The Cabinet Committee on Economic Affairs has recently green-lighted the Department for Promotion of Industry and Internal Trade’s (DPIIT) proposal for the Central Sector Scheme. Positioned under the Ministry of Commerce and Industry, DPIIT’s proposed scheme aims to catalyze the industrial development of the Union Territory (UT) of Jammu and Kashmir (J&K).
Exploring the Central Sector Schemes
Central Sector Schemes are entirely funded by the Central government and are executed by the Central Government machinery. These are predominantly formulated on the subjects reflected by the Union List.
Objectives and Beneficiaries of the Scheme
The primary objective of the current scheme is to take industrial development to the block level within the UT of J&K. This initiative is a first of its kind in any Industrial Incentive Scheme by the Government of India. It aims to promote sustained and balanced industrial growth across the UT. The scheme has been designed to attract both smaller and larger industrial units.
Financial Layout and Expenditure
The financial layout for the scheme stands at Rs. 28,400 crore for the period ranging from 2020-21 to 2036-37 (17 years).
Role of J&K in Implementation
The scheme calls for a greater role from the UT of J&K concerning registration and implementation. This would be achieved while maintaining appropriate checks and balances through an independent audit agency responsible for approving the claims.
Incentives Under the Scheme
The scheme offers several incentives, such as Capital Investment Incentive and Capital Interest subvention. For instance, Capital Investment Incentive provides an incentive rate of 30% in Zone-A and 50% in Zone-B on the investments made in plant and machinery or construction of building and other durable physical assets.
Working Capital Interest Incentive
Existing units will be provided an incentive at the annual rate of 5% for a maximum duration of 5 years. The maximum limit for this incentive is Rs. 1 crore.
Significance of the Scheme
The scheme nurtures existing industries while encouraging new investments and substantial expansion within the UT. It also aims to provide employment to around 4.5 lakh people, which would lead to equitable, balanced, and sustainable socio-economic development of the region.
Other Initiated Schemes
In addition to the Central Sector Scheme, other initiatives such as the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana and Deendayal Antyodaya Yojana-National Rural Livelihood Mission have also been launched. These schemes are directed towards extending health insurance coverage to all J&K residents and providing a special package worth Rs. 520 crore in the Union Territories of J&K and Ladakh over five years respectively. Furthermore, services that were previously suspended following the revocation of Jammu and Kashmir’s special status were partially restored with internet speed limited to 2G.
