CII opposes extending excise package in HP

At a time when the Central government is willing to extend the existing Central excise package to Himachal Pradesh for three more years, a prominent business lobby has opposed the move.

"As the Confederation of Indian Industry is in favour of setting up of a common economic zone (CEZ) for northern states, the extending of the Central industrial tax free package to Himachal will go against the spirit of the CEZ," said Adesh Gupta, chairman CII northern region, here on Wednesday.

"The state government tells us it has already received a substantial amount of the expected investment from industry due to the package," he said.

Gupta has recently taken over as the CII (north) chief and was here to meet the Chief Minister Virbhadra Singh and Industries Minister Kuldeep Kumar.

The Confederation of Indian Industries felt that the land alloted to industries in the state had been exhausted and so it would not be wise to invite more industry with the help of Central tax free package, Gupta said.

The CII had a vision for the northern region and this could happen only with the abolition of multiple tax structures, free movement of goods and creation of new synergies in the region, he said.

The Central industrial package to Himachal came into force in early 2003 and since then industry from the neighbouring states and other parts of the country have moved into the state to avail the attractive tax benefits as a result of which the state government has already attracted investment proposals of Rs 17,500 crore.

The package is to expire in March next year, but the United Progressive Alliance (UPA) is considering extending this package to Himachal Pradesh and Uttaranchal for another three years.

The two governments had earlier forced the Centre to bring this excise package down to 2007 from 2013 .

A minister in the UPA government had recently told Business Standard here that as a compromise the industrial package would now be extended to 2010.

However, the CII has intervened in favour of Punjab, Haryana and other states of the country that constantly complain of industry moving out of their states to the two hill states of Himachal Pradesh and Uttarnchal.