By IANS,
Chandigarh/New Delhi: Punjab Friday asked the central government to either give the state a package for industrial investment or withdraw similar incentives to neighbouring hill states of Himachal Pradesh, Uttarakhand and Jammu and Kashmir.
Chief Minister Parkash Singh Badal Friday met Prime Minister Manmohan Singh in New Delhi to seek the latter’s intervention “personally and effectively” to ensure that Punjab’s economy and its industry were not made hostage to the union government’s proposed decision to extend industrial concessions to the three hill states.
The central government has initiated a move to extend the tax concession for industrial investment in the three hill states till 2013. The existing package, given in 2003, ends March 31 this year.
Badal presented a detailed case on behalf of the state saying that the continued concessions to hill states had already robbed Punjab of major growth potential and had delivered a crippling blow to its industry.
“Because of these concessions, industrialists in Punjab were not able to compete with their counterparts from states which enjoyed the package. Not only had there been virtually no new investment in Punjab because of the discriminatory application of concessions, but there has been an alarming flight of capital from the state, resulting in major set back to industrial growth,” Badal pointed out.
The chief minister pointed out nearly 274 industrial units of Punjab had already either shifted or set up their expansion units with investment of about Rs.3,674 crore in the neighbouring states to avail extra tax concessions in these states.
Badal pointed out that there had been considerable decline in the central excise collection in Punjab which had gone down from Rs.1,896.99 crore in 2004-05 to Rs.867.17 crore in the 2006-07. This trend also created the spectre of an alarming unemployment in the state, he added.
Assuring a positive response, the prime minister told Badal that the central government would look into these issues.
Badal also sought a relief package of Rs.1,420 crore from the government as compensation for the extra-ordinary measures taken by the Punjab State Electricity Board, which had to divert 3,500 million units from other sectors to the farm sector during the kharif (paddy sowing) season to fight drought.
“Punjab was the only state which had battled drought to such an extent that it has not only maintained the production at the previous year’s level but had in fact broken all records raising paddy production to 168 lakh tonnes against a bumper season of 151 lakh tonnes last year,” Badal said.