The trade and industry has hailed Maharashtra government for announcing a new five-year industrial policy (2019-24) for the state. The new policy commencing April 1, 2019, aims to attract investments of over Rs 10 lakh crore and create around 40 lakh jobs by 2023-24. The objective of the policy is to create a conducive business environment while promoting micro, small and medium enterprises (MSMEs) through public funding, fiscal incentives, cluster promotions and institutional support. The state is looking to attain a manufacturing sector growth rate of 12-13% going forward. The policy will contribute towards making Maharashtra a US$ 1 trillion economy by 2025.
Apart from defence and aerospace, bio-tech, medical equipment, information technology and electric vehicles, textile machinery is one of the thrust areas of the policy. The policy also offers incentives for futuristic technologies like Industries 4.0 and startups. Experts are of the view that Maharashtra is one of the major states for textile production and now the emphasis on textile machinery, considered one of the weak links of the industry, will further strengthen Maharashtra’s position in the country’s textile production.
“Textile has been one of the major industries in the state. Any effort to boost this sector through a policy framework is a welcome move. In order to support the industry, we need a robust base for machinery manufacturing, which, however, had failed to draw the attention of policy makers in the past,” says D K Nair, the former secretary general of CITI. “The policy will not only promote large projects but help develop the MSME business in the state in a big way. Policy aims at hand holding 20,000 MSMEs in their business growth and development,” states P Anbalagan, CEO, Maharashtra Industrial Development Corporation (MIDC).
MSMEs are the backbone of the state’s economy as the sector generates 32 jobs per crore investment, which is 10 times more than that of mega projects. MSMEs contribute to more than 80% of the total employment. Therefore, the government proposes 5% subsidy on capital equipment for technology upgradation subject to maximum of Rs 25 lakh for new MSMEs and their expansion, 75% subsidy on expenses incurred on quality certification limited to Rs 2 lakh. The government will provide 25% subsidy on capital equipment for cleaner production measures limited to Rs 5 lakh.
Besides these, MSMEs will be offered incentives for credit rating, wherein 75% of the cost will be provided and they will also be eligible for 75% of cost of water auditing limited to Rs 2 lakh and 75% cost of energy auditing limited to Rs 4 lakh. Under the Maharashtra State Industrial Cluster Development Programme, MSMEs will get subsidy up to Rs 10 crore; about 116 projects have been identified across sectors.
The state government, in joint cooperation with world acclaimed institutes such as Harvard and Cornell, will establish a Centre of Excellence for the MSME sector.
Under the new policy, large, mega, and ultra mega projects will be provided graded incentives to encourage an early realisation as well as dispersal of investments, especially in the underdeveloped and backward areas.
Furthermore, the government, to promote employment generation, will launch the new Employment Generation Programme. The promoters of mega and ultra mega industrial projects with investment of Rs 4,000 crore will be eligible for 50% reimbursement of employers’ contribution towards Employees’ Provident Fund (EPF) and Employees’ State Insurance (ESI).
The government, in a bid to improve infrastructure in the industrial estates run by MIDC and also other industrial areas, will create a corpus of Rs 1,000 crore with the contribution of Rs 500 crore each from the government and MIDC.