Amritsar SSIs face financial crisis

Non-disbursal of capital subsidy by state govt affecting enterprises

Small-scale industrial units in Amritsar, which are entitled to capital subsidy, are suffering from a financial crunch, because of the state government's failure to pay them the promised capital subsidy, as announced three years back, in its industrial policy.

According to sources in the industry, they are reeling under huge debt and loan.

The industry in this border area has suffered previously due to terrorism, as a result of which a number of units became sick.

The policy announced had also assured the industry that the government would make annual budgetary allocation of Rs 25 crore which would be distributed as capital subsidy on quarterly basis.

H S Makhni, general secretary of the Textile Manufacturers' Association said, "About three years back, the government, in its industrial policy had announced a grant of 30 per cent of the fixed capital investment to small scale industrial units in the border area. This announcement encouraged a number of entrepreneurs, who had suffered losses previously, to start new units in keeping with their spirit of entrepreneurship".

He added, "To start new units, entrepreneurs even mortgaged their assets, to meet the required norms. The element of subsidy became the basic premise of their project report, on the basis of which they started new units."

"Due to non-disbursal of capital subsidy by the state government, these units are in doldrums. They have started their units. Other formalities, including sanctioning of subsidy have been completed, but unfortunately the government has failed to honour its commitment of budgetary allocation and disbursal on a quarterly basis", he added. As a result, these units were reeling under debt and loans.

He appealed to Amarinder Singh, chief minister, Punjab, and Surinder Singla, finance minister, to consider this issue, and arrange for the disbursal of sanctioned cases of capital subsidy without any delay, in order to help these entrepreneurs keep their units running, and to maintain employment levels.

He said the matter had been taken up with the chief minister and the finance minister, and had also being represented at the Punjab Legislative Assembly at Amritsar.