The Himachal Pradesh government has not received any major industrial investment proposals in the last six months. With the relentless economic slowdown, this trend is not likely to change in some time, say observers.
Investors are also worried whether the state government will be able to convince the Centre to extend the central excise package to 2013 as the current package expires in early 2010.
Neighbouring states like Punjab and Haryana are against the extending the excise package to Himachal Pradesh. This along with reluctance of financial institutions to liberally finance companies is also keeping away investors.
As if this wasn’t enough, it remains to be seen if the state government will be able to capitalise on the investment that has already been promised by companies in the last six years.
According to a survey of the state industries department, setting up of industrial units is considerably slow. So far, projects worth Rs 5,000 crore have been completed in the last six years.
At this rate, the total investment on the ground isn’t likely to exceed Rs 10,000 crore by 2010, experts say.
Ever since the central excise package was announced in early 2003, the state’s single-window clearance committee has cleared industrial investment proposals worth Rs 35,667 crore with a potential to create 4,08,000 jobs, mostly for locals.
According to latest count, 11,404 new industrial units and 321 expansion projects have been approved, sources in the state industries department say.
The major projects to be completed before the industrial package expires in 2010 include two cement plants worth an investment of Rs 1,800 crore.
“Steel Authority of India (Sail), Indo Rama and Solaryan Tech are the firms which will soon bring in an investment of Rs 3,000 crore. Our strategy is to pursue major investment projects to attract maximum investment before the excise package expires in 2010,” said state Principal Secretary (industries) Subhash Negi.
Even though the excise package expires in 2010, the income tax exemption will continue till 2013.
