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Ambarish Mukherjee

Planning Commission to decide parameters for backward districts

Mr Ashwani Kumar

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New Delhi, Feb. 25 Relocation of major industries from urban areas to industrially backward districts is likely to get fresh incentives since the Government is preparing for relocation in order to free urban space.

As a prelude to working out the incentive package, the Minister of State for Industries, Mr Ashwani Kumar, has directed the Planning Commission to evolve a comprehensive definition of industrially backward districts.

"At present there is no clear comprehensive, scientifically verifiable definition of industrially backward districts. The job will have to be done by the Planning Commission since they have all the NSSO data," Mr Kumar told Business Line.

"Only once, in the early 90s, was a survey regarding industrially backward districts carried out. It was done for the purpose of income-tax concessions under the IT Act. But the situation is very much different now and it is imperative to start anew," he added.

Elaborating on the advantages of relocation of industries, Mr Kumar said that this would generate huge employment in rural and semi-urban areas in the form of blue-collar jobs through an increase in manufacturing and productive enterprises and a balanced geographic spread of economic activities.

The advantages include getting more space for the industries, enabling the creation of better-integrated clusters. Relocating industries would also help in modernisation of equipment and facilities, the Minister said.

Such relocation would require suitable incentives to industry. Mr Kumar said: "I have already written to the Finance Minister explaining the need for a set of credible proposals that would facilitate a shift of major industrial activities away from the metros to rural areas."

The Minister has also explained to the Finance Minister how relocation of industries would help them move closer to large segments of their market and establish presence in new markets, along with resultant savings in time and money.

Relocation would also help industries to get closer to certain suppliers and in many cases to their relevant natural resources, he added in the communication.

A meeting between the Industry Ministry and the Planning Commission is likely to take place soon to deliberate further on the issue.

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