Maharashtra government, which is striving to tackle the rising competition from various states in attracting investments, has allocated Rs 1,480 crore towards industrial promotion subsidy (IPS). Industrial units including automobilies under this scheme get IPS equivalent to VAT paid by them.
As written earlier, the government has not withdrawn rules amended last year for value added tax (VAT) set offs. The new regulations say that the car manufacturers are only eligible for VAT set offs for vehicles that are sold in the state. The move has met stiff opposition from vehicle makers who are now considering other locations to move their facilities. However, the government hopes that auto units would benefit under the IPS scheme.
State finance minister Ajit Pawar during presentation of annual budget for 2012-13 said the government had paid IPS of Rs 2,400 crore during 2011-12. He assured the legislature that the government though has made an allocation of Rs 1,480 crore during 2012-13, it would further increase it if necessary.
According to Pawar, the state's IPS scheme was the most attractive one which resulted in attracting investments in 59 new mega projects and 10 existing projects worth Rs 79,462 crore in 2011-12 in the state.
Further, Pawar said the government would soon announce a new industrial policy to enhance the pace of industrial growth and create conducive environment for industrialisation. According to the finance minister, the government intends to offer concessions in electricity tariffs, VAT and interest subsidy for medium and small scale industries in the proposed new policy.
In a bid to give a push to investments in the textiles sector, as proposed in the state textile policy, Pawar has provided an outlay of Rs 90.83 crore during 2012-13. Under the new textile policy, the additional interest subsidies have ben proposed for the projects selected under the Textiles Upgradation Fund Scheme. According to Pawar, Rs 500 crore has been allocated towards electricity subsidy for the powerloom industry.