Chamber raises business, industrial, banking issues
The Biz Reporter
Srinagar, Jan 7: The Kashmir Chamber of Commerce & Industry (KCCI) made a presentation to the Parliamentary Standing Committee on Industry today, January 7, 2025, in Srinagar. The 31 Member Parliamentary Committee headed by Mr Tiruchi Shiva gathered to address critical issues concerning the MSME, Employment, handicrafts and industrial landscape vis a vis working of the Government and Banks in Jammu & Kashmir.
The KCCI delegation, comprising Senior Vice President Ashiq Hussain Shangloo, Secretary General Faiz Ahmad Bakshi, Past President Mushtaq Ahmad Wani, Tauseef Ahmad Bhat, and Tariq Ahmad Dar, welcomed the committee members and highlighted the chamber’s long-standing commitment to fostering economic development over its 100-year history. A memorandum containing was submitted.
The presentation addressed several urgent concerns, notably the implications of the proposal to increase the Goods and Services Tax (GST) on traditional Kashmiri shawls costing Rs. 10000/- and more from 12% to 28% ; the increase in GST Rates on shawls costing less than Rs. 10000/-The KCCI team reiterated its long-standing demand for a reduction in GST to 5%, criticising the proposed hike as detrimental to the livelihood of artisans who predominantly rely on labour-intensive processes. It was presented that the labour cost / artisan wages involved in the production of shawls amounted to 80% of the cost.
The chairman and Parliamentary Committee members echoed the KCCI’s concerns and committed to conveying this crucial feedback.
Key Points from the Meeting:
Prime Minister’s Employment Guarantee Program (PMEGP):
The KCCI underscored that the region has the highest unemployment rate in the country and emphasised its pivotal role in promoting arts, crafts, and cottage industries. They highlighted the PMEGP’s focus on Khadi and Village Industries, advocating for enhanced support to artisans, particularly women, through timely verification processes by the Khadi and Village Industries Commission (KVIC) for addressing the unemployment problem facing Jammu & Kashmir.
Implementation of NCSS Registration: The challenges faced by new industrial units regarding the registration process under the National Capital Investment Support Scheme (NCSS) were highlighted. The KCCI called for adherence to the “FIRST IN FIRST OUT” (FIFO) protocol, advocating for an increase in NCSS funding from ₹28,400 crores to ₹75,000 crores, with at least 25% reserved for local entrepreneurs to foster self-sustainable economic growth.
Infrastructure Development: The KCCI emphasised that industrial expansion hinges on robust infrastructure, advocating for the development of industrial estates before land allotment. Suggestions included extending the operational timeline for new units from three to five years, expediting NOC and clearance processes, and revising the flawed land allotment ranking policy.
Multiple Industrial Policies: The KCCI expressed concern over the confusion caused by the existence of three overlapping industrial policies, urging a unified approach that builds upon existing frameworks to facilitate ease of business and clarity for entrepreneurs.
Composite Contracts and MSME Support: The KCCI called for mandatory procurement from local MSME registered units under the composite contract system to ensure that government contracts benefit local businesses directly.
Skill Development Initiatives: Recognizing the skills gap in modern industries, the KCCI proposed establishing Skill Development Centers within industrial estates to prepare a skilled workforce that meets the demands of contemporary businesses.
Revival of Sick Units: Highlighting the increasing number of sick industrial units, the KCCI suggested a comprehensive survey and the establishment of a revival corpus to provide support and rehabilitation options for struggling businesses. The Chamber sought approval corpus for revival and rehabilitation of sick Industrial Units. Approve and launch a uniform and non-discriminatory special ONE-TIME SETTLEMENT SCHEME(OTS) through all Banks for J&K MSMEs in a time bound manner.
Access to Finance: Limited access to capital remains a barrier for MSMEs. KCCI advocated for banks to increase lending, particularly under the Credit Guarantee Scheme, and to accept primary mortgages in place of collateral to facilitate business setups.
Sector-Specific Policies: The KCCI called for the formulation of sector-specific industrial policies, recognizing the unique needs of diverse industries such as floriculture, organic farming, and IT, to promote targeted growth strategies.
Identification of Local Products: The KCCI urged the government to identify and reserve products for local manufacturers, advocating for at least a 10-year procurement preference for local industries.
Single Line Activity-Based Estates: The formulation of specialized industrial estates for specific sectors, such as cold chain logistics for the horticulture industry, was also proposed to boost specialized economic activities.
Information Technology Sector Support: The KCCI highlighted the need for improved IT infrastructure, skill development programs, regulatory streamlining, investment incentives, and enhanced cybersecurity measures to foster growth in the IT sector.
In conclusion, the KCCI articulated a clear vision for leveraging Jammu & Kashmir’s unique resources to foster an equitable and prosperous industrial environment, particularly emphasizing the need for balanced and supportive policies that empower local artisans while enhancing economic stability. The committee members listened attentively to these suggestions and have committed to conveying the sentiments expressed by the KCCI.
