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Thursday, May 02, 2002

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Vajpayee extends Rs 150-cr relief package to Gujarat

Vinod Mathew


THE one fallout of the censure motion on Gujarat that was defeated in the Lok Sabha in the early hours of May Day was the declaration of Rs 150-crore rehabilitation package for Gujarat by the Prime Minister, Mr A.B. Vajpayee. By sanctioning Rs 150 crore, the Centre has gone beyond the expectations of the State Government, which had kept Rs 150 crore as the maximum mark-up as reported in Business Line on April 9.

The State Government, which had allocated Rs 60 crore in early April towards rescue and rehabilitation efforts, was at best looking at a Central assistance of anywhere between Rs 50 crore and Rs 75 crore, according to sources in the Industries Department. As the amount has now been generously pegged at Rs 150 crore, the State Government will have no more excuses to offer on the allegedly tardy disbursement of cash compensation under various heads.

The rehabilitation package announced by the Industries Department in mid-March for the riot-hit tiny and small business units included a four per cent interest subsidy from the side of the State Government, the upper ceiling being Rs 1 lakh, for any loans taken from banks and FIs. The State Government subsidy was for a three-year period.

For the myriad state-run industrial interface bodies such as the Gujarat Industrial Investment Corporation (GIIC), the Gujarat State Finance Corporation (GSFC) and the Gujarat Industries Development Corporation (GIDC), the directive was that they treat all affected units as deemed sick units and give them the benefit of loan rescheduling.

This, provided none of the claimants resorted to retrenchment of employees. The affected units were also to be eligible for interest-free sales tax deferment for a period of five years. There was also to be a deferment on electricity duty for one year.

The State Government's initial survey on damages had put the loss to industry at Rs 55 crore and the total loss, including some Rs 165 crore in insurance claims, at marginally over Rs 200 crore. With the State Industries Department's two-month time cap on surveys set to end on May 15, there are doubts being raised as to whether there could be any match with industry generated figures that put total damage at over Rs 2,500 crore, though the latter includes deemed loss from business not transacted.

Ad gaffe: Meanwhile, the Gujarat Government, which had been running a virtual advertisement campaign to `counter the negative media coverage in the national press', came a cropper on May 1, the State founding day. The gaffe came in Wednesday's advertisement, which displayed quotes of Mahatma Gandhi, Sardar Vallabhbhai Patel, Shri Ravishankar Maharaj and the Chief Minister, Mr Narendra Modi.

The leaders of yore, both Sardar Patel and Ravishankar Maharaj, escape unscathed. The persona crucified was the Mahatma who has been credited with having said, "Violence is not a shield to hide cowardice, it is the greatest asset of the brave." Mr Modi's statement that concluded the bevy of quotations said, "Trust is the mother of peace.....Peace is our collective responsibility."

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