The Hindu Business Line : TN announces policy for micro, SME sectors

At a glance
The policy aims to sustain an annual growth rate of over 10%.
It offers a range of incentives and support for infrastructure development.
The policy enables 3% back-ended interest subsidy for technology upgradation and modernisation.

M. Vedhan

The Chief Minister, Mr M. Karunanidhi, releases the Micro, Small and Medium Industries Policy, which is being received by the President of Tamil Nadu Small and Tiny Industries Association, Mr A. Shanmuga Velayudam, at the Secretariat in Chennai on Friday. The Rural Industries Minister, Mr Pongalur N. Palanisamy, is also seen in the picture. —

Our Bureau

Chennai, Feb. 22 The Tamil Nadu Government has formulated an exclusive policy for micro, small and medium enterprises sector to encourage agro-based industries and generate over a million jobs in the next five years.

The policy released by the Chief Minister, Mr M. Karunanidhi, aims to sustain an annual growth rate of over 10 per cent for micro, small and medium enterprises. It offers a range of incentives and support for infrastructure development, subsidies for investment in industrially backward areas, capital investment, technology development, marketing support, training and formation of a board for administrative reforms.

The package of incentives in the policy will be available to those units on which work began on or after August 2006, and started commercial production on or after the announcement of the policy.

Focus on Infrastructure

The policy pushes for the formation of multi-storied and flatted industrial estates for micro industries; liberal floor space index in plotted development of 1.5 to 1.75 for industrial sheds and 2.5 for multi-storied industrial units; reservation of up to 20 per cent land area in all industrial estates belonging to the State Industries Promotion Corporation of Tamil Nadu for micro, small and medium enterprises and 30 per cent area for micro industries in SIDCO estates; infrastructure subsidy of 20 per cent for development of private sector industrial estates; and 50 per cent rebate on stamp duty and registration charges for micro and small enterprises in industrial estates and industrially backward areas.

Incentive Schemes

Micro industries set up in any location can avail of a 15 per cent capital subsidy on plant and machinery; 20 per cent power tariff subsidy on low tension power for the first three years; 100 per cent subsidy on the assessed VAT for the first six years and stamp duty exemption on mortgaged and pledged documents.

For micro, small and medium industries in industrially backward areas, a capital subsidy of 15 per cent on plant and machinery; 5 per cent additional employment intensive subsidy for providing jobs to 25 workers for three years; 5 per cent additional capital subsidy for units set up by women; SC/ST physically disabled persons and transgender entrepreneurs subject to maximum of Rs 2 lakh; 25 per cent additional capital subsidy on the value of plant and machinery installed to promote environment friendly technologies and 20 per cent low tension power tariff subsidy for three years from the date of starting production.

Agro-based industries in 385 blocks in the State can avail of the backward area subsidy scheme. The limit of five units in a block and Rs 15-lakh ceiling stipulated under the earlier New Anna Marumalarchi Thittam has been lifted. The subsidy has also been extended to medium industries.

Thrust Sector industries such as electrical and electronic components, leather and leather goods, auto parts and components, drugs and pharmaceuticals, solar energy equipment, gold and diamond jewellery for exports, pollution control equipment, sports goods and accessories, cost effective building materials and readymade garments can avail of a 15 per cent special capital subsidy.

Technology Development

The policy enables 3 per cent back-ended interest subsidy for technology upgradation and modernisation, and 50 per cent subsidy on cost of filing patent application and trademark registration.

It promotes industrial clusters and mini tool rooms under public-private partnership mode, creates a technology development fund for cleaner, energy efficient and IT enabled technologies. It offers assistance for creating centres of excellence and technology business incubators for introduction of new production techniques and design development.

Marketing Support

It offers 15 per cent price preference for micro and small industries under the Tamil Nadu Transparency in Tenders Act, 1998, purchase preference for notifies items, waiver of earnest money deposit for tenders and 50 per cent grant on hall rent for participating in exhibitions and support for marketing under a common banner or brand.

The policy also envisages deregulation and simplification of procedures including introduction of a common application form and self-certification for statutory clearances and a legislation for industrial single window clearance.

The State Government also plans to extend policy support for rehabilitation of sick micro, small and medium enterprises and creation of an export policy for the sector.

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