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Maharashtra targets Rs 5 trillion in investment

Maharashtra targets Rs 5 trillion in investment
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First Published: Sun, Oct 16 2011. 11 08 PM IST

Maharashtra chief minister, Prithviraj Chavan. Saanskrut Kumar/Mint
Maharashtra chief minister, Prithviraj Chavan. Saanskrut Kumar/Mint
Updated: Sun, Oct 16 2011. 11 08 PM IST
Mumbai: Maharashtra is drafting a new industrial policy to draw Rs 5 trillion as investment in next five years and create two million jobs. The focus of the proposed policy is post-investment care and doing away with delays in clearance for new industrial units.
A five-year policy ended in March, but no new policy has been announced due to differences within the cabinet on various sops to be given to the industry.
The state’s economic survey, released in February, pointed out that Gujarat has surged ahead of Maharashtra in attracting industrial investment. Maharashtra attracted Rs 6.95 trillion between June 1991 and March 2010, while Gujarat managed Rs 8.59 trillion.
Chief minister Prithviraj Chavan said the new industrial policy, to be released by October end, will aim at providing post-investment care to the investors and offering online tools for tracking the progress of investment proposals.
“We have set up an investment promotion cell within the industry department to help investors,” industry secretary K. Shivaji said. “Our officials and consultancy firm Ernst and Young (India Pvt. Ltd) will guide investors on getting permissions and clearances from various government departments and local authorities.”
Maharashtra chief minister, Prithviraj Chavan. Saanskrut Kumar/Mint
They will be able track the progress of their applications to various authorities online, reducing the interface and discretionary power of officials, Shivaji added.
The proposed policy will focus on the development of infrastructure, food processing and textile industries to create jobs. The draft policy, reviewed by Mint, has identified inadequate and costlier power, land acquisition and unavailability of skilled man power as major concerns.
The policy also proposes to continue with incentives such as refund of value added tax, or VAT, exemption from electricity duty and exemption from stamp duty, among others, to woo new investors.
The focus is being shifted from setting up industrial parks in areas where land is available to creating them in areas with better road, rail, air and sea connectivity.
Bajaj Auto Ltd’s chairman Rahul Bajaj refused to comment for this story as he was part of consultative process initiated by the government to prepare the new industrial policy.
“Our future investment in the state will depend on government’s policy on VAT, which has been a big setback. We have been waiting for a resolution the matter for seven months,” said Pawan Goenka, president automotive and farm equipment sectors, at Mahindra and Manhindra Ltd.
Chandrahas Deshpande, executive director of the Mumbai-based economic policy think tank Maharashtra Economic Development Council, said the aims of the government’s proposed industrial policy are laudable, but, to achieve these goals, the policy must make doing business in Maharashtra easier.
To create jobs, the government must promote small and medium enterprises and for that the state should promote industry-specific clusters, Deshpande added.
“We are also developing different strategies for attracting foreign investors from different parts of the globe,” industry secretary Shivaji said.
In the first half of the current fiscal, Maharashtra cleared investment proposals worth Rs 1.1 trillion. “No other state has cleared so many investment proposals... In 60% cases, land has been allotted and in some cases even work on the site has begun,” Shivaji said.
His department has started sending electronic newsletters giving a snapshot of the sector every month to all major industry associations in the country and Indian embassies and consulates abroad.
Shally Seth Mohile contributed to this story.
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First Published: Sun, Oct 16 2011. 11 08 PM IST