Flawed policy created huge liabilities; benefits reaped only by few sectors like the cement industry, says Sitharaman
BY Our Staff Reporter
Guwahati, Jan 29: Union Commerce Minister Nirmala Sitharaman today insisted that the North East Industrial & Investment Promotion Policy (NEIIP), 2007, was suspended for "technical reasons" and said that a new policy to replace it was on the anvil.
Blaming the previous UPA government for the "loopholes" in the NEIIPP, Sitharaman said in the first five years of the policy, the Central government had earmarked Rs 700 crore. "But in those years, the policy created a liability of Rs 740 crore for the government," she said here.
She said a lot of misinformation has been spread by the Congress regarding the policy.
"To begin with, NEIIPP as a policy has several loopholes. It was an open ended scheme with no limit on the number of proposals to be accepted from the industries. However, a very limited budget was allocated for the same. Only around Rs 700 crore was earmarked for NEIPP in the 11th Five Year Plan. In contrast, the disbursement in a single year - 2014-15 - has been more than that," she pointed out.
She said the NEIIPP has resulted in "uneven sectoral growth with most of the benefits going to only a few sectors like the cement industry".
"There is a need to ratiolise this before re-opening the scheme for fresh proposals," the Union minister said, assuring that "the NDA government relentlessly committed towards the economic development of the region".
She said that a new industry promotion scheme for Northeast is being considered by the Fince Ministry through which the future funding could be re-routed through the DoNER ministry using its Non Lapsable Central Pool of Resources scheme.
The NEIIPP was an extension of the previous North East Investment Policy (NEIP) which was announced in 1997 by the Central government with a ten-year term period. NEIIPP was announced in 2007 and was due to end in 2017. As per the provisions of NEIIPP, industrial units in the region are eligible for 100% income tax exemption, 30% capital investment subsidy, excise duty benefits varying from goods to goods, interest subsidy, among others.
However, a circular by the Centre dated December 1, 2014 had suspended registration of new units under the policy.
Chief Minister Tarun Gogoi had been lambasting the Central government for the decision to suspend the policy.
Meanwhile, Sitharaman also expressed surprise at the "way the Prime Minister was being attacked" in different hoardings put up by the Congress in the city.
"In one such hoarding, the Congress asks what happened to the ST status for six ethnic communities. I want to ask what the Congress did during their ten-year tenure in the government. They do not have the moral right to ask such questions to the BJP," she fired.
On Friday, the Union Minister attended the Iugural Dialogue on Economic Development and Infrastructure in Guwahati held as part of BJP's preparations for a vision document 'Assam Nirman'.
This vision document which is expected to be completed by February will replace the manifesto.