To lure shying investors in underdeveloped sectors such as health, food processing, horticulture and information technology Madhya Pradesh has offered some conditional sops by amending the existing Industrial Promotion Policy 2010. A few, such as interest subsidy, concessional land and exemption in payment of premium on land in some sectors are very small compared with the size of investment.
The state has made and amendment to Industrial Promotion Policy 2010 has and will present it in the forthcoming Global Investors Summit, which is being held at Indore on the 28th of this month. The three-day mega-event, however, has received a lukewarm response from big-ticket investors due to shortage of land, coal mines and water in the state.
According to the amended policy, industrial parks and high-tech parks developed by private investors will be offered special incentives of Rs 5 crore or 15% of the total development expenses incurred, provided the investment has been made in an area of 100 acres, has 10 units and has created direct jobs for 250 persons. Of these, 50% jobs should be reserved for locals.
“The government has already jacked up the prices of land in all areas; private land is not available at cheaper rates. The offers will make not much impact on the government’s efforts to lure investors,” a senior executive of a company, who dropped an investment plan in Madhya Pradesh, told Business Standard.
Investors in information technology will be offered land at 25% of the prevailing government rates provided they create jobs for minimum 100 professionals. Also the government has offered concessions and sops to the health care sector, which recently got industry status. An investor who has plans to open a medical, nursing or para medical college will be offered subsidy of a maximum of Rs 5 crore.
Investors in information technology will be offered land at 25% of the prevailing government rates provided they create jobs for minimum 100 professionals. Also the government has offered concessions and sops to the health care sector, which recently got industry status. An investor who has plans to open a medical, nursing or para medical college will be offered subsidy of a maximum of Rs 5 crore.
The State has also defined and categorised micro, small-, medium- and large-scale investors to offer sops and concessions. A unit which has plant and machinery worth Rs 25 lakh or less will be considered as micro unit, Rs 5 crore plant and machinery unit will be considered as small and a unit up to Rs 10 crore investment will be considered as medium scale unit. All units which have more than Rs 10 crore investment will be considered as mega industries.
To attract more investment in warehousing sector the government has offered 15% incentive on Rs 1 crore investment. “They have also offered freebies interest subsidy and grants to those who have already constructed warehouses, is it logical?” asked the investor.
In another interesting offer, state has put a mandatory condition for hoteliers if they want to avail freebies. “Any hotelier who invests in budget hotel at places of religious importance will get Rs 50 lakh (maximum) incentive however the hotel should have minimum 50 rooms and the rent should not be more than Rs 2,000,” a government official said. This is for the second time the policy has been changed.