The Hindu Business Line : Industry body urges VSP to allot space for ancillary park

THE Federation of Andhra Pradesh Industries (FAPI) has asked the Visakhapatnam Steel Plant authorities to encourage ancillary units and downstream industries by allocating site within the plant for a park.

At a press meet here on Tuesday, Mr B.V. Rama Rao, president of FAPI, said that not many ancillaries and downstream units had come up in the vicinity of Visakhapatnam. Whereas, there were as many as 200-300 units based on other steel plants, only 36 units had come up here.

He said the FAPI and the local units had taken up this matter to the notice of the Union Steel Minister, Mr Ram Vilas Paswan, and sought allocation of 500 acres within the plant for setting up of an ancillary park. The Minister had promised to consider it, he said.

Mr Rao said that FAPI also wanted the appointment of an eligible bureaucrat or technocrat hailing from the State as the Chairman and Managing Director (CMD) of the plant after the superannuation of the present CMD, Mr B.K. Panda, by the month-end.

Mr Rao also said the units in the Visakhapatnam special economic zone (VSEZ) were facing great difficulties because of the erroneous policies of the Government and entrepreneurs were not coming forward to set up units.

Narrating the woes of entrepreneurs in the VSEZ, Mr N.R Sagi, Managing Director of Coromandel Expopack Private Ltd, said that the Government had converted the Visakhapatnam export processing zone into a special economic zone (SEZ) with good intentions, but it had given rise to certain tax anomalies, causing great hardship to the units.

``We are a packaging unit, the first one in fact, to have been established in the VEPZ and the Government had allowed us certain duty concessions. The unit was set up with roughly an investment of Rs 1 crore. We were allowed to sell 50 per cent of our production to EOUs outside the zone and the sales were considered deemed exports and exempted from payment of duty,'' he said.

Subsequently, after the conversion of VEPZ into VSEZ, this facility had been withdrawn and in fact notices had been slapped on the unit by customs authorities, he added.

"We have pointed out to the authorities the anomalies involved several times, but to no avail. The units in the VSEZ can survive only if the supplies to the local merchant exporters are considered deemed exports and exempted from duty,'' he said and added that his unit had become sick because of the Government policies.

Mr Rao said the Union Government should impose a uniform eight per cent excise duty on small units and raise the investment limit from Rs 1 crore to Rs 5 crore to enable the SSIs to survive in the present competitive environment.

More Stories on : SSI | Industry Associations | Andhra Pradesh | Steel

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