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The Congress-NCP coalition government had termed it a “game-changer” in taking on competition, especially from neighbouring Gujarat and a couple of other states. However, the slow pace of inter- departmental movement of the necessary file has delayed the issuance. The NIP had been announced after a year’s delay, following the lapsing of NIP-2006 in 2011.
Officials of the industry department (with the Congress) blame the finance ministry (held by the NCP). “The delay has been due to certain objections raised by the finance department with regard to the slew of incentives offered in the NIP. These objections could have been raised when the cabinet gave its nod on January 2 and the announcement of which was formally made on January 3,” an official said.
The finance department denies any delay from its side. “The file came to the department on February 1 from the industries department and was sent back after scrutiny on February 12,” an official said.
The NIP says it aims to attract investment of Rs 5 lakh crore and job creation for two million people in the next five years. It has proposed exemption in value added tax, stamp and registration duty, electricity duty and reduction in power rates, in a bid to shift investments to the under-developed and Naxalite-affected districts from the “golden triangle” of Mumbai-Thane-Pune. The NIP focuses on promotion of micro, small and medium scale enterprises (MSMEs). It has proposed a rebate in electricity rates for MSMEs. Also, conversion of Special Economic Zones into integrated industrial areas where it is mandatory for the developer to use 60 per cent of the land for industrial use. Thereafter, they may be allowed to use 30 per cent of it for residential and 10 per cent for commercial purposes.
C S Deshpande, director (research), World Trade Centre, said the government had hurriedly produced a policy document which merely took forward some micro-aspects of previous policies, without the required detail to problems on infrastructure, ease of doing business for SMEs, labour reforms and easing of land acquisition for industry.
