Since the implementation of Goods and Services tax in Jammu Kashmir since July 201, the subsidy for local small industries has ceased from that day. With the closure of the subsidy, the state’s small-scale industry has been in crisis and if the Centre and the State Governments do not take steps to save it, the main source of employment in Jammu Kashmir, already facing crisis, will been in larger crisis.
Prior to the implementation of GST, the state’s small-scale industry got an annual subsidy of 1700 to 2000 crores which has now been closed.
Reduction of new workers
This is the reason that there is a considerable decrease in the number of new industry operators after 2017 in the state. During the year 2016-17 and 2017-18, about 400 new industries were established in the Jammu division, from which around 2400 people got employment but in the year 2018-19 this figure was not even halfway. In 2018-19, only 140 new industrial units in the Jammu division started production and provided employment to about 1325 people.
Small industries Ignored in central package
After the GST was implemented, the central package was assisted to save nearly 400 large industries, but nearly 6,000 small units were completely ignored. Thousands of people are working in these units. The government is also providing freight and two percent financial assistance to around 400 major units, while no such help has been offered or given to small units. Small and minor units are the backbone of the state, which has already been affected due to the ongoing violence over the last thirty years. The state government had exempted these units from VAT. Prior to GST these companies were getting financial incentives.
Governor Satyapal Malik recently announced the package from the state government, It will also benefit only those who invest 50 crores or more. In such a case, small industries were deprived of this package. Therefore, it is essential that the government makes necessary modifications in its package to save small industries.
Small industries are not getting the benefits of the economic package
Under the subsidy refund, the grant of Rs. 100 crores has been approved by the State Government on Thursday. Under this, the state government will return the 50 percent tax of its share to the GST that was filled. It will be benefited only by those industrial units which are registered under Central Package. In this case, around six thousand small scale industries of the state will be deprived of this benefit. The biggest problem of the small industry is that today they are not getting the proper benefit of any economic package announced by the Central and State Government.
Industrialists forced to shut down units
According to Lalit Mahajan, the chairman of the Federation of Industries, the central and state government should provide financial assistance in the first place like setting up a new industry in Jammu Kashmir or expanding existing.
After the GST was implemented, the old concessions to the industry were not completely restored. As a result, far away from the new industry, many old units have been shutting down. Those who bought the land for the industry, they are giving back too.