As the industrial policy for J&K enters review, stakeholders are calling for growth that is wider, fairer and built to last. Danish Mohiuddin reports.

Ahead of the high-level review meeting on the 28,400-crore New Central Sector Scheme (NCSS) for J&K reportedly scheduled to be chaired by the Union Home Minister on May 30, industry stakeholders and experts have expressed hope that the review process would address certain emerging concerns relating to balanced industrial growth, revival of existing enterprises and equitable distribution of incentives across J&K.

The industrial package announced by the Government of India in 2021 is widely acknowledged by business circles as one of the most significant economic initiatives undertaken for J&K in recent decades. 

Stakeholders believe that the scheme has helped revive investor confidence, generate industrial interest and create a positive atmosphere for economic activity in the region.

However, while appreciating the initiative, industry observers maintain that the evolving investment pattern under the scheme also highlights the need for a more region-sensitive and balanced approach going forward.

According to industry experts, one of the principal objectives behind the launch of the scheme was to take industrialisation to block and district levels across J&K. 

Nevertheless, investment proposals approved so far reportedly indicate concentration in selective industrial pockets possessing relatively better infrastructure and connectivity, while several districts continue to witness comparatively limited industrial response.

Economic analysts and stakeholders believe that a district-sensitive allocation model could help ensure more balanced industrial growth.

Some industry representatives are of the opinion that the overall package, if notionally distributed across all the 20 districts of J&K, would have encouraged investors to spread industrial activity more evenly across J&K instead of concentrating in limited locations.

They suggest that any future enhancement or expansion of the package may consider this principle to ensure wider geographical distribution of industrial investments and employment opportunities.

Another issue increasingly being highlighted by stakeholders relates to the emerging challenge of unequal incentive structures within the industrial sector.

According to business representatives, while the New Central Sector Scheme has undoubtedly generated optimism and investment interest, a substantial number of enterprises that had registered within the prescribed time frame reportedly remained outside the approved list due to limitation of funds. 

Simultaneously, thousands of existing industrial units that have survived decades of extraordinary disruptions continue to remain beyond the ambit of meaningful incentive support despite operating under the same difficult economic conditions.

Industry observers point out that coexistence of two sharply differentiated incentive regimes within the same industrial ecosystem may unintentionally create distortions on the ground.

Enterprises operating side by side under identical geographical, logistical, and economic disadvantages may eventually face vastly different cost structures and competitive capacities depending solely upon whether they were accommodated within the approved incentive framework. 

Experts believe that such disparities may adversely affect industrial balance, discourage revival of existing enterprises and create uneven competitive conditions within the local industrial sector over time.

Business circles therefore emphasise that sustainable industrialization in J&K requires a more comprehensive and inclusive policy approach covering not only newly approved units but also eligible units left out despite timely registration, existing enterprises undertaking revival and expansion, and prospective units in underdeveloped districts. 

According to stakeholders, industrial policy in a geographically disadvantaged and sensitive region like J&K must function as an instrument of broad-based economic stabilization and balanced regional development rather than remaining confined to selective pockets alone.

Another issue being strongly highlighted by stakeholders relates to the condition of existing industrial units in J&K. 

Business representatives point out that while new investments are important, revival and strengthening of existing enterprises is equally critical for sustainable industrialisation.

According to industry estimates, nearly 40,000 industrial and business units in J&K possess substantial assets and infrastructure on ground, many of which have suffered severe stress over the past three decades due to prolonged disturbances, repeated shutdowns, floods, economic disruptions, policy uncertainty and financial distress. 

Stakeholders argue that revival, modernisation, rejuvenation and expansion of these units could generate large-scale employment and economic activity by utilising already existing industrial infrastructure and entrepreneurial capacity.

Experts believe that a dedicated revival and rehabilitation corpus for existing industrial units could significantly improve capacity utilisation, revive stressed enterprises, and create employment at comparatively lower cost and within shorter timelines than creation of entirely new infrastructure.

Industry circles have also stressed the need for stronger market support for local enterprises. Stakeholders have suggested that Central Public Sector Enterprises, PSUs, and major executing agencies operating in J&K may be encouraged to procure part of their requirements through local industrial units and contractors in accordance with MSME promotion objectives.

Observers maintain that sustainable industrialisation in J&K requires a balanced policy framework that simultaneously supports new investments, revival of existing enterprises and assured market access for local industry. 

Stakeholders have expressed hope that the forthcoming review meeting would provide an opportunity to further strengthen the industrial policy framework of J&K in a manner that is equitable, regionally balanced and employment-oriented, while building upon the positive momentum already created by the Centre’s industrial development initiatives in J&K.

About the Author

A postgraduate in Convergent Journalism, the author approaches storytelling as a visual and narrative craft. With a strong interest in cinematography and filmmaking, his work often lingers on the human dimensions of news. Drawn to stories that matter to people, he writes with an eye for both movement and meaning.