Says government proposed facility at Sopore doomed to be loss making

SRINAGAR: Federation of Chamber Industries Kashmir (FCIK) has demanded that government should support the existing unit holders to fulfil the demand of the packaging and has taken a strong note of government’s plan to establish 40 MT integrated pack house at Doabgah Sopore,as it seems that government is giving birth to one more Loss making PSU. On the one hand the government is planning to disinvest the PSU’s and establishing of new one seems to be a disaster and repetition of the government mistakes is unwarranted.
In a statement, FCIK President Mr. Shahid Kamili said the establishment of pack house by the government at Sopore will deal a severe blow to the existing pack houses established by local entrepreneurs. Kamili said there is no need to establish additional facilities when private entrepreneurs have already established around 150 state of art corrugated cardboard manufacturing facilities worth Rs 750 crores at various places catering to the Valley’s horticulture produce successfully.
It said the existing installed capacity of packaging products is more than the demand of the horticulture crop from the Valley and the additional facility by the government would also be a loss making unit.“It seems that government has not learned from its various loss making PSUs. This facility would not only prove white-elephant for the state exchequer but will also destabilize facilities put up by the local entrepreneurs. The non-functioning of the Government PSUs have proved that the PPP models have failed. Government should instead help the existing units to give fillip to private sector,” said FCIK.
FCIK Secretary General, Ovees Qadir Jamie said that the packing industry is already saturated and ruthless competition has pushed the existing units to the wall, the existing units should be further augmented with Government hand-holding and supportive measures. FCIK said the existing units provide employment to around 2500 youth directly and 10000 indirectly who will also stare at expulsion if government facility comes up and unneeded capacity increase will misbalance the economies of scale of the sector. Jamie said that the government should monitor the tax evasion of the horticulture packaging products coming from outside J&K which have affected local horticulture Packaging industry badly.
FCIK has urged the government to impress upon the Jammu and Kashmir Horticulture Planning and Marketing Corporation to cancel the tender inviting bids for the construction of 40 MT integrated pack house at Doabgah Sopore and also sign MoUs with existing units so that government provides them the marketing support to their business venture. Government should take local industry leaders on board before making such decisions as the local unit holders are aware about the current industry status and how it can be promoted. As the current supply from the existing units is enough and as per the required standards which is needed to be augmented by the government hand-holding and demands marketing support.

KR Desk