K'taka's industrial policy targets 9% growth in GSDP

Karnataka on Tuesday unveiled a new industrial policy (2006-11) targeting a growth of over 9 per cent in the gross state domestic product (GSDP) as against 8.7 per cent achieved in 2005-06.

The policy includes incentives and concessions to support investments in small scale industries (SSI) and tiny industries.

After releasing the new policy, deputy chief minister B S Yediyurappa said that the thrust was on strengthening the manufacturing sector and enhancing Karnataka's share in national exports from the present 15 per cent to 20 per cent.

"We aim at creating an additional employment of 10 lakh by the end of the policy period through sustained and growth-oriented industrialisation," he added.

In an effort to promote industries in backward areas, the government has categorised the 176 taluks into three zones. The first zone consists of 76 most backward taluks, while second includes 85 backward taluks. Under the third zone, industrially-developed taluks have been included.

"Capital investment subsidy to the extent of 25 per cent in zone 1 and 20 per cent in zone 2 will be extended to tiny industries and SSIs. Similarly, all industries will be eligible for 100 per cent exemption of stamp duty in zone 1 and 75 per cent exemption in zone 2," industries minister Katta Subrahmanya Naidu pointed out.

To set up effluent treatment plants in all zones, a one-time capital subsidy up to 50 per cent of the cost (with a ceiling of Rs 1 crore per unit) will be provided. Entry tax and special entry tax are exempted for three years in zones 1 and 2 for procuring capital goods.

The exemption period for procuring raw materials for the two zones is five years, according to the policy, which will be in force retrospective from April 1 to March 31, 2011.

Concessions for investments in IT/BT sectors would continue as per the respective sectoral policies, the minister stated.

Naidu claimed that the policy addressed crucial issues relating to water and power supply to industries.

"Apart from facilitating mega industrial water supply schemes through special purpose vehicles, a comprehensive power policy will be evolved to encourage power generation from independent producers and captive plants," he said.

The government will also facilitate the preparation of gas distribution master plan to enable public/private sector players to bring in gas from diverse sources for distribution.

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