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Entrepreneurs and public representatives of the Telangana region on Friday opposed the special category status (SCS) being promised to the residual state of Andhra Pradesh.
They said the SCS, which also comprised a host of central tax incentives to industries, would de-industrialise the Telangana state by triggering the flight of capital as well as closure of the remaining units that could never compete with those who enjoyed huge tax benefits in the residual AP.
“All these tax incentives will form 10-15 per cent of the sales revenue of a company. It is certain that nobody will come forward to set up units in Telangana if the neighbouring state begins to offer this level of incentives. All those who have their operations in Telangana will also shift their base to residual AP. Forget about the manufacturing growth here,” said J Nrupender Rao, chairman of Hyderabad-based Pennar Group.
My Home Group chairman Rameshwar Rao said the entire south India would suffer along with Telangana if the Centre accorded the SCS to Seemandhra.
Rao and other speakers who addressed a seminar on ‘Industrial development in Telangana, problems, prospects with focus on special category status’ organised by the Telangana Industrialists Federation(TIF) here demanded the Government of India to extend similar package of incentives to maintain a level-playing field between the two states.
“The SCS states enjoy concessions in excise and customs duties, income tax rates and corporate tax rates. This factor in the hands of a non-deserving state can have a devastating effect on other states,” TIF president K Sudhir Reddy said, while arguing that Seemandhra does not meet even a single criterion for SCS.
Telangana Joint Action Committee(JAC) chairman M Kodandaram said the industry would not survive in Telangana if the other state enjoyed the SCS. “The Government of India had promised that the two successor states will get equal incentives. Now, they have to keep their word,” he said, while asking the political leadership of the region to make industrial development as the number one priority.
Former industries minister J Geeta Reddy, Lok Sabha member G Vivekanand and other political leaders said they would lobby and fight for the equal status in terms of incentives for the industries in Telangana.
Setting up of Telangana Development Bank with a capital base of Rs 5,000 crore, a venture capital fund to support the local entrepreneurs and an entrepreneur training institute to train the budding industrialists were among several suggestions that were discussed during the event.
