Srinagar, Oct 11: Jammu and Kashmir is preparing a new industrial policy aimed at attracting investment, supporting existing businesses and creating jobs, with the government weighing the cost of incentives against its limited financial resources.
Two senior government functionaries have been authorised to consult stakeholders and examine industrial policies adopted by other states, particularly neighbouring ones, before the draft is finalised, official sources said.
The Finance Department will scrutinise the draft to determine what incentives J&K can afford, the sources said, highlighting a central challenge for the policy: balancing the need to attract fresh investment with the administration’s fiscal constraints.
The government wants to introduce the policy at the earliest, they said, as it approaches the completion of two years in office.
Chief Minister Omar Abdullah, who also holds the finance portfolio, recently reviewed preparations for the policy with senior officials of the J&K administration.
The proposed framework is expected to take employment generation into account, while offering support to existing industrial units and encouraging entrepreneurs to establish new businesses.
Officials will consult stakeholders before the draft is released, the sources said.
The Industries and Commerce and Finance departments will play key roles in shaping the final policy.
J&K would not be able to match the scale of incentives offered by states such as Punjab, given its limited resources, the sources said.
They said that the government would seek to provide whatever support its finances permitted.
Industrial bodies in J&K have repeatedly called for a new policy, arguing that it is needed to sustain existing units and encourage further industrial development.
The policy is being prepared as J&K continues to process investment proposals under a central government incentive programme launched in 2021.
The New Central Sector Scheme, introduced on April 1, 2021, has an allocation of 28,400 crore rupees and is scheduled to run until 2037.
The J&K administration has sought an increase in the incentive allocation to Rs 75,000 crore, citing strong interest from businesses and applications from additional units seeking registration.
A total of 971 industrial units have been approved under the scheme, according to official figures cited by the sources.
Of these, 918 were approved earlier, while 53 received approval recently.
The 53 newly approved units are expected to bring investments of Rs 1626 crore and generate 2902 jobs.
The 918 previously approved units are expected to attract investments of Rs 12,668 crore and create 48,995 employment opportunities.
Together, the approved projects represent anticipated investments of Rs 14,294 crore and 51,897 jobs, although the figures describe projected outcomes rather than confirmed investment or employment already realised.
Officials are also assessing whether additional units can be accommodated under the central scheme by calculating the incentive funds still available, the sources said.
The proposed industrial policy will have to address the needs of businesses seeking support while determining how far the administration can extend incentives without exceeding its financial capacity.
The government has yet to finalise the draft, and the extent of the benefits available to industry will depend on the Finance Department’s assessment of the resources that can be made available.
