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Tax-holiday offer not of much help

Vinod Mathew

AHMEDABAD, June 4

IT is only a day after the historic declaration of a five-year tax holiday for the quake ravaged Kutch by the Prime Minister, Mr A.B. Vajpayee, and already the pundits are asking the most pertinent question -- which industry will benefit from the excise duty exemption till 2006.

As on date, there are not very many takers for the banner as the Kutch district has been known more for its cottage industries rather than any major business barring that of cement and lignite-based power plants.

With the existing cement units already going through a sluggish phase, there is very little prospects of new cement plants being set up in Kutch, though one cannot completely write off the prospects of a rush for intermediary materials aimed at ultimate use in the lignite-based power plants currently under implementation.

However, the people of Kutch seem to be sceptical of large business houses opening new industrial units in this backward district merely to avail themselves of the tax holiday, including the sales tax exemption for a like period as announced by the Gujar at Chief Minister in Bhuj on Sunday.

Significantly, no interest has been shown by the Centre to the pleas made by the two members of Parliament from Kutch and the State Industries Minister, Mr Suresh Mehta, regarding the proposal that a special economic zone (SEZ) be set up on the Kutch coa st.

In fact, barely a month after the earthquake it was proposed that an SEZ in Kutch on the lines of the Jebel Ali Port in Dubai be set up to trigger investments in to the district which is otherwise ignored by the authorities while drawing up blueprints fo r investment proposal to the State.