- Post 01 December 2016
The notification has fixed an upper limit of Rs 5 crore for units in the manufacturing sector and Rs 3 crore for units in the service sector under the Central Capital Investment Subsidy Scheme. Another notification by the Centre has discontinued the Freight Subsidy Scheme (FSS), 2013, industrialists representing the Federation of Industry and Commerce of North Eastern Region (FINER) said. CCIS was 30% of the investment in plant and machinery without any upper ceiling as per the original policy.
"The confidence of investors has been shaken due to the frequent tinkering with and dilution of the NEIIPP 2007 and FSS 2013. If the Centre makes certain promises and goes back on them mid-way, how can the northeast see any industrial development?" FINER chairman Pabitra Buragohain said.
The recent notifications come at a time when the NEIIPP 2007 is about to come to an end in March 2017. The ambiguity surrounding the policy has led to capital investment to the tune of Rs 30,000 crore to Rs 50,000 crore being stuck in the pipeline in the last two years. This is all the more significant as the NEIIPP 2007 has been the single largest employment-generator outside the agriculture sector, FINER said.
"Local employment, both direct and indirect, has been generated due to implementation of the NEIIPP 2007. Employment opportunities were expected to grow," Buragohain said. He said at least 50,000 direct and 2 lakh indirect employment opportunities had been generated because of the policy.
The discontinuation of FSS 2013 is also a big blow, Buragohain said, adding that the move goes against the interests of industrial development in a region where communication infrastructure is yet to be fully developed.
FINER has demanded that NEIIPP 2007 be renewed till March 31, 2019 on pre-revised terms and conditions, and FSS 2013 be restored and kept in force till January 22, 2018, as per the original terms.
"The notification of dilution in CCIS by capping it up to Rs 5 crore should be immediately withdrawn and the originally notified incentive of 30% subsidy on investment in plant and machinery without any upper ceiling should be restored," FINER demanded.