Dropped clause in Industrial Policy had 'misuse' potential: Govt

A contentious clause in the new Industrial Policy that allowed outsiders to develop estates in Jammu and Kashmir was dropped as it had the potential for "misuse", the state government said today, three days after taking the step under pressure from political parties and separatists.
State Finance Minister Haseeb Drabu explained in the Legislative Council as to why the government modified the policy and limited its scope to the state subjects.
"The thought behind the policy was that since government estates have no infrastructure, no facilities, so the intention of the government of the time was to give industrial estates to private investment so that there is infrastructure and the units in that estate can be local or from outside and it would function as a regular industrial estate," he said.

Subsequently, the industry associations, stakeholders, the civil society and a whole host of reactions came on one specific clause which was contentious, he added.
"That (clause) had the potential of misuse, which was pointed out also by the Finance (Department) that when they give incentive, they give it to unit and if the investment comes in the industrial estate, it will become free for all and hence, a re-look was required," he said.
"There was a need for an amendment, which we brought through a government order dropping that one para and substituting it with that the private industrial estates will be open to local industrial associations (only)," he added.

He said through the amendment, the policy has been restricted only to local industrial associations.

The Industrial Policy had come under severe attack from opposition parties as well as separatists, who had decided to carry out a campaign against it. The critics were of the view that the policy will weaken the special status of the state by allowing outsiders to engage in industrialisation.
The minister said the intention behind the policy was to get more and more private players into providing infrastructure for establishing industrial units.
Every industrial estate will remain under the supervision of their corporate body and all the units will become stake holders, he said.

Drabu said the industrial policy, since 1960, has allowed non-state subjects to set up units in the state and there is no bar on it.
Out of the 545 units that have been set up by the non-state subjects, almost 500 have come before 2005 and the first one -- Chenab Textiles -- was started in 1964 and in fact, today is the largest provider of employment in Jammu and there is no such violation there, he said.
Drabu's statement on the issue of the rollback of the controversial clause came after Legislative Council Chairman on Wednesday directed the government to make the statement on the reasons of the amendment after opposition members led by Congress MLC Ghulam Nabi Monga raised the issue in the House.