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Karnataka targets 9 per cent economic growth rate

Fakir Chand in Bangalore

The Karnataka government has set an ambitious target of achieving an economic growth rate of 8-9 per cent annually during this decade with an industrial growth rate of 10-12 per cent from the current fiscal (2001-02).

The state's new industrial policy, which was approved by the Cabinet on Monday evening, envisages the setting up of an Infrastructure Development Fund with a corpus of Rs 1 billion to improve the infrastructure facilities across the state.

Announcing the highlights of the new policy, which comes into force retrospectively from April 1, 2001, state's small-scale industries minister S R Kashappanavar said the government would also form a technology upgradation fund with a seed capital of Rs 500 million to be disbursed over the next five years through state funding and development agencies.

"The fund will be utilised for providing interest subsidies to small and medium entrepreneurs to usher in total quality management, promotion of technology business incubators, and establishment of material and product-testing centres in the state," Kashappanavar said.

In a bid to revive the sagging industrial climate and kick-start the economy in the state, the policy offers 100 per cent exemption in stamp duty on key projects in core areas, besides exemption in payment of entry tax and sales tax on raw materials for export-oriented units, concessions in registration charges, and marketing assistance to SMEs.

"To ensure uniform and consistent industrial growth, the investor-friendly policy calls for uninterrupted and quality power supply by the state electricity board. We are committed to achieve the set targets from this year," the ruling Congress minister claimed.

According to state industries secretary B S Patil, the policy aims at achieving the targeted industrial growth by assuring the prospective and potential investors high-quality infrastructure, extension of institutional support to industries for technological upgradation, and deregulation of the business environment.

"In order to make the backward regions and rural areas of the state to contribute their mite for the overall economic growth, the policy will tap the immense potential of SSIs in rural areas to achieve the twin objectives of employment generation and utilisation of local resources," Patil said.

While developed areas in the state will not be entitled to investment subsidies; industries in developing and backward areas will be qualified for 10-25 per cent subsidies.

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