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Punjab would like to have its industry back

Read more on:    Punjab | Jalandhar | Eepc | Aap | Bjp | Sports Goods

Football Chowk in is the unofficial name of a traffic roundabout that leads to a street lined on both sides with shops selling . It is of no consequence that the actual location is called Shahid Asaram Road in Basti Nau, a manufacturing hub over the years for anything from cricket bats, hockey sticks to footballs. Many of the sports shops are now setting up stores in another area, Leather Complex on the Kapurthala Road, not very far from the Football Chowk, as the stores are growing in number. But that does not mean the sports goods manufacturing business has grown in this region.

On the contrary, “manufacturing of sports goods is dying,” according to Surjeet Singh Jolly, who owns Robinson Sports there. Shops are growing because people are shifting to trading from manufacturing due to shortage of labour. Football manufacturing, which provided an estimated 75,000 jobs in the region till some years ago, has gone to Pakistan in a big way, and much of the rest to China, according to Jolly. In fact, 90 per cent of gymnasium goods sold in India are manufactured in China. Export of sports goods from India is pegged at Rs 1,500 crore and local sales at Rs 5,000 crore.

On expectation from the next government at the Centre, a sports goods trader says, “Tax liabilities on exports should be reduced.”

As RK Cricket House, Anand Shuttle and Shankar Sports fade away, and roads turn towards Focal Point, ’s dream project for industrial units to offer all infrastructure facilities in one complex, the Engineering Export Promotion Council () office located there is busy making posters for a Poland visit to celebrate 60 years of ties between the two countries. In the midst of excitement, there are signs of gloom. Process of development is very slow and cohesive decision-making is missing, says Opinder Singh, deputy director, EEPC at Jalandhar’s Focal Point, which houses around 2,500 units. The Focal Point initiative has failed to tap the true potential of the place, say local businesses at a time when Jalandhar is seeing a close three-way fight among the Aam Aadmi Party, Congress and Bharatiya Janata Party.

Whether its Jalandhar or Bathinda, where the Congress is believed to have picked up in the last few days and the is making its presence felt, demands are similar: uninterrupted power (cuts extend up to two days in peak summer in many parts of the state), good roads, elimination of red tape, jobs, industry, better education and lower taxes.
 
The state, known for entrepreneurs like the Mittals and the Munjals, is now facing business closures and units are shifting out to other regions. Data shared by the PHD Chamber of Commerce and Industry in Chandigarh, shows 274 industrial units have shifted out of Punjab to other states with better facilities and tax structures between 2004 and 2010. The estimated investment that has been impacted because of the relocation is Rs 3,674 crore. In terms of central excise collection, Punjab’s kitty has dropped from Rs 2,786 crore in 2003-04 to Rs 729 crore in 2008-09, the chamber says.

Also, large industrial houses have continued to remain away from Punjab. There is some action though from big groups — Sunil Mittal’s Bharti group is opening a mall in Ludhiana and it has given Walmart, the world’s largest retailer, to the state with many wholesale outlets even as the two have parted ways now. Tata Realty, too, has recently opened a high-end mall in Amritsar. Among others, the Oswal group is operating an ice-cream chain across Punjab.

But absence of large industry is a talking point wherever you go. Distance from ports and closeness to the border with Pakistan are the big reasons for Punjab remaining confined to small and mid-scale industry, explain politicians and industrialists. Tax incentive packages given to neighbouring states such as Jammu and Kashmir, Himachal Pradesh and Uttarakhand, too, play a role.
 
Gian Bhandari, chairman, GB Tools, agrees the 2,000-3,000 km distance from ports is the biggest hurdle for industry to locate here. But he points to China to argue that the government could do more. “It is the responsibility of the Chinese government to transport goods from manufacturing hubs to ports.”
 
As one reaches the buzzing city of Ludhiana, once known as the Manchester of India for its hosiery and apparel manufacturing, streets reflect the election mood in the evening. At a crowded marketplace, a CCTV shop is doing brisk business, perhaps a little more in the election season, but the shopkeeper prefers not to talk. A fruit seller on the street side says his entire village is thinking of voting for the AAP, “because they are different”. But the is on their minds too.

When asked to list his aspirations from the next regime, Upkar Singh Ahuja, managing director, New Swan Autocomp, says similar perks should be given to Punjab businesses as have been given in adjoining states. He openly advocates a Modi government to bring in stability.

Before the next stop, the cab driver offers his take on the political scenario. “Akali should be voted out. Simranjit Bains, the independent candidate, should be the winner in Ludhiana.” Manish Tiwari, a Congress minister, is the sitting MP from Ludhiana, and is not contesting this time.
 
Vinod Thapar, a hosiery manufacturer and exporter, believes it is a good idea to have the same government at the Centre and the state of Punjab, which has seen just a 7 per cent rise in gross state domestic product (GSDP) in the past seven years to touch Rs 164,525 crore in 2012-13. Thapar has complaints against the current Akali rule. There have been thousands of foundation stones but very few of those projects have taken off, says Thapar. He also grudges the fact that Ludhiana does not have an international airport yet, even as it exports to all major brands across the world. Amritsar is the only city in the vicinity to have an international airport.
 
Thapar points at the state of neglect in Punjab that has prompted the rise of Tirupur in Tamil Nadu as the hosiery hub for the world. In 1984, a delegation from Tirupur had come to Ludhiana, when it was at its peak, to understand the business. “Twenty years later, a Ludhiana delegation was sent to Tirupur.” By then, Tirupur was exporting worth Rs 10,000 crore a year while Ludhiana was stagnant at Rs 1,000 crore. Currently, Ludhiana exports are at around Rs 1,200 crore and Tirupur at Rs 14,000 crore after its numbers fell from Rs 19,000 crore due to the global economic slowdown. Ludhiana is estimated to generate domestic business of Rs 10,000 crore.
 
More than 100 km away in  Amritsar, Amarinder Singh of the Congress seems to have more supporters than the BJP’s Arun Jaitley, who even bought a Rs 1 crore house to project himself as an insider. Jaitley is confident of a win, even as his friend and cricketer Navjot Singh Sadhu has avoided campaigning for him.
 
As for Amritsar’s businessmen, they are engaged in campaigning too, many through tea parties and dinners where politicians can make a pitch. Ashok Sethi, director, Punjab Rice Exporters Association, who is caught up in election action, says the state should get out of the two-crop trend and focus on efficient cold chains to boost agro-processing. “The pesticide issue in basmati rice, for which consignments have been blocked in the US for three years now, must be sorted too.” Rice is a Rs 10,000-crore a year business from Punjab.
 
Large cutouts of Deepika Padukone drinking Coke seem to be among the unifying symbols of modernity across the urban and rural Punjab these days, apart from the racing Mercs, BMWs and Bentleys, even when the cellphone signal drops every now and then on important highway stretches.
 
Leaders are talking of minimising such contrasts. For instance, Jaitley, who is being projected as the future finance minister, is attempting to enthuse voters by listing out revival of the economy and better infrastructure as his agenda for governance. “If Gurgaon can get BPOs, why can’t Amritsar,” asks Jaitley at a rally. The Congress’ Amarinder Singh is largely focused on ending the drug menace that is killing the youth of the state apart from improving the business climate and infrastructure.
 
One will know soon whether these are empty promises or a real deal.

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