of fish culture technology by scientists and its dissemination among the farming classes of the state the government has set up fish farmers development agencies (FFDA) in each district of Punjab.   It provides details on fish farming to interested farmers, including tips on technology, extension services, finance, inputs etc. in an integrated way.   Punjab Agriculture University (PAU) also set up a separate department of Fisheries in 1994 to develop region specific technologies with a view to promoting fish farming in the State.  Fish production has increased to 4,100 kg per hectare a year which is double the national fish production of 2105 kg. per hectare.  

 
Kerala seeks ADB funds for reforms in state PSUs.

The Kerala government is negotiating with Asian Development Bank (ADB) for supporting its reforms in a broad range of areas, including public resource management (PRM).

In the package, public enterprise reforms would play a significant role, including voluntary retirement schemes (VRS) for those who would be retrenched as a part of restructuring and investment in different state sectors.

The package would be similar to what ADB had offered to Gujarat and Madhya Pradesh.  ADB sources noted with satisfaction that financial pressure had led to state governments strengthening their public finances and budget management, besides privatising or divesting and restructuring the state owned enterprises (SOEs).  The latter will reduce the financial burden the SOEs impose on the state budget and economy, while allowing the private sector to take the lead in development of commercial activities.

In Gujarat, 23 out of 54 SOEs have been taken up under the programme.   Some will be fully privatised, while others will be either partially divested or restructured or merged or closed.  To mitigate the social impact of SOE reforms, Gujarat set up a State Renewal Fund in September  1996 to finance costs of labour  retrenchement and debt settlement for SOEs being restructured or closed.  

Kerala to issue Rs. 150 crore bonds in December 

In a bid to provide better infrastructure facilities for industries and to extend help to the traditional sector in the state, the Kerala government has decided to issue bonds worth Rs. 150 crore State Industries Minister, Ms. Susheela Gopalan said.

The government had last year raised  Rs. 180 crore through bonds, of which only Rs. 80 crores was disbursed.  The remaining Rs. 100 crore would also be used to improve the infrastructure facilities along with the Rs. 150 crore being mopped up.

 
UP invites private players to set up food parks

The Uttar Pradesh government has invited around 25 companies viz. Nestle and Monsanto to set up operations in its upcoming agro-industrial food parks with a total outlay of Rs. 140 crore.  The five food parks which would be set up in Lucknow, Allahabad, Saharanpur, Chola and Haldwani would promote exports of agricultural goods from the State.

The Uttar Pradesh State Industrial Development Corporation (UPSIDC) Ltd. has prepared a feasibility report for the venture.  The government hopes to get a grant Rs.12 crore from the Centre.

The areas have been identified because  they have an abundant supply of raw-material ranging from cereals to fruits and vegetables which are required to sustain any food park;  These cities are also ideal because of their proximity to wholesale markets.  These areas would be able to provide cold chain facilities which are an essential requirement for handling perishable goods.

The proposed agro-industrial parks would offer common facilities for supporting and sustaining growth within the complex by providing customised and industry specific infrastructure for the processing units thereby helping them in becoming competitive and self-reliant.

 
Orissa government to set up a corporation to facilitate infotech sector activity

The Orissa government proposes to form an information technology corporation to give a boost to the sector in the State.   The corporation would play the role of facilitator for IT activities in the State.

The corporation would take under its wing the Orissa State Electronic Development Corporation (OSEDC), IDCOL Software Ltd. and Orissa Computer Application Centre, the three state-owned undertakings involved in IT-related activities as “the merger of the three undertakings would help focus on IT activities”.  The government is preparing a new IT policy with a thrust on attracting industry but without offering any incentives.

The draft policy proposes to set up a single window nodal organisation for speedy  clearances of projects and a venture capital fund of Rs. 15 crore to start with. The Small Industries Development Bank of India (SIDBI) has committed Rs. 7.5 crore and the OSEDC has chipped in Rs. 2.5 crore for the venture capital fund. The draft policy aims at attracting atleast 2000 IT companies to the state in the next five years with a view to create job opportunities for about 10,000 software professionals. It has targeted achieving exports of Rs. 2,000 crore by 2005.

65 software units of the total 144 registered in the state have become operational, and the export earnings touched Rs. 91.23 crore last year. Major exporters from the state are IT giants Infosys Technology Ltd. and Satyam Computers. There about 4000 software professionals now engaged in the IT sector in Orissa.

Orissa, sixth among the states in respect of forex earning from software export, has registered a tremendous growth in the IT sector. The state earned Rs. 4.76 crore during 1997-98 in exports.   Software exports jumped to Rs. 53.97 crore the next year. Despite the setback due to the supercyclone software exports from the state touched Rs. 91.23 crore in 1999-2000.

The OSEDC is planning to set up an incubator with IT specific infrastructure at Bhubaneshwar. The state government has arranged Rs. 7 crore and asked the Centre for another Rs. 3.6 crore from the Critical Infrastructure Balance Scheme for development of optic fibre network, broadband connectivity, Internet connectivity and support services at the IT incubator.