Characteristic of any developed region is the delicate balance between the manufacturing, service and agricultural sectors. J&K UT’s industrial landscape is dominated by MSMEs as they contribute approximately 8% to the GSDP and employ the largest number of people in the service and manufacturing sectors. Around 25,000 MSMEs are operational in UT, employing around 90% of the industrial workforce here.
In this context, the Jammu and Kashmir Industrial Policy (JKIP)-2021-30 is a welcome change from previous industrial policies. Combined with the incentives offered under the “New Central Scheme for Industrial Development of Jammu and Kashmir” notified by the Department of Promotion of Industry and Internal Trade (DPIIT) of the Government of India in 2021, the J&K’s industrial ecosystem is expected to experience a paradigm shift.
The new policy is different from the industrial policies that were in effect before this policy. Ex-State JK waivers had adopted industrial policies from time to time (i.e. 1995, 1998 and 2004), the latest being Industrial Policy, 2016. To support the old industrial policies, the government Indian sanctioned formerly state industrial development incentive packages at different intervals, namely Central Capital Investment Scheme, 2002, 2012; Budget Support Program under Goods and Services Tax Scheme and JKIDS 2018, but Kashmir’s industrial sector has failed to compete with other parts of the country.
According to the new industrial policy, which came into effect on April 1, all industrial units entering commercial production as well as existing units undertaking substantial expansion, will be eligible for incentives under the policy.
The new policy has an expenditure of Rs 28,400 crore (Rs 284 billion), the biggest incentive yet, on the industrial development of Jammu and Kashmir for the next 15 years. It is expected to generate investment of Rs 20,000 crore (Rs 200 billion) and employment of 4.5 lakh over the period of the plan.
This is the first block-level development project that aims to undertake the process of industrialization at the very local level using local resources, skills and talents available at the national level.
The policy specifically promises an era of socio-economic development in the region, fulfilling the aspirations of the people of Jammu and Kashmir. The policy aimed to prioritize the aspirations of entrepreneurs while making concerted efforts to make Jammu and Kashmir the most investor-friendly union territory. It also encourages and facilitates people who want to join the industrial sector wagon in Jammu and Kashmir.
The policy specifically promises an era of socio-economic development in the region, fulfilling the aspirations of the people of Jammu and Kashmir. This change aims to ensure the transformation of J&K from an “aspirational” region to an “industrially advanced” region. The policy aims to stimulate industrial growth in an environment of stability in which dynamic competition is allowed for the improvement of traditional basic sectors such as agriculture and related sectors, food processing, tourism, health, pharmaceuticals, etc.
To promote the ease of doing business at J&K, the “one-stop-shop approach” of the new industrial policy is envisaged to streamline the government’s role as “facilitator, partner, supplier, collaborator and promoter”. With ease of doing business, building a land bank and managing MSMEs, J&K is poised to position itself as a lucrative investment destination in India over the next 10 years.
The new policy also defines various intervention themes in the field of training in ITI, collaboration between industry and academia and to encourage investment in capacity building by providing adequate financial support. The proposed Entrepreneur and Skills Development Fund is expected to be a game changer. The policy aims for “minimum regulation and maximum facilitation” keeping in mind UT’s unique geographic location and environmental dynamics. Environmental protection forms the basis of the new policy and is therefore consistent with the idea of “sustainable development”. The new policy aims to promote new industries in J&K UT in the areas of IT, healthcare and pharmaceuticals, agriculture and food processing, education, and business development. skills, etc At the same time, she also lays out a holistic plan for reviving sick units. with adequate regulatory support and financial incentives. “Zero Effect-Zero Defect” productivity is quite achievable given the new industrial policy.
In short, it is evident that the potential of the new industrial policy in terms of job creation, promotion of innovation and entrepreneurship, balanced development of all regions of J&K and improvement quality of life is ready to be realized with the cluster-based approach and the optimal realization of resources.
“Tradition, Growth and Transformation” – the slogan of the new industrial policy is poised to herald a new era of growth and prosperity for UT Jammu and Kashmir.