Srinagar: The Federation Chamber of Industries Kashmir (FCIK), the apex industry representative body of Kashmir, has urged upon the government “to look inwards for saving the remnants of local industry from extinction before wooing the investors from outside to venture into the sector.”
In its 2nd Executive Council meeting of the current term the FCIK members expressed their shock and anguish over the dilapidated status of local industry for the reasons of “unfavorable conditions, bureaucratic callousness and breach of trust and confidence.”
They regretted that “while the entire government looked busy in paving the way for accommodating invisible investors from outside in the sector, they completely ignore that the investment of thousands of crores locked up in local enterprises was in distress and only a few steps away from extinction.”
The members expressed their dismay over the ‘unheeding attitude of authorities towards mitigation of the problems of enterprises which have triggered to newer complexities after back to back twin lockdowns since August 2019’. They said that no ‘adequate steps were being taken to boost demand for local products which was much required to restart the smooth operations of units.’
“On the contrary, the government has inadvertently restricted its own departments from procuring their required goods from the local industry in absolute violation of the industrial policy in vogue which provided for procurement of such goods through SICOP”, they said.
“While passing on the instructions to indenting departments for procurement of their requirements through GEM portal, the government forgot to realise that hardly any local enterprise was registered with the portal and that it was next to impossible for local enterprises functioning in most disadvantageous conditions as that of ours to compete with enterprises of high industrialised zones in different states”, regretted the members.
The members observed that as a result of change in the current procurement policy, the departments have procured industrial goods worth hundreds of crores from the outside enterprises leaving the locals jobless.
The FCIK members also conveyed their concern over the unprecedented delay in release of due payments by various departments in favour of supplying units. They said that despite assurances these payments continued to be withheld for month’s even years causing tremendous losses to the enterprises.
While debating over the package for revival of businesses in J&K announced by the Lt. Governor in September, the members observed that the said package had not served any useful purpose to the entrepreneurs so far because the money released by the government had directly gone to the banks towards part of accumulated interest on the loans that too in respect of standard accounts of enterprises only.
“Despite the part remittances of interest by the government, these standard accounts accumulated with remaining and current interest liabilities were likely to turn NPAs sooner or later because of their inability to serve their debt for various other problems which have hampered their smooth re-operationalisation”, the members observed.
The members said that while the LG’s package provided for constitution of a committee comprising government officials with representatives from banks and industry to deal with restructuring and one-time settlement of stressful accounts and non-performing assets, the concerned enterprises have completely been left at the mercy of respective banks. Not only that, the said committee was yet to be constituted, but on the contrary the banks have been armed with additional support to enforce SARFAESI Act, regretted the members.
The members also observed that many other demands like amnesty for VAT regime, provident fund contributions and other announcements made in the LG’s package were yet to be implemented.