Lok Sabha Question No. 1884 (UNSTARRED), answered on 2019-07-03
Subject: Setting up of Industries
Ministry: COMMERCE AND INDUSTRY
Asked by: Pankaj Chowdhary

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY DEPARTMENT FOR PROMOTION OF INDUSTRY AND INTERNAL TRADE

## LOK SABHA

UNSTARRED QUESTION NO. 1884. TO BE ANSWERED ON WEDNESDAY, THE 3 RD  JULY, 2019.

## SETTING UP OF INDUSTRIES

## 1884.  SHRI PANKAJ CHAUDHARY:

Will the Minister of COMMERCE AND INDUSTRY be pleased to state:

## वाणिज्य एवं उद्योग मंत्री

- (a) whether  the  Government  has  formulated/proposes  to  formulate  a  plan  to promote setting up of the industries providing more opportunities of employment;
- (b) if so, the details thereof; and
- (c) the  steps  being  taken  by  the  Government  for  promoting  labour  oriented technology?

## ANSWER वाणिज ् य एवं उद्योग मंत्री ( श्री पीयूष गोयल ) THE MINISTER OF COMMERCE & INDUSTRY (SHRI  PIYUSH GOYAL)

- (a) to (c): Yes,  Sir.  Government  has  formulated  several  schemes  for  promoting setting  up  of  industries.  New  industries  when  setup,  lead  to  increase  in employment  opportunities.  Brief  description  of  important  schemes  of Department  for  Promotion  of  Industry  and  Internal  Trade  (DPIIT)  along with Ministry of Labour and Employment and Ministry of Micro, Small and Medium Enterprises (MSMEs) are given in Annexure .

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## ANNEXURE REFERRED TO IN REPLY TO PARTS (a) TO (c) OF LOK SABHA UNSTARRED QUESTION NO. 1884 FOR ANSWER ON  03.07.2019.

## A. Initiatives of Department for Promotion of Industry and Internal Trade 1. Make in India

The  'Make  in  India'  initiative  was  launched  on  25.09.2014  with  the  objective  of facilitating  investment,  fostering  innovation,  building  best  in  class  manufacturing infrastructure, making it easy to do business and enhancing skill development. Make in India initiative focuses on 27 sectors and action plans have been prepared for 25 sectors.

## 2. Startup India

Startup India was launched on January, 16th 2016 with an objective to build a strong eco-system  for  nurturing  innovation  and  startups  in  the  country  that  will  drive sustainable  economic growth  and  generate  large  scale  employment  opportunities. Since  its  inception,  19,351  Startups  across  the  country  have  been  recognised  by Department for Promotion of Industry and Internal Trade (DPIIT) as on 24.06.2019. The incentives provided to Startups under Startup India initiative are:

- i) Self-Certification under 6 Labour Laws & 3 Environmental Laws
2. ii) Relaxations in Public Procurement Norms
3. iii) Faster exit under the Bankruptcy Code
4. iv) Rebates  on  Patent  &  Trademark  filing  fees,  support  from  facilitators and expedited examination of Patent application
- v) Income Tax exemption on income of Startups
6. vi) Exemption  from  Income  Tax  on  investments  received  above  fair market value
7. vii) Funding support under the Fund of Funds for Startups
8. viii) Guidance and facilitation support from Startup India Hub

## 3. Ease of Doing Business

In order to improve the business environment in the country, DPIIT has taken up a series of measures to simplify and rationalize the regulatory processes (registration and inspection processes) and introduction of information technology as enabler to make governance more efficient and effective. As a result of these initiatives, India has improved its rank in the World Bank's Doing Business Report (DBR) 2019 to 77 th as against 100 th rank in the DBR 2018.

## 4. Modified Industrial Infrastructure Upgradation Scheme (MIIUS)

Under  MIIUS,  notified  in  July  2013,  projects  have  been  undertaken  to  upgrade infrastructure  in  existing  Industrial  Parks/  Estates/  Areas.  Greenfield  projects  have also been undertaken in backward areas and North Eastern Region (NER). Projects are implemented by the State Implementing Agency (SIA) designated by the State Government. Central Grant upto 50% of the project cost with a ceiling of Rs.50 crore is provided with at least 25% contributions of SIA. In case of North Eastern States, the  Central  Grant  and  minimum  contribution  of  the  SIA  are  up  to  80%  and  10% respectively.

