Eyeing investments of Rs2 lakh crore in three years, Punjab Government unveiled its much-awaited Industrial Policy on Monday offering huge incentives for setting up new industrial units, and for expansion of the existing ones.
The financial incentives announced in the policy includes retention of value added tax (VAT) and central sales tax (CST), exemption on electricity duty, stamp duty, property tax in urban areas, and market fee, rural development fund, and infrastructure development cess. Besides, the policy also assured faster clearance to the projects.
“The new policy is aggressive, proactive, and incentive-based wherein all stakeholders, including industrial associations, entrepreneurs, and concerned Government departments have provided inputs. It is better than the earlier policies.
This is most industry friendly policy in the country. Incentives are being offered for fresh investments and expansion of existing units, and a single window system will be set up for faster implementation of projects,” said Punjab Deputy Chief Minister Sukhbir Badal while unveiling the policy.
For the purpose, the State Government has divided the state into two zones — developed and lesser-developed areas.
The policy has offered maximum fiscal incentives to the areas falling in zone-I, that is less developed, including Fazilka, Ferozepur, Hoshiarpur, Gurdaspur, Pathankot, Sangrur, Bathinda, Mansa, Muktsar, Faridkot, Tarn Taran, and Amritsar to speed up industrial development there.
All the approved industrial parks, industrial focal points, and industrial estates in all districts of the State come under zone I.
Zone-II covers the districts of Patiala, Fatehgarh Sahib, Ludhiana, Moga, Jalandhar, Kapurthala, Shaheed Bhagat Singh Nagar (Nawanshahr), Rupnagar and Ajitgarh (Mohali).
In both zones, the policy offered fiscal incentives for seven to 13 years, depending upon the scale of investments.
EARN YOUR INCENTIVE’ POLICY
The policy also enabled the industrial units to earn their incentives. “Here, you you’re your incentives,” said Sukhbir. He explained, “Instead of depositing its VAT, the units can retain it up to the exemption level for setting up a factory here, you invest and get the exemption.”
FOCUS ON AGRO AND FOOD PROCESSING
The State Government made clear its intention of laying more focus on agro and food processing sector in line with State's ambitious crop diversification programme. The new policy offered tax incentives of up to 90 per cent of VAT irrespective of the zone, besides 100 per cent exemption in electricity duty, stamp duty, and property tax for these industries.
“Our focus will be on agro and food processing sector, we will encourage investments in processing of maize, basmati, wheat, and milk. Purchase tax exemption on wheat and milk purchased and processed within the State will be there,” said Principal Secretary Industries Karan Avtar Singh.
INCENTIVES, SIMPLIFYING PROCEDURES AND FACILITATION
Sukhbir said: “The new Industrial Policy focused on three points — incentives, simplifying procedures and facilitation. All earlier steps of screening committee and empowered committee have been eliminated with Punjab becoming the first State to provide online approvals in most transparent manner.”
Giving details of facilitation measures, Karan Avtar said: “We have given maximum concession to these industries. Punjab is the first State that has simplified the all procedures and documents, ensured transparent workflow, online application and approval, self-attestation of documents, third party certification of building plans, stability and safety etc, and payment gateway for online payments.”
He added that Punjab Pollution Control Board (PPCB) has already made the procedure online.
MOHALI, AMRITSAR AS IT HUBS
Mohali and Amritsar have been identified to be developed as IT hubs. State provided high incentives to IT sector, with 100 per cent VAT exemption, 100 per cent assured power supply, land at subsidised rates, among others.
“The land allotment would first be done in Mohali considering State Government’s earlier effort to develop the town as IT destination. Amritsar would be followed considering international airport, and Centre’s decision to set up its STPI here,” said Karan Avtar.
State Government has also announced to create a land bank of 5,000 hectares to accommodate new projects and industry expansion across the State.
ABUNDANT POWER BY DECember
Sukhbir maintained that the State would have sufficient power by the December this year. He said that no industry would suffer due to power shortage.
COMMITTEE TO DECIDE ON PURCHASE TAX
Punjab Cabinet in its meeting on Monday decided to constitute a special committee under the chairmanship of Chief Secretary Rakesh Singh to examine the issues including purchase tax on wheat, milk and cotton produced and processed within the State, food retailing, declaring of factory premises as Mandi yards, wheeling charges on import of power for entire industry and supply of un-interrupted power to IT industry.
The committee had been asked to submit its report within 15 days to the Cabinet.
‘New policy to trigger exodus of existing industry to other States’
Out rightly rejecting the new industrial policy unveiled by Deputy Chief Minister Sukhbir Badal, Punjab Congress on Monday said that it would prove another disaster for the industrial sector in the State.
“SAD-BJP Government had created so much euphoria about the industrial policy and it took them six years to draft the policy which proved to be anti-climax.
There is no incentive for the existing industry which is heavily burdened with taxes and facing stiff market competition due to taxes imposed on raw material.
Erratic power supply, forced industrial holidays, and high tariff rates are major bottlenecks in growth of industry,” said Punjab Congress chief Partap Singh Bajwa.
Bajwa said that small-scale industry was totally ignored. “Hopes of existing and small scale industry for getting incentives to compete in the market are shattered. Since Punjab is a land locked State, promoting small-scale industry would have been best option to boost the economy of State and provide employment to the skilled youth,” he added.
He added that the incentives announced for big industry by SAD-BJP Government would prove counterproductive in the absence of conducive environment for new investment in the State.
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