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Industry body Associated Chambers of Commerce (Assocham), said non-availability of land is a major bottleneck for the growth of the industrial sector in Karnataka. The chamber has suggested the new government in the State to formulate a land acquisition and rehabilitation policy with options of equity partnership for land providers, employment opportunities, and stable monthly income among others.
In its action agenda for the new government, submitted to the chief minister Siddaramaiah, Assocham said, "Inadequate power supply is a major hindrance to new and existing industrial units in Karnataka. The state government should give sops and tax concessions to companies investing in locations with acute power shortage."
The Chamber has also suggested setting up district-level training institutes on a public private partnership (PPP) model to provide skilled manpower for the industries. Besides, special incentive package may be given to sectors like information technology, which has been affected due to global recession, J Crasta, Co-chairman, Assocham Southern Regional Council said.
"The state government must engage the private sector and introduce an investor-friendly industrial policy to boost the investment scenario in Karnataka by improving bureaucratic efficiency, infrastructure facilities and ease of land acquisition. There is also a need to provide tax concessions, product market conditions and exit policies which are certain effective tools of private investment attraction," Crasta said.
The chamber has also called for providing an investment friendly environment to attract foreign direct investment (FDI) and upgrade economic infrastructure, manufacturing facilities, infuse healthy competition for overall market development and update existing laws to protect rights and intellectual properties of investors. The state government must aggressively invest in upgrading the social and physical infrastructure, offer tax exemptions, incentives, schemes and subsidies to encourage investments from leading industrialists, the industry body suggested.
Industrially backward regions must be promoted through cluster development approach based on PPP model to spur investment and employment scenario, it said. For the growth and development of micro, small and medium enterprises (MSMEs) in the State, the chamber has suggested simplifying the credit guarantee procedures to meet long-term finance needs of MSMEs.
Besides, MSMEs should be further given capacity-building stimulus packages, tax concessions and subsidies for high-technology absorptions, said D S Rawat, secretary general, Assocham. The newly formed government of Karnataka has a herculean task at its hand to revive the growth of core sectors of agriculture and allied activities, industry and services which grew at a Compound Annual Growth Rate of 6.3 per cent, 12 per cent and 12.1 per cent during 2004-07 and dipped to the gloomy levels of 4.5 per cent, 3.4 per cent and 9.3 per cent respectively during 2008-11, Rawat added.
