A New Industrial Policy

On Wednesday, Assam’s Minister for Commerce and Industry Chandra Mohan Patowary said that a new industrial promotion policy for the Northeast was likely to be announced by the Centre by April 2017.  While this is good news indeed for a region long starved of industrial development, it will not do to overlook the fact that the lack of industrial development in the region has not been because of a lack of policy or plans, but rather for the lack of implementation of the existing policy. The most recent industrial policy for the region was the North East Industrial and Investment Promotion Policy (NEIIPP) 2007 that remained suspended for some time. The Centre has now decided to remove the suspension of the NEIIPP 2007 and to implement it till its tural end on 31 March 2017. It remains to be seen whether the removal of the suspension of the policy for just three months will make any difference to the industrial development of the region. Referring to the minor modifications of the NEIIPP 2007, Patowary said that in its present form there is no component of freight subsidy, and capital subsidy is limited to Rs 5 crore. The other facilities stand as before.

There is no gainsaying that any serious effort for industrial development in any State or region calls for a well-charted and practicable policy framework that is forward-looking in its approach and uncluttered by too many procedural tangles. However, a policy statement alone is unlikely to take a State or a region very far unless the policy is backed up by efficient and expeditious implementation. Our experience tells us that implementation is the Achilles’ heel of the State governments of this region. We have never been short of ambitious plans and policies. Nor has there been any visible reluctance on the part of the Union government to provide fincial support for viable policy decisions on industrial development. The real reason for the lack of any worthwhile industrial development in the region during the last three decades or so is the unwillingness to put in the effort that implementation of policy decisions calls for. The only State in the region that has a couple of traditiol industries is Assam. We have long had our tea industry, and some industrial activity based on fossil fuels or petroleum got started around the middle of the 20th century. Lately we have also maged to add the cement industry on a limited scale to our catalogue of industries. In about three decades we have not been able to add anything new to our list of industries. The other States of the Northeast have practically no industries worth talking about. As a consequence, the very culture of industrial activity is missing from the Northeast.

It is heartening to learn from Assam’s Minister of Commerce and Industry that more than 25 big industries are in the pipeline for the Northeast and that the total investment on these industries is likely to be of the order of Rs 5,000 crore. According to Patowary, around 44,000 people will get direct or indirect employment through the proposed industries. He said that some major companies like ITC, Dabur and Patanjali have already made major commitments to start industries in the region. It remains to be seen how expeditiously and efficiently the plans for new industries get implemented. A very important requirement for industrial development in any region that has had no new industries for decades is to create the proper climate for industries. First of all, there has to be a single-window dispensation to speed up the execution of plans by industrial houses and entrepreneurs. Next, there is need for a sea change in the attitudes of the political executive and the bureaucracy to industry and industrial development. There is urgent need for skill development in the work force to make industrial activity viable. Filly, there is the need to augment our capacity to generate electricity to match the needs of burgeoning industrial activity. Our leaders must never lose sight of the fact that whatever the Centre might say about industrial development of the Northeast, the real hidden agenda of the Centre is to keep the Northeast as a hinterland of mainland India.