## 5. Industrialization in North Eastern Region

The  Government  of  India  has  notified  North  East  Industrial  Development  Scheme (NEIDS)  -  2017  to  promote  industrialization  in  the  States  of  North  East  Region including  Sikkim  effective  from  1.4.2017  to  31.3.2022.  The  incentives  under  the scheme  include-  (i)  Central  Capital  Investment  Incentive  for  access  to  credit (CCIIAC)  (ii)  Central  Interest  Subsidy  (CII)  (iii)  Central  Comprehensive  Insurance Incentive (CCII) (iv)Goods and Services Tax (GST) Reimbursement (v) Income Tax (IT) Reimbursement (vi) Transport Incentive (TI) and (vii) Employment Incentive (EI). This  scheme  replaces  the  erstwhile  scheme  North  East  Industrial  and  Investment Promotion Policy (NEIIPP), 2007, which ended on 31st March, 2017, under which 27,644 industrial units were set up. These units generated employment for 2,28,224 people  and  attracted  an  investment  of  Rs.11,466.22  crore  in  NER  states  up  to 31.03.2017. Since inception, Rs. 2,452.71 crore has been released to the States of NER under the scheme, of which, Rs. 528.00 crore was released in the FY 2018-19.

## 6. Scheme for Himachal Pradesh and Uttarakhand

Special  Package  (package-I  and  package-II)  for  the  States  of  Himachal  Pradesh and Uttarakhand were introduced from January 2003 to 31th March, 2017. Central Capital Investment Subsidy was made available to the eligible industrial units in the state.  DPIIT  has  introduced  Industrial  Development  Scheme  (IDS)  for  Himachal Pradesh and Uttarakhand with two incentives namely, (i) Central Capital Investment Incentive for access to credit (ii) Central Comprehensive Insurance Incentive w.e.f. 01.04.2017 to 31.03.2022. The committed liability will also be covered. Pursuant to decision of the Cabinet Committee on Economic Affairs to pay a budgetary support to the industrial units that are already availing excise duty exemptions Department for Promotion of Industry and Internal Trade (DPIIT) notified 'Scheme of Budgetary Support to the eligible units located in the States of Jammu & Kashmir, Uttarakhand, Himachal  Pradesh  and  North  Eastern  States  including  Sikkim  under  Goods  and Service Tax Regime' dated 05.10.2017. It will remain in force from 01.07.2017 till 30.06.2027. The Scheme is offered as a measure of goodwill to continue committed liability  for  the  residual  period  out  of  a  total  of  10  years.  Under  this  new  Scheme, budgetary  support  to  the  extent  of  Central  Government's  share  in  the  CGST collected from the industrial units is to be provided.

## 7. Make in India in Public Procurement

The  Public  Procurement(Preference  to  Make  in  India),  Order  2017  was  issued pursuant  to  Rule  153(iii)  of  the  General  Financial  Rules  2017  as  an  enabling provision to promote domestic value addition in public procurement. The policy aims at incentivizing production linked through local content requirements thereby encouraging  domestic  manufacturers'  participation  in  public  procurement  activities over entities merely importing to trade or assemble items.

This  Order  is  applicable  on  procurement  of  goods,  services  and  works  (including turnkey works) by a Central Ministry/ Department, their attached/subordinate offices, autonomous  bodies controlled by the Government  of India and Government companies.

The salient features of the Order are:

- i) In  procurement  of  all  goods,  services  or  works  in  respect  of  which  the estimated value of  procurement is less than INR 50 Lakh, only local suppliers are  eligible  to  bid  (except  in  certain  cases).  However,  in  procurement  of  all goods, services or works, in respect of which the Nodal Ministry / Department has communicated that there is sufficient local capacity and local competition, only local suppliers shall be eligible to bid irrespective of purchase value.
2. ii) In other cases and where the lowest bid (L1) is not by a local supplier:
- a.  If goods are divisible, local suppliers get Purchase Preference for half of the contract bid at the L1 price;
- b.  If the goods are not divisible or the services being procured are being valued  on  price  alone,  the  entire  contract  shall  be  awarded  to  such local supplier subject to his matching the L1 price.
5. iii)  The margin of Purchase preference for local suppliers is 20%.
6. iv)  As  per  the  Order,  restrictive  and  discriminatory  clauses  against  domestic suppliers cannot be included in procurement by Central Government agencies.
- v)  As per Clause 10(d) of the Order, if a Nodal Ministry is satisfied that Indian suppliers  of  an  item  are  not  allowed  to  participate  and/  or  compete  in procurement  by  any  foreign  government,  it  may,  if  it  deems  appropriate, restrict or exclude bidders from that country from eligibility for procurement of that item and/ or other items relating to that Nodal Ministry.

