Investment in Northeast comes down to 0.13 per cent: FINER report

Apart from providing specific incentives to encourage FDI in the northeastern region, FINER also suggested the removal of the cap on capital subsidy. The industry body also emphasised giving purchase preference from local industries by the Central government, PSU and Central government departments, writes Gautam Debroy of ETV Bharat.

New Delhi: Even as the Central government is giving more emphasis to the all-round development of the Northeastern region, a report compiled by the Federation of Industry and Commerce of North Eastern Region (FINER) has revealed that the investment in this landlocked region has come down to 0.13 per cent in 2021.

The decreasing trend in investment was observed under the Northeast Industrial Development Scheme (NEIDS), an exclusive scheme launched for investment promotion in the region in 2017. Such a trend has forced the captains of the industry to register their complaints to the Central government for a better investment policy for 10 years.

"The share of investment in the northeastern region under North East Industrial Investment Promotion Policy, 2007 (NEIIPP) was 8.3 per cent of the national share in 2017, while the percentage of the national share of the northeastern region came down to 0.13 per cent in 2021 under NEIDS," said FINER in a report submitted to the Central government recently.

Stating that investment in the Northeast was earlier coming under the NEIIPP-2007, the industry body pointed out that the investment witnessed a drastic downfall under NEIDS. It was in 2007, the then-Central government notified an exclusive industries promotion scheme for the northeast by the name NEIIPP for a period of 10 years. After the expiry of its duration, the present Central government launched another scheme named NEIDS.

The government aimed to furthering catalyse industrial development in the northeastern region, including Sikkim. Came into force on April 1, 2017, the NEIDS, however, remained in force till March 2022. Speaking to ETV Bharat, FINER president Bajrang Lohia said that the northeastern region urgently needs a very good investment policy.

"There is a need for industry-friendly investment policy to kickstart the investment in the region," Lohia said. He said that it is also necessary to develop infrastructure and connectivity networks besides addressing issues of border points to make the Act East policy a reality. The FINER while submitting its report to the Central government also gave recommendations to overcome the socio-economic challenges in the region.

Apart from providing specific incentives to encourage FDI in the northeastern region, FINER also suggested the removal of the cap on capital subsidy. The industry body also emphasised giving purchase preference from local industries by the Central government, PSU and Central government departments. "To foster innovations in MSMEs of the northeastern region, there is a need to formulate an attractive industry-academia collaborative R&D scheme, which could be sponsored centrally up to 90 per cent fundings," the FINER said while putting forward its recommendations.