Press Information Bureau

Government of India

Ministry of Commerce & Industry

21-February-2012 18:00 IST

Anand Sharma holds Consultation on Transport Subsidy Scheme

The Union Minister of Commerce, Industry and Textiles, Shri Anand Sharma held the consultations with states of North Eastern region and special category states of Jammu and Kashmir, Uttrakhand, Himachal Pradesh, West Bengal and UT of Andaman Nicobar Island and Lakshdweep on review of Transport Subsidy Scheme (TSS), North East Investment Promotion Programme and Special Packages and textiles here today. The Meeting was attended by the Chief Minister of Meghalaya Shri Mukul Sangama and the industry Ministers and senior officials of the states under the purview of the schemes.

The Transport Subsidy Scheme was introduced way back in the early 70s to offset the high transportation cost because of poor infrastructure and geographical inaccessibility in these States. “We are now in the process of revamping the Scheme and in doing so, we had undertaken a detailed study of the operation of the Scheme over the last several years and the matter will be referred to the Cabinet, incorporating all your suggestions, for a final view.” The Meeting discussed the proposed definition of ‘Manufacturing’, amendment to the negative list of TSS, expansion of existing list of designated railheads. The views of states were also obtained on the issues of cap on value of transported goods, linkages between transport subsidy and employment generation. The meeting also explored the ways of incentivizing transportation of raw material/finished goods by inland water transport and Additional incentives to MSME sector.

Under the Special Package provided to these States, Central Government have been providing subsidy of 15% to 30% on plant and machinery as capital investment subsidy. Apart from this, the government has been providing working capital loans for a period upto 10 years from the date of commencement of commercial production and reimbursement of 100% insurance premium. “For the Special Category States of Himachal Pradesh, J&K and Uttrakhand, over 46,000 industrial units have either been set up or are in the pipeline with a total investment of over Rs. 37,400 crores. These are estimated to provide gainful employment to over 4.84 lakh people” added the Minister.

North East Industrial and Investment Promotion Policy (NEIIPP), 2007 has seen registration of over 880 units with investment intentions of over Rs. 9.29 lakhs to provide gainful employment to over 34,000 persons.

Shri Sharma emphasized “I believe that the time has now come to give a focused and integrated thrust to the development of North Eastern Region. While provision of subsidy will remain an important element in catalyzing industrial development, equally important will be a thrust on infrastructure development within the region and linkages with the rest of the country.” Under the ASIDE Scheme, Department of Commerce has allocated Rs. 55.28 crores for the North Eastern Region and Rs. 14.93 crores for Himachal Pradesh, J&K and Uttrakhand for 2011-12.

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DS/gk

Transport Subsidy Scheme review seeks to redefine manufacturing, amend eligibility, and incentivize inland water transport and MSMEs. Consultations addressed revamping the Transport Subsidy Scheme with proposed changes to the definition of manufacturing, amendment of the negative list, expansion of designated railheads, caps on value of transported goods, linkage of subsidies to employment generation, incentives for inland water transport, and additional MSME incentives; complementary measures under the Special Package and NEIIPP and ASIDE allocations were also considered for incorporation into a consolidated Cabinet proposal.