JAMMU: Underscoring the fact that Jammu and Kashmir (J&K) has not been able to attract even half a per cent of the total live investments made by both government and private sectors across India, apex industry body ASSOCHAM has suggested an annual special package of Rs 10,000 crore per year for five years from the central government to give boost to the small and medium enterprises (SMEs) in the state. It has demanded the spcial package for boosting food processing, horticulture, tourism and hospitality, IT/ITeS (information technology enabled services), BPO (business process outsourcing) and other potential industries.
Constant flow of private investments and large industries is imperative to bring about sustainable growth, development, jobs and the long-lasting peace in the valley state, said D.S. Rawat, national secretary general of The Associated Chambers of Commerce and Industry of India (ASSOCHAM) while jointly releasing the chamber paper along with Babu Lal Jain, chairman, Entrepreneur Development Council at a press conference held in Jammu today.
J&K has attracted live investments worth just over Rs one lakh crore out of the total live investments worth over Rs 140 lakh crore in India as of December 2012, according to a strategy paper titled Special Assistance for Development in J&K, prepared by the ASSOCHAM Research Bureau.
Government is the major investment source in J&K evidently as 1.3 per cent of the total investments made by the central government across states were put in J&K while the state attracted a meagre 0.3 per cent of the total investments made across India by the private sources.
Out of the total 7,109 live investment projects worth about Rs 58 lakh crore from all government sources across India, J&K attracted 187 projects worth over Rs one lakh crore and of the total 9,950 live investment projects worth about Rs 83 lakh crore from private sector, J&K attracted 28 projects worth just over Rs 27,600 crore, according to the ASSOCHAM paper. While the frontline states in India are competing to attract domestic and foreign investors, J&K on the other hand could not attract any foreign investment as of the aforesaid period.
While analysing the growth scenario of J&Ks peer hilly states of Uttarakhand and Himachal Pradesh, it was observed that state economy of J&K grew at the lowest growth rate of just over six per cent between 2004-05 and 2011-12 as against over 12 per cent in Uttarakhand and over eight per cent in Himachal Pradesh. India as a whole clocked a growth rate of over eight per cent during the same period, according to the ASSOCHAM paper.
The unfriendly investment climate in industrially backward J&K portrays the inhibitions of the private sector because of low supply and demand linkages apart from security and geographic concerns, said Rawat. Locational disadvantage owing to hostile terrain and climatic conditions are certain major problems as main consumption markets of the country are way too far from the production centres in J&K.
In its paper, ASSOCHAM has stressed upon the need to improve the socio-economic infrastructure, physical infrastructure such as roads, power, telecommunications and others. There is also an urgent need for the state government to formulate policies, prepare a strategy and create a policy framework that shall encourage industries with potential to earn foreign exchange and generate huge employment.
Besides, there is also a need to develop basic infrastructure like proper road, rail connectivity, electricity and upgrading the skills of traditional craftsmen.
The apex chamber has also made a request to the central government to announce budgetary support to J&K in forthcoming central budget as the same would spur job opportunities thereby inducing a productive ambience in the valley. kns
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