Tuesday, November 30, 2010

Industrial Development: Suggestions for Rapid Industrialization

The Federation of Andhra Pradesh Chamber of Commerce (FAPCCI) is organized a Press Meet on “Expectations from Industry & Trade from the Chief Minister of AP” at Surana Udyog Auditorium, Federation House, FAPCCI, Red Hills, Lakdi-Ka-Pul, Hyderabad.

The FAPCCI demanding Industrial Board and Special Chief Secretary for good governence and handle many industrial problems and opportunities of Andhra Pradesh.

Mr. M.V. Rajeshwara Rao, Secretary General, FAPCCI discussed many issues with the media persons related to the industry, and he demanded Rs. 1500/- crore budget to allocate to the industrial development and increase which would provide employment to 5,00,000 persons all over the state.

  • The economy of Andhra Pradesh, predominantly agricultural in nature, witnessed a pleasant shift on the industrial front during 1970s when there was a spurt in the number of large, medium and small scale industries in several sophisticated lines. Although, this industrial development has to face certain ups and downs due to natural calamities and occasional spells of power shortages, the rate of growth was steady.
  • Today, the State is considered one of the fastest developing States in the country with a significant growth rate to its credit. It holds out good prospects for further growth with its abundant natural resources and good infrastructure.
  • Inspite of favorable conditions and opportunities the progress on industrial front, of late, is not encouraging. The following steps are suggested to accelerate the Industrial Development in the State:
  • There is lot of scope for development of agro based industries. These industries can be established in major villages for preliminary processing of agro industries which would ensure providing employment to a number of youth, educated and uneducated, countryside.
  • The units may be established @ 3 to 4 units in each mandal. This will not only ensure processing of local produce, reducing huge transport charges since the processing takes place at the places of production or nearby places.
  • There is a good scope for establishment of Industrial Clusters for appropriate activities at mandal levels which would provide not only provide employment to rural youth but also involves additional investment ensuring dispersal of industries which is a boon to the present concentration of industrial units in urban areas.
  • Infrastructure facilities at present are not conducive for the development of industries. Its upgradation more particularly for tiny and small units may be taken up.
  • At present, the flow of financial assistance to the SMEs is not encouraging. Steps may be taken for continuous flow of financial assistance.

  • It is observed that a number of educated candidates are facing unemployment which can be tackled by encouraging them to take industrial units through entrepreneurial development programmes.
  • Single Window System is ofcourse aimed at accelerating the process of Industrial Development but practically there are some stumbling blocks in its working. This needs to be addressed.
  • Inspection to industrial units may be replaced by compliance audits and self-certification.
  • Shortage of skilled manpower may be tackled. Skilled development institutes for each mandals may be established or atleast 2-3 institutes for each district may be established.
  • Stress may be given for establishment of industrial clusters for tiny units in rural areas.
  • Common Affluent Treatment Plants for clusters in industrial areas may be provided to ensure pollution free atmosphere.
  • Government programme such as Credit Guarantee Scheme to be implemented effectively.
  • Power shortage may be tackled and power backups may be proved so as to ensure supply of power for 24 x 7.
  • Marketing organization in each district may be established.
  • In recent times it is observed that there is no appreciable investment made for public sector activities in the State which in effect retarded the process of development of ancillary units in AP. It is suggested to enhance public sector investments with Public Private Partnership (PPP) in the manufacturing sector so as to accelerate the growth of ancillary units to create large scale employment opportunities and enhance the Industrial Production as a whole.
  • To introduce special incentives for setting up of large and medium scale Export-oriented industries to enhance export of finished goods from port to port basis.
  • Special incentives for Sunrise Industries with specific preference to aerospace technology, biotechnology and nanotechnology units which may give rise to establishment of large and medium scale units in such sectors.
  • The Incentive Policy of AP is considered as one of the best in the country which offers subsidies and reimbursements liberally. The speed with which the department completes the process of sanctions is encouraging and laudable. Normally, at no stage the cases are stalled. But unfortunately the process faces a dead stop at the stage of disbursements. This is like providing food to a hungry man and not allowing him to eat. If the sanctioned subsidies and incentives are released promptly it would greatly help the industrialists and improve their liquidity. This would further encourage young entrepreneurs to take up New Industries.


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