Rs 28K-crore central scheme to boost industrial development in Jammu and Kashmir

08-01-2021

The Cabinet Committee on Economic Affairs chaired by Prime Minister Narendra Modi has approved an ambitious central scheme to boost block-level industrial development of the state. The Central Sector Scheme for Industrial Development of Jammu and Kashmir will have an outlay of Rs 28,400 crore up to 2037. The objective is to generate jobs leading to socio-economic development of the area and to boost industry and service-led development of J&K, thereby attracting new investment. The scheme will offer many incentives, among them capital investment incentive at the rate of 30 per cent in Zone A and 50 per cent in Zone B on investments made in plant and machinery (in manufacturing) or construction of building and other durable physical assets (in service sector). Units with an investment upto Rs 50 crore will be eligible to avail this incentive. Maximum limit of incentive is Rs 5 crore and Rs 7.5 crore in Zone A and Zone B, respectively. The capital interest subvention will be offered to an annual rate of 6 pc for a maximum of seven years on loan amount up to Rs 500 crore for investment in plant and machinery (in manufacturing) or construction of building and all other durable physical assets (in the service sector). The GST-linked incentive will be 300 per cent of the eligible value of actual investment made in plant and machinery (in manufacturing) or construction in building and all other durable physical assets (in service sector) for 10 years. The amount of incentive in a financial year will not exceed one-tenth of the total eligible amount of the incentive. The working capital interest incentive of the scheme will cover all existing units at the annual rate of 5 per cent for a maximum of five years and the maximum limit of incentive is Rs 1 crore. The scheme is ambitious as it offers attractions for both small and large units. Smaller units with an investment in plant and machinery up to Rs 50 crore will get a capital incentive up to Rs 7.5 crore and get capital interest subvention at the rate of 6 per cent for maximum seven years. The scheme further seeks to take industrial development to the block level in J&K.. It is anticipated that the scheme will attract major investments and give direct and indirect employment to about 4.5 lakh persons.