Despite attractive fiscal incentive under the State’s Industrial Policy (1998-2003), the rate of growth of industrial sector could not be accelerated primarily on account of the disturbed conditions in the State. Competition from cheaper imported products, coming into the country as a result of the policy of globalization and economic liberalization pursued by the Government of India, has also forced many local SSI units to down their shutters. With the problem of unemployment, particularly of the educated, being high, the Industrial Policy 2004 has been evolved keeping in view the experience gained in the last five years and some new positive elements that have entered the scene.
Industrial Policy 2004 will remain in operation from 1st February, 2004 until 31-03-2015.
Objectives - Industrial Policy 2004
The primary objectives of the Industrial Policy 2004 are :
To achieve sustainable industrial development in all regions for increasing the rate of growth, value of output, employment, income and overall economic development of the State;
To strive towards balanced economic and social development in all regions of the State by promoting industrialization particularly of the industrially backwards areas;
To encourage and sustain the cottage and tiny industrial sector with low investment, is able to provide employment to a large number of people in the state.
To create a supportive environment with transparency and easy access in information technology and financial resources.
To revive potentially viable sick industrial units so as to put to optimum use the capital and other resources already employed in such enterprises.
To promote the growth of thrust and export-oriented industries and encourage high-tech and knowledgeable based industries including information technology.
To take necessary steps in the field of Human Resources Development to make available skilled / technical manpower as per the needs of industry.
Approach & Strategy - Industrial Policy 2004
The strategy for achieving the objectives, and the main elements, of the Industrial Policy 2004 are:
Providing improved infrastructure and support services, with emphasis on regular and uninterrupted power supply.
Attractive incentives of the Government of India and of the state government.
Single window clearance system for power, pollution control, land allotment and registration of industrial unit.
Closer interaction with financial Institution and commercial banks, to ensure regular and adequate flow of finances to the industrial sector.
Rehabilitation of potentially viable sick industrial units.
Improving competitiveness of existing industrial units by facilitating modernisation aimed at enhancing productivity, energy efficiency and better environment management.
Enabling manufacturers of quality consistent products to augment their sales within and outside the state by brand promotion.
Reorienting Industries and Commerce Department.
Export promotional measures to augment export of products of the state outside the country.
Permanent Grievance Redressal System to remove bottlenecks in import and export of products to and fro the state.
Environment protection, to conform to state, national and global regulations.
Entrepreneurship development in the state, to provide opportunities to educated unemployed.
Encouraging Research & Development.
Focusing on thrust areas with natural advantages in the state and facilitating large investments in prestigious projects.
Package of Incentive - Industrial Policy 2004
Construction of a Captive Tube-well : 75% subsidy allowed, for a prestigious unit in any of the thrust area, max. amt. of Rs. 22.50 lakhs, over CIS.
Modernisation of Existing Units : Subject to a limit of Rs. 30 lakhs.
Brand Promotion : Rs. 20 lakhs-1st Yr., Rs. 15 lakhs-2nd Yr., Rs. 10 lakhs-3rd Yr.
Pre-Investment Studies/Feasibility Reports : Rs. 2.00 lakhs for preparation of project report from approved consultants.
DG Sets : 100% subsidy on new DG Sets ranging from 10 KW to 100 KW.
Mini/Micro or Captive Power Units : No electricity duty/state excise till 25 Years.
Price / Purchase Preference : Upto 15% on Government Purchase from SSIs.
Stamp Duty : Mortgage deeds in f/o Fls. exempted from the payment of stamp duty.
Exemption of Court Fee : For registration of documents relating to lease of land.
Toll Taxes : No additional toll tax on the raw materials, fuels consumable and finished goods.
VAT : Small, medium & large scale industrial units shall be provided relief under VAT till March 2010.
Central Sales Tax : Exempted on sale of finished goods outside the state.
Interest Subsidy : 3% subsidy shall be payable on the working capital facilities.
Testing Equipment : 100% Capital subsidy, max amt. of Rs. 25 lakhs.
Air Freight Subsidy : On finish goods and raw materials for any destination @ 50% subject to a maximum of Rs. 5 lakhs per year per unit.
Pollution Control Equipment : 30% subsidy, max. amt. of Rs. 20 lakhs.
Interest Subsidy for Technocrats : 5% interest subsidy on term loan.
Research and Development (R&D) : 50% subsidy, max. amt. of Rs. 5 lakhs.
Upto Rs. 4.00 Crores subsidy on Agro-based Projects under mini mission-IV.
Human Resource Development : Max. of Rs. 5 lakhs for male & Rs. 7.5 lakhs for women trainees on programs for skill development leading to employment.
Transport Subsidy : This is Govt. of India scheme and shall continue as such.
Difficult Area Subsidy : Govt. of India scheme for grant upto Rs. 75.00 lakhs @ 33.33% for Food Processing Projects