Yojana Magazine (September 2022): New Industrial Policy For J&K

Yojana Magazine is a very important and indispensable source for UPSC Civil Services Exam Preparation. Here, we come with ”Analysis Of Yojana Magazine” which covers the monthly Yojana Magazine keeping in mind the demand of UPSC, particularly from the topics of important government schemes.

In ‘‘Analysis Of Yojana Magazine,” we cover each and every topic of the Yojana edition of a particular month and provide an easy-to-understand gist.

This topic-wise analysis is prepared from the Septeber 2022 edition of the monthly Yojana Magazine.

New Industrial Policy For J&K: Introduction

• Three years ago, the Indian Parliament decided to offload the past that was holding back the 1.3 crore citizens of Jammu and Kashmir from realising their potential.
• Since then, J&K has travelled quite a distance to re-arrange priorities of development, initiate deep reforms in governance, curb corruption, neutralise a well-fed terror ecosystem and realise the dreams of youth.
• In the last 70 years, only Rs15,000 crore private investment was realised in J&K whereas in the last two years, the UT attracted proposals worth Rs 56,000 crore.

New Industrial Policy For J&K: What has changed infrastructure-wise since the abrogation of Article 370?

• In 2018-19, only 9,229 projects were completed in a year. This has increased to 50,627 in the financial year 2021-22.
• Rs 1 lakh crore is being spent to improve road connectivity and build tunnels.
• Jammu and Kashmir is trying to scale up infrastructure. Projects worth Rs 58,477 crore under the Prime Minister’s Development Package have picked up pace and direction.
• Fifty new degree colleges have been established increasing the number of seats by 25,000.
• Big ticket infrastructure projects have come in the healthcare sector. Two new AIIMS, seven new medical colleges, two cancer institutes and 15 nursing colleges have been added and 140 health institutions are being upgraded.
• An additional 41,141 km of roads have been constructed. J&K is placed 4th in the ranking of states and UTs based on their performance in the Pradhan Mantri Gram Sadak Yojana.
• Social sector spending has increased by 43.83 per cent and the economic sector by 45.60 per cent in the last three years. It shows the importance the Centre has attached to the overall development of Jammu and Kashmir.

New Industrial Policy For J&K: What is New Industrial Policy For J&K?

• The Government of India has notified the New Central Sector Scheme for Industrial Development of Union Territory of Jammu & Kashmir (J&K) on 19/02/2021 to attract capital investments in J&K with a financial outlay of Rs 28,400 crore (Upto the year 2037).
• The Scheme provides four types of incentives namely (i) Capital Investment Incentive, (ii) Capital Interest Subvention, (iii) Goods & Services Tax Linked Incentive and (iv) Working Capital Interest Subvention.
• The Government of Jammu & Kashmir has received proposals for investments worth approximately Rs.51,000 crore so far.
• Moreover, in order to boost industrial development in UT, the Government of J&K has also notified the J&K Industrial Policy, J&K Private Industrial Estate Development Policy and J&K Industrial Land Allotment Policy.

New Industrial Policy For J&K: Jammu and Kashmir Investment Policy 2021-30

• Government of India has formulated New Industrial Development Scheme for Jammu & Kashmir (J&K IDS, 2021) as Central Sector Scheme for the development of Industries in the UT of Jammu & Kashmir.
• The main purpose of the scheme is to generate employment which directly leads to the socio economic development of the area. Considering the historic development of reorganization of Jammu & Kashmir with effect from 31.10.2019 into UT of Jammu & Kashmir under the J&K Reorganisation Act, 2019, the present scheme is being implemented with the vision that industry and service led development of J&K needs to be given a fresh thrust with emphasis on job creation, skill development and sustainable development by attracting new investment and nurturing the existing ones.
• The following incentives would be available under the scheme:

1. 1. Capital Investment Incentive at the rate of 30% in Zone A and 50% in Zone B on investment made in Plant & Machinery (in manufacturing) or construction of building and other durable physical assets(in service sector) is available. 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 & Zone B respectively
   2. Capital Interest subvention: At the annual rate of 6% for maximum 7 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 service sector).
   3. GST Linked Incentive: 300% 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 incentive.
   4. Working Capital Interest Incentive: All existing units at the annual rate of 5% for maximum 5 years. Maximum limit of incentive is Rs 1 crore.

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