Centre cites fund crunch for suspending policy

Industrial & Investment Promotion in NE

By Our Staff Reporter

Guwahati, May 8: The North East Industrial and Investment Promotion Policy (NEIIPP), 2007, has not been cancelled or withdrawn, the Centre clarified today, stating that fresh registration of industrial units for claiming benefits of the schemes under the policy has been suspended temporarily.

The Centre’s statement came days after a hue and cry was raised in the region following suspension of the policy since December 1 last year.

State governments of the region had raised serious concern over the issue of suspension of registration of units under the policy.

In a letter to Minister of State (Independent Charge), Commerce & Industry, Nirmala Sitharaman recently, Assam Chief Minister Tarun Gogoi had requested her to withdraw the circular on suspension of registration of units under NEIIPP, 2007 as it would ‘not only affect the industrial sector but also the economy of the entire North Eastern Region.’

Union commerce ministry officials said that fresh registration under NEIIPP, 2007 has been suspended due to resource crunch. They also reiterated that subsidy claims under NEIIPP, 2007 would be considered based on budget allocation of the department.

“Fresh registration of units has been suspended as the committed liabilities under the package are far greater than Annual budget allocation. However, the scheme has neither been cancelled nor withdrawn. There is no proposal for discontinuing the scheme at present. A number of initiatives have been taken in the recent past for smooth implementation of the scheme,” the Union ministry stated.

The ten-year policy was launched in 2007 to promote industrialization in the States of North Eastern region. Salient features of this policy are grant of (i) Central capital investment subsidy @ 30% of investment in plant and machinery, (ii) Central interest subsidy @ 3% of working capital loan availed for a period of 10 years from the date of commencement of commercial production (DOCP), (iii) reimbursement of insurance premium paid towards insurance of fixed capital assets for a period of 10 years from DOCP, (iv) Excise duty exemptions for a period of 10 years from DOCP and (v) Income tax exemption for a period of 10 years from DOCP.

Units have been set up both in the manufacturing sector and services sector, covering various fields such as pharmaceuticals, steel and rolling mill, cement, FMCG, packaging, poultry feed, ferro-alloy, bakery, hotels, hospitals, power generation, etc.

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