(MENAFN- KNN India) Micro and small scale industries in Karnataka are in a terrible shape and industry is facing slow down due to several major issues lying unattended by the State government, said industry body KASSIA.
While lamenting at an interactive meet with Minister for SSI, Satish L Jarkiholi, on Friday KASSIA President V K Dikshit said, "The latest bone of contention between the MSME sector and the State government is the decision to change the lease period for allotment of industrial land by KSSIDC/KIADB to entrepreneurs from hitherto 10 years to 99 years."
Vociferously opposing this change, Dikshit declared that none of KASSIA's 4,000-odd MSME Member-units were interested in applying for industrial land on 99 year lease.
KASSIA vice-president A Padmanabha questioned the premise of the policy change like perceived misuse of industrial land for speculative real estate purpose by entrepreneurs and said that for a handful of black sheep, lacs of small entrepreneurs were being victimized by the government.
He also pointed out that there was no statistics to corroborate the official perception of misuse of industrial land, KASSIA said in a release today.
Describing the industrial land lease policy as anti-MSME, KASSIA pointed out that it compared poorly with what was prevailing in other States.
"The lease amount is pegged at 10 per cent of the land value in Gujarat and 20 per cent in Maharashtra. Further if an entrepreneur in Karnataka wishes to return the land to KSSIDC/KIADB after a few years, he is required to pay up as much as 50 per cent of the value of appreciation in the land price," it said.
The present scenario of power cuts came in for sharp criticism from many entrepreneurs, with a representative from Malur Industries Association stating that there was nearly 19 hours power cut for the last 15 days in Malur industrial area spread over 1000 acres, and this was the situation when a lot of investments was pouring in to Malur.
A Memorandum presented by KASSIA to the Minister highlighted few other issues concerning the MSME sector, such as strict implementation of 15 per cent Purchase Preference with PSUs; Exempting levy of pro-rata charges of Rs 300 per sq meter on MSMEs or at least levy of nominal charges; and issue of 2 acres of industrial land to MSEs on 10 years lease, among others.
Responding to the queries, the SSI Minister observed that many of the issues were in the final stages of being resolved and the final word on this was delayed as the Industries Department officials and the government was busy with ensuring the success of the forthcoming Invest Karnataka 2015 global summit in November, the release said
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