Finance Minister T.M. Thomas Isaac used the Budget speech on Friday to lay out a road map for improving the State’s position in the ‘ease of doing business’ rankings. The construction of three industrial corridors with a capital investment of around ₹50,000 crore will start in 2021-22.
The cut in Value Added Tax on CNG/LNG from 14.5% to 5% brings cheers not just to PSUs such as FACT and BPCL, but also to domestic consumers of city gas projects. The stamp duty on sale deed has been reduced from 8% to 4% and the registration fee from 2% to 1%.
The cut in VAT and duty would lead to a total revenue loss of ₹191 crore. This revenue loss at a time when the finances were battered by COVID-19 showed the government’s intent in attracting fresh investments and creating jobs. The 10% duty on power consumption has been exempted for new industrial investments for the first five years.
Dr. Isaac said the production in PSUs had increased from ₹2,799 crore in 2015-16 to ₹3,148 crore in 2019-20. The number of Micro-Small-Medium enterprises has increased from 82,000 to 1.4 lakh in the same period, with an increase in number of employees from 4.18 lakh to 6.38 lakh. An amount of ₹250 crore is allocated for PSUs for modernisation.
A special park for cancer medicines with funds of ₹150 crore from the KIIFB will become a reality in 2020-21. Six medicines having market value of ₹250 and essential for organ transplant patients will be marketed at ₹40 on commercial basis in February. Drugs exports to Asian and African countries will begin soon.
As part of the three industrial corridors, the Kochi-Palakkad corridor will have an investment of ₹10,000 crore and provide 22,000 direct job. The master plan for the Kochi-Mangalore corridor has been prepared. The Capital City Regional Development Programme will establish a massive network of knowledge hubs, industrial parks and townships in the eastern side of the city, connected to the Vizhinjam Port. The expected investment of this scheme is ₹25,000 crore and 2.5 lakh jobs.
A total of ₹401 crore is provided for major industrial development agencies such as KSIDC and KINFRA. Industrial Parks are being set up by KSIDC in Kasaragod, Amballoor, Kuttiyadi, Wayanad, Kozhikode and Kakkanad.
Kerala Rubber Limited will be established with 26% government share for setting up a hub for rubber based industries, including tyres. The anticipated capital investment is ₹1,050 crore. A cooperative society on the lines of Amul will procure rubber. The construction of Carbon Neutral Coffee Park in Wayanad will be completed with the financial aid from the KIIFB.