Industrialisation of backward areas fails to take off

New Delhi, May 4 (UNI) Sixteen years after the Central government's growth centre scheme became operational with the objective of industrialising the backward areas of the country, the Planning Commission said the scheme had '' failed to achieve its objectives, except in few isolated cases''.

While accepting that funds should not be wasted on the failed growth centres, the parliamentary standing committee on commerce said successful growth centres, however, should not be left in the lurch. The commitee headed by Dr Murli Manohar Joshi presented its 81st report in the Rajya Sabha yesterday.

The committee urged the government to re-examine its earlier recommendation for setting up of special purpose vehicle (SPV) for effective implementation of the scheme, adding time has come for threadbare analysis of the scheme.

After the Planning Commission's evaluation of the scheme, the government commissioned National Productivity Council (NPC) to conduct a detailed study of the scheme. Of the 71 growth centres sanctioned under the 1988-scheme, which became operational three years later, NPC's findings rated 24 growth centres highly or moderately successful, 18 somewhat successful and 20 not successful at all. The remaining nine centres were not studied.

Following NPC's report, the Planning Commission recommended abandoning of centres found not successful and suggested operationalising only those centres which had potential for coming up within two years.

Subsequently, the government did not sanction any growth centre in 2006-07 but released Rs 10.15 crore for completion of ongoing centres. Only Rs 5 crore has been provided in the current financial year for completing those centres which have potential to become successful.

Initially, the Central government provided an equity of upto Rs 10 crore to state governments for setting up such centres. The Central assistance was increased to Rs 15 crore for each growth centre in north-eastern region, including Sikkim, and Himachal Pradesh, Uttarakhand and Jammu and Kashmir.

These centres were provided basic infrastructure such as power, water, telecommunications and banking to attract industries.

UNI