Punjab plans big push for small sector

In order to facilitate SMEs in the state The Punjab Small Industries & Export Corporation limited(PSIEC) will sign a Memorandum of Understanding (MoU) with the STC (State Trading corporation) in the first week of November.

The MoU would be aimed at providing raw material to SMEs at competitive prices.

In an interaction with Business Standard, Prinicipal Secretary, Department of Industries & Commerce, A R Talwar said, "PSIEC will sign an MoU with STC next month in order to provide basic raw material to SME's at competitive prices."

This is likely to help the SME sector especially on the raw materials front where they always face problems on the supply and pricing parts. At present PSIEC offers only steel to the SME sector.

According to the exporters, online trading in metals such as copper, brass and zinc is adversely affecting the supply of basic raw material to the SME manufacturing sector, but, with the agreement with STC, assumptions are there that their problem would be sorted out.

Among other initiatives, Talwar also said that the state government is in discussion with the Indian Institute of Foreign Trade (IIFT) for the setting-up of an insitute in Punjab.

"We have earmarked 12 acres of land near Ropar for the proposed insitute," he added. He also said that they have approached IIFT to study the export potential in Punjab and to find out the items which have a great export potential.

Commenting on the new developments he said, " We have received proposals from three companies to set up ICDs in Ludhiana and Amritsar. Elaborating further, he said, "Out of the three, one is Amritsar-based, the second is Ludhiana-based while the third is a Singapore based company. We have two proposals for Ludhiana and one proposal for Amritsar."

A R Talwar was addressing the 4th Meeting of Sub-Committee of State Level Banker's Committee in Chandigarh organised by the Punjab National Bank.

Talking about Punjab's Economy vis-à-vis India's economy, PNB executive director, J M Garg said that over the year spower deficiency, stagnation in agriculture growth, lack of a level playing field for state's industry in view of the tax holidays in neighbouring hill-states, etc has affected the state's economy.

Consequently, GDP growth of Punjab is just 6 per cent, as compared to the national GDP growth of 9 per cent.

Now, economic resurgence is the only way for Punjab to regain its glory as the preferred investment destination and become a part of India's economic growth story.

Exports from Punjab during 2006-2007 was Rs 1,1798 crore while it were Rs 9,656 crore during 2005-2006. Also, the share of exports of Punjab in the total exports of India as on March 2007, is stagnant at 2.12 per cent.

District-wise exports also reveal that exports from Ludhiana (Rs 8,287 crore) ranked 'first' followed by Jalandhar (Rs 1,984 crore), Amritsar (Rs 1,225 crore) and Kapurthala (Rs 202 crore).

Among the commodities which have shown positive growth are rice, hand tools, machine tools, auto parts, sewing machines, cycle and cycle parts, food products and leather goods.

However, export of yarn and textiles has declined during 2006-07 as compared to the previous year.