The state government has sanctioned Rs 300 crore for industrial subsidies and tax rebates for investors. Majority of this amount will be spent on the capital subsidies and exemptions of duties and tax.
According to the outcome budget, which was laid in the state assembly today, the state government has allotted Rs. 300 crores for industrial subsidies and exemptions. The budget document was laid in the state assembly today. The amount will be spent on the reimbursement of VAT, capital subsidies, electricity duties exemption and grants for purchase of generators. "Almost Rs 200 crores of this amount will be spent on the capital subsidies. Apart from this, tax reimbursement and electricity duties exemption will also have large shares in this money," said one of the industrial department sources. These subsidies and exemptions were announced under the new industrial policy of the state government, which came into effect in 2011.
The amount is almost equivalent to current fiscal's allotment for the industrial subsidies. Till date the state government had provided Rs 200 crores subsidies to the entrepreneurs. Out of this, Rs 100 crores had been provided to food processing units as capital subsidy. Rest of the amount was allocated for electricity duties and other tax exemptions. The state provides 35 percent of the total project cost as capital subsidies for food processing units. It also provides 80 per cent reimbursement of VAT for 10 years under the enterprise promotion programme.
However, the hefty industrial subsidies failed to make any impacts on entrepreneurs. One investor commented, "The state government has not done anything to improve its system. Still the investors have to wait for months to get their subsidies. The delay makes these subsidies useless." Government officials accept problems and promise change in near future.
"We know there are problems, but we are working on them. We have taken many steps to fasten the process. We will do more," said one of the state government officials.
