Manufacturing grows by over 12 pc; special regions soon

By Staff
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Google Oneindia News

New Delhi, July 11 (UNI) Riding on a resounding growth of over 12 per cent in the manufacturing sector in May 2006, government today said it will soon announce a major policy initiative for setting up the Manufacturing Investment Regions which will subsume within itself the Special Economic Zones.

Prime Minister's Council on Trade and Industry is meeting here on July 20 to discuss the proposal along with the report of the Ratan Tata-led Investment Commission which has recommended a host of measures to boost the country's manufacturing sector.

The manufacturing, with 80 per cent weightage in the overall Index for Industrial Production, witnessed 12.2 per cent growth in May this fiscal.

Witnessing a major revival, the manufacturing had grown by 10.4 per cent in April this year while the sector received as much as two billion dollar of foreign direct investment in 2005-06.

''Manufacturing is the most important cog in the wheel and the prime driver of the economic development. The proposed Manufacturing Investment Regions (MIRs) will be set up on areas of 100 and 150 square kilometers'', Commerce and Industry Minister Kamal Nath said today.

The government has already announced the implementation of a 10-year National Facturing Initiative and the contours of this initiative are being finalised in consultation with the stakeholders. A high level committee headed by Prime Minister Manmohan Singh and comprising Commerce and Industry Minister, Finance Minister, Planning Commission Deputy Chairman and National Manufacturing Competitiveness Council (NMCC) Chairman and concerned Secretaries has been constituted to deal with policy level issues that may arise in the implementation of this initiative.

He said the government's aim is to take a share of manufacturing from 16 per cent of GDP to 24 per cent by 2012 and 30 per cent by 2020. ''This calls for stepping up the rate of growth first to 12 per cent and thereafter to 14 per cent.'' The MIRs will be specialised areas of over 100 sq km where world-class infrastructure, both external and internal, will be provided through Central and state efforts, as per a Master Plan by the private developers.

Single Window clearance and flexibility in labour laws within these investment regions are also being explored, though these would require legal backing of State Laws.

A massive programme of National Skill Development is being worked out, so that the 6500 ITIs in the country start producing skills which are more contemporary and in large numbers.

A National Offset Policy is being considered for procurement by government departments and agencies, so that technology import incorporation, both in SMEs and in larger industries, becomes easier. Imports of goods from outside need to be linked up with import of first-class technology.

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