MP govt may withdraw facilities on fresh investment

The Madhya Pradesh government is likely to withdraw facilities offered on fresh investment to industries. It will do away with the investment promotion scheme or will prune it by 50 per cent.

Senior officials are also mulling over abrogating the category status awarded to various districts. At present, districts are categorised in A, B, C and D category to determine the quantum of incentives and facilities. The coming industry policy will spell out terms in detail.

“The investment promotion incentive scheme launched in the 2004 Industrial Promotion Policy has become redundant. The state government may cut its upper limit from 75 per cent to 50 per cent or will abrogate it,” a well-placed source informed Business Standard.

Diversification, expansion and technical upgrade of existing unit will get sops, concessions and facilities equal to those offered to the new units provided they make an investment of 30 per cent of the existing investment or Rs 50 crore (whichever is less). The small-scale units will also get facilities offered to the new units provided they expand, diversify or upgrade technically up to 50 per cent of the total investment on plant and machinery (which should not be less than Rs 25 lakh).

In case of micro and small pharmaceutical units, the assistance will be given if the company has invested Rs 10 lakh (other than plant and machinery) or 50per cent of the investment made earlier.

“The new provisions will put a mandatory clause on this facility that companies will be offered assistance provided they upgrade their existing registered capacity,” the source said.

Mega projects, or investment of Rs 100 crore in thrust sector will attract investment promotion assistance even if the investment is 50 per cent of the committed investment.

“The assistance will be extended for a period of additional two years,” the source informed, “while IT companies will get sops, assistance and concessions only in IT park.”

The government has also decided to do away with three special empowerment committees on investment as they have been notified in Trade and Facilitation Act, 2006.