As the industrial package given to the hill states, including Himachal Pradesh, comes to an end in March, 2010, a controversy has erupted as the chief ministers of the northern states lobby for and against its extension. The BJP government in Himachal Pradesh is pleading for stretching the tax bonanza to the hill states by another 10 years, or at least for three more years as initially planned. The Union Commerce Minister, Mr Anand Sharma, who hails from Himachal, has backed his home state’s demand. This has raised the hackles of the political leaders and industrialists in the neighbouring state of Punjab who are vigorously opposing any further extension of the package.
Originally granted in 2003 by the Atal Bihari Vajpayee government at the Centre for 10 years, the industrial package, which included an income tax exemption for five years and an excise duty holiday for 10 years to industries setting up shop in the hill states of Himachal Pradesh and Uttarakhand, was curtailed to seven years by the subsequent Congress government led by Dr Manmohan Singh. Though the spirit behind the grant of the tax concessions to industries is understandable as the hill states had lagged behind in development, this has unnecessarily vitiated the cordial atmosphere prevailing among the neighbouring states. In fact, states as far as Maharashtra are voicing concerns over this special treatment as industrial units are moving from their existing locations in various states to take advantage of the tax relief.Instead of adopting a discriminatory, state-specific approach to promote industrial development, the Centre should encourage regional cooperation so that states in a particular region pool their resources and make joint efforts for integrated growth. This will also check the duplicity of facilities and wastage of limited resources. The ruling political leaders of the northern states should sink their differences and sit on one platform to forge a joint development strategy.
Source: The Tribune, Chandigarh, India.
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