Seeks urgent course correction
SRINAGAR: The Federation of Chambers of Industries Kashmir (FCIK) has expressed grave concern over the emerging pattern of inequitable and imbalanced industrial growth in Jammu & Kashmir under the New Central Sector Scheme (NCSS), 2021, during a stakeholders’ workshop organised by the Directorate of Industries & Commerce.
The workshop was attended by senior officials from the Department for Promotion of Industry and Internal Trade (DPIIT), led by Director Rajesh Pawar, who chaired the session and heard the concerns of industry representatives. The programme was moderated by Director Industries & Commerce, Khalid Majid. The FCIK delegation presented a candid and comprehensive account of the ground realities confronting local enterprises.
FCIK, according to a statement issued here, pointed out that, much like the industrial package of 2002, the benefits of NCSS are once again getting concentrated in a few districts—primarily three districts of one region—leaving the remaining districts across Jammu & Kashmir excluded from the industrial growth process. This skewed distribution, the Federation noted, defeats the very objective of balanced regional development.
Highlighting stark disparities, the Federation informed that out of the total outlay of 28,400 crores, about 20,000 crores are set to be availed by just 18 large units. Such concentration of incentives, FCIK observed, raises serious questions about equity and inclusiveness in policy design and implementation.
The Federation also expressed concern that the scheme has once again left out the existing industrial base, which has sustained itself through decades of adverse conditions. FCIK stressed that exclusion of existing units from any meaningful support under NCSS has compounded their vulnerability and undermined their potential for revival, expansion, and capacity utilization.
FCIK urged DPIIT that corrective measures must be incorporated in the next phase or extension of the scheme, with incentives being equitably earmarked across all districts of J&K. It strongly advocated for inclusion of existing units under a dedicated window for revival, rehabilitation, and expansion.
The Federation further submitted that facilitating a bridge funding mechanism in the range of Rs.5,000–10,000 crores for existing units could unlock idle capacity and potentially generate employment for up to five lakh people.
The Federation also highlighted that even the limited number of units registered under the scheme are facing administrative delays and procedural bottlenecks.
Members pointed out that GST-linked incentive shortfalls for the first three years, which were to be automatically disbursed in the fourth year without additional documentation, remain pending despite compliance. Similarly, while the scheme envisages online processing, units are being compelled to submit exhaustive hard copies of bills, making the process cumbersome and defeating the purpose of digitization.
FCIK further raised the issue of genuine entrepreneurs who applied within stipulated timelines, invested substantial capital, and in many cases commenced production, but have been excluded due to procedural or technical grounds. The Federation urged that such units be treated as a distinct category under a separate bracket and considered for inclusion from savings from the scheme.
Sector-specific anomalies were also flagged. In mini hydel projects, critical components such as penstocks are being excluded from the definition of Plant and Machinery, thereby denying legitimate incentives. Likewise, civil works—constituting a substantial portion of project cost—are not being considered, despite similar treatment being extended to sectors like hospitality.
Concerns were also raised regarding units importing plant and machinery, where incentives are restricted to ex-factory costs, excluding customs duty, freight, and other associated expenses. FCIK termed this approach as impractical, noting that actual investment necessarily includes full landed cost.
Members expressed strong dissatisfaction over the widening gap between policy intent and ground-level implementation, observing that while the scheme is ambitious in design, its execution has been marred by restrictive interpretation, procedural rigidity, and lack of sensitivity towards genuine investors.