Solan: Decrease in industrial investment due to lack of incentives

Himachal Pradesh: Due to lack of financial incentives in the state to attract industrial investment, only two units have been set up in the last three years in the 20 industrial areas created across the state. The two units have employed 431 people, including 372 Himachalis and 59 non-Himachalis. One unit has been set up under the centrally sponsored product-linked incentive (PLI) scheme. It has been given 100 per cent rebate on power duty for five years, 15 per cent rebate on energy duty for five years, 100 per cent rebate on stamp duty and registration fee, besides subsidised land at the rate of Rs 1 per square metre. With no such incentives now available to the state’s industries, new investments have dropped significantly despite expansion plans at existing industries. Stamp duty has been doubled, while power duty and electricity charges are the highest in the region, keeping investors away.

A total of 189 plots were constructed in 20 industrial areas in the state in the last three years. Infrastructure work is underway on 149 plots, while land development and construction of buildings is underway on 38 plots. Industrial units have been set up on only two of these industrial plots. Kinvin Private Limited, an industrial unit manufacturing Active Pharmaceutical Ingredients (APIs), the raw material for pharmaceutical units, has been set up in the newly created industrial area at Plasra in Nalagarh. It has employed 309 people, including 252 Himachalis and 57 non-Himachalis. This is India’s first API fermentation unit. Being a key API used in the production of several antibiotics, it will meet about 60 per cent of the domestic market demand. India is heavily dependent on countries like China and Korea for this API requirement.
This unit will produce 400 tonnes of Potassium Clavulanate API annually. Its domestic demand is estimated at 700 tonnes per annum. The unit is being set up under the centrally funded Production Linked Incentive (PLI) scheme. The scheme was launched a few years ago to promote domestic manufacturing of critical key starting materials (KSMs)/drug intermediates and APIs in the country. Another unit has been set up at Chanaur in Kangra district, where 122 people have got employment, including 120 Himachalis and two non-Himachalis. Facing acute cash crunch, the state industries department’s attempt to provide ready industrial plots equipped with basic amenities like roads, electricity, sanitation etc. failed while it was trying to create a land bank in the state.