Karnataka unveils new industrial policy

Bangalore, Aug 29 (IANS) Karnataka Tuesday unveiled a new industrial policy that aims at 9-10 percent growth in the state's economy over the next five years.

Tuesday, August 29, 2006 | 10:11:49 PM IST (+05:30 GMT)
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Bangalore, Aug 29 (IANS) Karnataka Tuesday unveiled a new industrial policy that aims at 9-10 percent growth in the state's economy over the next five years.

Karnataka had achieved an 8.7 percent growth in the gross state domestic product (GSDP) during last fiscal (2005-06).

Releasing the policy here, Deputy Chief Minister Y.S. Yediyurappa told reporters that the government would offer incentives to attract investments in small and medium industries too.

'The thrust of the policy will be on strengthening the manufacturing sector and increasing the state's share in national exports to 20 percent from the current 15 percent. We have set a target of one million jobs by 2011 through sustained and growth-oriented industrialisation,' he said.

In a bid to encourage investors to set up their industries in backward areas, the policy has classified the 176 taluks or sub-districts into three zones. The first zone consists of 76 most backward taluks while the second zone covers 85 backward taluks. In the third zone, industrially developed taluks have been earmarked.

'Capital investment subsidy up to 25 percent will be granted to small-scale industries (SSIs) and tiny industries in the first zone and 20 percent in the second zone.

'Similarly, all industries will be eligible for a 100 percent exemption on stamp duty in zone 1 and 75 percent in zone 2,' Industries Minister Katta Subrahmanya Naidu pointed out.

To facilitate effluent treatment plants in all zones, a one-time capital subsidy up to 50 percent of the cost (with a ceiling of Rs.10 million per unit) will be provided. Entry tax and special entry tax will be exempted for three years in the first zones for capital goods.

The exemption period for procurement of raw materials for the two zones is five years, according to the policy, which will be in force retrospectively from April 1, 2006 to March 31, 2011.

Concessions for investments in the IT and biotech industries will continue as per the respective sectoral policies, Naidu stated.

Copyright : Indo-Asian News Service
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