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New Industrial Development Scheme for Jammu & Kashmir (J&K IDS, 2021)

Topics covered: Inclusive growth and issues arising from it.

New Industrial Development Scheme for Jammu & Kashmir (J&K IDS, 2021)


Context

Government of India has formulated New Industrial Development Scheme for Jammu & Kashmir (J&K IDS, 2021) for the development of Industries in the UT of Jammu & Kashmir.

About the scheme:

J&K IDS, 2021 is a Central Sector Scheme. The scheme aims to take industrial development to the block level in UT of J&K, which is first time in any Industrial Incentive Scheme of the Government of India.

  • The financial outlay of the proposed scheme is Rs.28400 crore for the scheme period 2020-21 to 2036-37.
  • Scheme while encouraging new investment, also nurtures the existing industries in J&K by providing them working capital support at the rate of 5% for 5 years.

Objective:

Main purpose of the scheme is to generate employment which directly leads to the socio economic development of the region.

  • It aims at development of Manufacturing as well as Service Sector Units in J&K.

Key Features of the Scheme:

  • Scheme is made attractive for both smaller and larger units.
  • It attempts for a more sustained and balanced industrial growth in the entire UT.
  • Scheme has been simplified on the lines of ease of doing business by bringing one major incentive- GST Linked Incentive- that will ensure less compliance burden without compromising on transparency.
  • It is not a reimbursement or refund of GST but gross GST is used to measure eligibility for industrial incentive to offset the disadvantages that the UT of J&K face.

Major Impact and potential:

Scheme is to bring about radical transformation in the existing industrial ecosystem of J&K with emphasis on job creation, skill development and sustainable development.

It will attract new investment and nurturing the existing ones, thereby enabling J&K to compete nationally with other leading industrially developed States/UTs of the country.

InstaLinks:

Prelims Link:

  1. What is J&K IDS?
  2. Duration of the scheme.
  3. Purpose?
  4. Incentives given under the scheme.
  5. Central Sector Scheme VS Centrally Sponsored Scheme

Mains Link:

New Industrial Development Scheme for Jammu & Kashmir scheme attempts for a more sustained and balanced industrial growth in the entire UT. Discuss.

Source: PIB