New Delhi, Jan 15 (KNN) To create an enabling environment for industrial development and to provide a fillip to private investment in these states, the Cabinet Committee on Economic Affairs (CCEA) has approved the extension of the special package of industrial incentives for Himachal Pradesh and Uttarakhand.
The scheme has been extended from January 7, 2013 to March 31, 2017, according to an official notification.
“…the UPA Government has always been sensitive to the aspirations of the hill people. This decision will catalyse industrial development in Himachal Pradesh and Uttarakhand and generate gainful employment especially for the rural youth. It will also give a fillip to manufacturing and the Small and Medium Enterprises in these two states,” said Commerce and Industry Minister Anand Sharma welcoming the decision of the CCEA.
The scheme will encourage private entrepreneurs to set up more industrial units in these states, leading to overall growth and industrialisation and generation of more employment.
All new industrial units and existing units on substantial expansion would be eligible for Central Capital Investment Subsidy at the rate of 15 per cent of investment in plant and machinery subject to a ceiling of Rs 30 lakh.
Further, the cap on amount of subsidy will be raised from Rs 30 lakh to Rs 50 lakh for MSME units at the rate of 15 per cent of their investment in plant and machinery, it said.
Subsidy would be available to all new and existing units on substantial expansion located in notified areas as well as to “thrust industries" for units located anywhere in these states.
Incentive on substantial expansion will be given to units affecting an increase by not less than 25 per cent in the value of fixed capital investment in plant and machinery for the purpose of expansion of capacity, it said.
The New Industrial Policy and other concessions for Himachal Pradesh and Uttarakhand were announced on 7th January, 2003 for a period of ten years to provide the required incentives as well as enabling environment for industrial development, improve availability of capital and increase market access to provide fillip to private investment.
Himachal Pradesh has been able to attract 300 per cent more investment as compared to the pre-incentive package level. On an average, total investment generated in Himachal Pradesh is above Rs 12,500 crore and number of units set up has grown by 28 per cent while growth in employment generation is more than 33 per cent.
In Uttarakhand, investment generated is close to Rs 30,000 crore, which is 42 times the level in the year 2000. The number of units set up has grown by more than 130 per cent while growth in employment generation is more than 490 per cent for the same period.