The Hindu Business Line : CM hopeful of industries gearing up to overcome crisis

The Andhra Pradesh Chief Minister, Dr Y.S. Rajasekhara Reddy, giving away outstanding woman entrepreneur award to Ms Usharani Manne, Director, Polmon Instruments Private Ltd, during the 90th annual FAPCCI awards function in Hyderabad on Thursday.

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Hyderabad, Dec. 4 The Andhra Pradesh Chief Minister, Dr Y.S. Rajasekhara Reddy, hoped that the industrial associations in the State will gear up to the occasion and beat the current economic slowdown.

“Economic slowdown is a reality that every one of us facing but in spite of the slowdown we have to grow. I am quite sure the industrialists and industrial associations will gear up to the occasion,” he said while addressing industrialists at the annual awards function of the Federation of Andhra Pradesh Chambers of Commerce and Industry here on Thursday.

He added that every possible measure such as improving technology, improving quality and reducing costs have to be undertaken by industry to beat the slowdown in economy.

The Chief Minister said the Government is contemplating coming out with huge packages, especially on the infrastructure projects.

“We are also in the process of making an amendment to the Fiscal Responsibility and Budget Management (FRBM) Act where in we are seeking around Rs 6,000 crore, which we could have drawn in the last three years but did not do because of our finances being good. So we are in the process of amending the Act and are seeking the Central Government’s permission to allow us to borrow this additional money as an additional fiscal deficit which will be only used on infrastructural expenditure like irrigation projects and roads,” Dr Reddy said.

He hoped that this move will have a good impact again on the economy. He also took the opportunity to impress upon the industry not to worry about the economic recession and that the Government is there, both at the State and Centre, to beat the recession.

Earlier, Mr Suraj Prasad Agarwal, President, FAPCCI, said that there was an urgent need to jump start the economy and reverse the downward trend. “Massive infrastructure investments are necessary not only to protect the jobs, but also to create new jobs,” he said.

Mr Agarwal also suggested that the State Government must invest in laying of new roads all over the State and to take up construction of 10 lakh low-cost houses (one and two-bed room houses) under the PPP model starting from Rs 3 lakh onwards.

“The PPP model will relieve the Government from financing scheme and FAPCCI is ready to take the responsibility to design the model,” he said.

The industry body has also recommended cutting down the Cenvat from 14 per cent to 10 per cent, reduction of service tax from 12 per cent to 10 per cent and reduction in general VAT by 12.5 per cent to 10 per cent.

“Many small and medium units are either becoming sick or running into losses. The above recommendations will increase tax collections and also protect job losses,” Mr Agarwal said.