The Uttar Pradesh small scale industry (SSI) has expressed concern over state government’s policies, especially for the electrical equipment manufacturers.
The industry claims while other governments were giving sops to protect their industry and make them competitive, UP was not showing any effort in this regard.
SSI chamber Indian Industries Association (IIA) said a recent tender floated by state-owned power distribution company Madhyanchal Vidut Vitran Nigam had effectively put the small units out of the bidding process. The tender relates to the purchase of 50,000 transformers with the condition that the bidding company should have achieved a turnover of Rs 25 crore in the last three years.
“This has thrown out all the SSI units in UP from the tender race. These units will ultimately become sick resulting in revenue loss to the state exchequer, unemployment and setback to industrialisation,” IIA executive director DS Verma told Business Standard.
Though IIA had urged the government to withdraw the turnover condition, it did not succeed. Last week, an IIA delegation led by its president Anil Gupta met UP Power Corporation Limited CMD and principal secretary in this regard. Besides, VAT on several items, which otherwise are industrial inputs and machinery, are higher than other states. “Transformers are taxed at 4 per cent elsewhere, while in UP it is 12.5 per cent,” Verma added.
SSI occupies a significant position in the UP economy and accounts for over 60 per cent of the industrial output.