## 8. Indian Footwear Leather and Accessories Development Programme (IFLADP)

IFLADP is a central sector scheme with an approved expenditure of Rs. 2,600 crore for  implementation  during  2017-18  to  2019-20.  The  scheme  aims  to  develop infrastructure, increase production, facilitate investments, generate employment and address environment concerns specific to leather and footwear sector.

## B. Initiatives of Ministry of Labour and Employment

Government  has  implemented  the  National  Career  Service  (NCS)  Project  which comprises  of  a  digital portal that  provides a nation-wide online platform for jobseekers and employers for job matching in a dynamic, efficient and responsive manner and has a repository of career content.

Pradhan  Mantri  Rojgar  Protsahan  Yojana  has  been  initiated  by  the  Ministry  of Labour and Employment in the year 2016-17 for incentivizing industry for promoting employment  generation.  Under  this  scheme,  Government  is  paying  the  entire employer's contribution  (12  %  or  as  admissible)  towards  the  EPS  and  EPF for  all sectors w.e.f. 01.04.2018 to all eligible new employees for the next 3 years from the date of registration of the new employee.

## C. Initiatives of Ministry of Micro, Small and Medium Enterprises (MSMEs)

- i) A Survey on ' Unincorporated Non-agricultural Enterprises (excluding construction) ' 73 rd round (July, 2015-June, 2016) shows that the total employment in the MSME Sector is 1,109.89 lakh.
2. ii) The focus of most of the schemes implemented by the Ministry of MSME is to support Micro, Small and Medium Enterprises by providing them with access to finance,  market  access,  common  facilities  and  common  infrastructure  through the MSE Clusters and also promoting self-employment through Entrepreneurship Development  Programmes  and  also  technical  skilling  through  intensive  short term and long term training programmes in the Tool Rooms/Technology Centres and  make  the  youth  employable  in  the  industries.  During  2018-19,  18  MSME Technology Centres have trained 2, 08,174 trainees.
3. iii) The main schemes of this Ministry inter-alia include Prime Minister's Employment Generation programme (PMEGP), Mission Solar Charkha, Scheme of  Fund  for  Regeneration  of  Traditional  Industries  (SFURTI),  A  Scheme  for Promoting  innovation,  Rural  Industry  &  Entrepreneurship  (ASPIRE),  Credit Guarantee  Fund  Scheme,  Credit  Linked  Capital  Subsidy  Scheme  (CLCSS), National    Manufacturing    Competitiveness  programme  (NMCP),  Marketing Assistance Scheme and MSE-Cluster Development programme.
4. iv)  MSME Technology Centres (TCs) also play an important role in bridging the gap between demand and supply of skilled manpower by providing training to youth and making them employable.
- v) To  ease  credit  flow  to  MSEs,  Government  is  implementing  'Credit  Guarantee Trust Fund for Micro and Small Enterprises (CGTMSE) Scheme, the Corpus of which has been enhanced from Rs. 2500 crore to Rs. 7500 crore with increase of the individual loan limit of Rs. 1 crore to Rs. 2 crore.  The extent of Guarantee coverage above Rs. 50 lakh was also enhanced from 50% to 75%. During  2014-18,  as  many  as  16  lakh  entrepreneurs  were  provided  guarantee coverage  of  more  than  Rs.  80,000  crore,  thereby  generating  employment opportunities.
6. vi)  Under Prime Minister's Employment Generation Programme (PMEGP), as many as  1.93  lakh  units  were  set  up  providing  employment  to  14.75  lakh  people between 2014-18.
7. vii)  A  digital  platform  viz.  MSME  SAMPARK  portal  has  been  launched  wherein job-seekers  (passed  out  trainees/students  of  MSME  Technology  Centres)  and recruiters get connected.

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