MP to set up trade promotion body

New industrial policy announced, detailed plan for power projects likely in July

To promote trade, the Madhya Pradesh government has decided to set up a trade and investment felicitation corporation. The new body, which will be constituted by altering the MP Export Promotion Corporation, will be autonomous and function as a secretariat.

Announcing the new industrial policy, an official spokesman said under the new policy, the government would constitute the MP Trade and Investment Felicitation Corporation, which besides speeding up the clearance of proposals through a single-window system would improve infrastructure, simplify rules and make special programmes to enable sick industries overcome their problems.

New empowerment committees will be set up through the introduction of the Industrial Felicitation Act.

The proposals for the power sector mentioned in the draft Industrial Promotional Policy and Action Plan, 2004, have been deleted as a new energy policy will be announced at a later stage.

"We will come up with a detailed plan for power projects, which will be announced next month," Vishwapati Trivedi, principal secretary (industries), told Business Standard.

He said the government had not exempted existing captive power plants from the electricity duty or cess as published in a section of media. But new power projects would be exempted from duty if the power project started production within two years of its commissioning, he added.

The district-level investment promotion empowerment committee will be vested with powers to clear investment up to Rs 3 crore, while the state-level committee will have the power to clear projects above Rs 3 crore and up to Rs 25 crore.

The apex investment empowerment committee will have the power to clear projects worth over Rs 25 crore. This committee will function under the chairmanship of Chief Minister Uma Bharti.

An industrial infrastructure development fund will also be created. The fund will make an amount of Rs 10 crore available for industry for the next five years and will be used as a revolving fund.

The government will also appoint autonomous bodies soon to do away with the two-tier taxation system for the maintenance of industrial areas and development centres. The MP Municipal Corporation Acts 1961 and 1965 and MP Panchayat Act will be amended for the purpose.

Under the new policy the government will offer an industry investment promotion assistance to units investing Rs 1-10 crore. The interest-free loan will not exceed 50 per cent of the total tax paid (75 per cent in case of projects with an investment of over Rs 10 crore) by the unit (excluding the commercial tax on raw material purchases).

The government will make provisions for the scheme in the budget of the industries department. The amount will be adjusted against the tax payable in the following year.

The government will offer 5-20 acres of land in industrial areas or development centres at a fourth of the market rates if the project is worth more than Rs 25 crore.

A new scheme, the Din Dayal Rojgar Yojana, will be launched for unemployed youth.

The new policy also offers exemptions from stamp duty and registration fees (on certain conditions), exemption from mandi tax on agricultural products purchased from outside the state as raw material for food processing units.

Also, a special grant will be offered to industrial or software parks developed by the private sector, provided that these have a minimum of 100 units.

A textile cell will also be set up and the powers of the textile commissioner will be vested in the industry commissioner. The new industry policy will also rationalise tax rates on automobile components and raw material like steel.

The state government has also offered a special package of for sick or closed units. These units will be exempted from paying the minimum power tariff (for the duration of the closure of the unit) charged by State Electricity Board. They will also be exempted from paying commercial tax (on the fulfillment of certain conditions).

The Cabinet also decided to set up a Madhya Pradesh Roads Development Corporation and implement the Madhya Pradesh Water Sector Restructuring Project.