NEW DELHI, March 26: Tura MP, Agatha Sangma urged the Centre to come up with an industrial development policy exclusively for the Northeast to bring the region on a par with the mainland.
Speaking in the Lok Sabha, she said the previous North East Industrial Development Scheme (NEIDS) failed due to limitations and as a result, most industries shifted to states such as Himachal Pradesh and Uttarakhand because of their locational advantages.
She was participating in the debate on demand for grants for the Ministry of Commerce and Industry on Thursday.
The industrial policy should be exclusive for the Northeast since the region is far away from the mainland, connected only by a chicken neck corridor, the MP said. She demanded that Central GST and IT exemption must be 100% to the investors investing in the region.
Agatha said the maximum incentive of Rs 5 crore in the NEIDS for capital investment discouraged big investment in the Northeast.
Any expansion of the industrial units was also not covered in the policy due to which local industries were discouraged to invest further, the Tura MP added.
Since NEIDS was also extended to Uttarakhand and Himachal, the investors preferred these states as they are easily accessible, Agatha said.
“As a representative from the northeastern region, I demand the government to extend the period of new industrial policy for Northeast by a minimum of 10 years,” Agatha said.
Besides new units, existing units undergoing expansion should also be eligible for incentives, she demanded.
“There should not be any upper limit for capital investment subsidy and freight incentive on raw materials. Finished product must be allowed from factory to original points through rail, road, water and airways,” Agatha said.
She said tea, cement and steel rolling mills should be removed from the negative list and the government should start special incentives for development of sectoral parks, commercial infrastructure.
Speaking about Meghalaya, Agatha said the hill state is blessed with minerals such as limestone, China clay, quartz which had brought substantial investment in the cement sector by providing direct and indirect employment to a large number of people between 1997 and 2007. In NEIDS, cement (but not clinker) and steel rolling mills have been kept in the negative list which has got no rationale at all, she argued.
Going by past records, the Tura MP said between 2017 and December 2020, only 104 industrial units have been registered under NEIDS. She said Meghalaya got a meagre investment of Rs 25 crore during the period.
Agatha demanded that the Centre set up more PSUs or job-oriented investment like rail coach factory and steel industry in the Northeast. This will help to generate employment which is very low in the region in comparison with other parts of the country, she said.
Further, she demanded that the Tea Board of India headquarters be shifted to Guwahati from Kolkata as Assam is the largest producer of tea in the country. She said some special policy may be introduced to incentivise the quality and organic tea production and incubation centres may be set up and special incentives provided to start-ups.
Agatha pointed out the grim export scenario of the Northeast, which has over 98% of its border with foreign countries and close to clusters of Southeast Asian nations. Eight states of the Northeast put together share less than 1% of exports which is abysmally low when compared to the total exports from India, she said.
She said through the framework of Act East Policy, India seeks to achieve deeper political and economic development goals for the region by creating sophisticated markets and connectivity links between the region and Southeast Asia. She said potential investment from ASEAN is considered strategically important for the proximity to the region.
“The budgetary allocations made to Agricultural Product Export Development Authority, Marine Product Export Development Authority and plantation boards such as tea, coffee, rubber and spices in budget estimates for 2022-23 are very low,” Agatha said.
“The Standing Committee had already opined that insufficient allocations to these heads would negatively impact the exports of agricultural and marine products, tea, coffee, spices, natural rubber and rubber products,” she said.
Even within the region, a major chunk of the export is from Assam and a minuscule trade is from the rest of the seven states, she said.