Karnataka government has constituted an empowered cabinet sub committee under the chairmanship of chief minister D V Sadananda Gowda to approve requests from the new investors for grant of special concessions and incentives over and above what is mentioned in the industrial policy.
The committee includes industries minister and one or two other ministers as decided by the chief minister. This will cut short the delay and all the pending cases and new cases will be cleared faster. The committee will decide on providing VAT concessions and mainly conversion of VAT into 10 year interest free loans will be considered by the committee, K Jothiramalingam, principal secretary, commerce and industries department said.
Talking to reporters on the sidelines of CII Karnataka Annual Members Day function, here on Thursday, he said the government would soon issue a government order to this effect. “Presently, proposals regarding special incentives go through a lengthy process. Such proposals go through the finance department to get their concurrence and then take cabinet approval. The empowered committee will enable us to cut down the processes and come out with fast decision on giving specific incentives to mega investment proposals involving an investment of above Rs 250 crore,” he said.
The committee will also decided on the exact quantum of incentives and concessions depending on the places where the projects are set up, he said. The industrial policy of the state presently states that the government on a case-to-case basis would decide incentives and concessions for mega projects. The policy provides for stamp duty exemptions and land on a concessional rates.
Jothiramalingam said the government is planning to amend the Facilitation Act to speed up investment proposals.
“The government is moving an amendment bill during the budget session of the state legislative assembly to get the Facilitation Act amended. The department of commerce and industries has already approved the amendment to the Act. In the new Act, we are proposing to empower deputy commissioners to sanction investment projects up to Rs 15 crore from the present Rs 3 crore. Over Rs 15 crore and up to Rs 250 crore will be approved by the State Single Window Agency headed by the minister and over Rs 250 crore will go to the state high level clearance committee headed by the chief minister for approval,” he said.
The department has also proposed a cut off date for various departments for approving projects. “We are fixing certain timeframe for the departments to give their approval for projects. If they don’t give their approval in the stipulated time frame the projects would be deemed to have cleared,” he said.
The government has received interest from the Hinduja Group for making investment in the defence, higher education and power sectors in the state, which would be cleared during the global investors’ meet 2012, he added.