Only SCS can bolster industrial development, Jagan tells Modi

VIJAYAWADA: Chief Minister Y.S. Jagan Mohan Reddy asserted the need for Special Category Status (SCS) to ensure rapid industrial development in Andhra Pradesh and appealed to Prime Minister Narendra Modi to accord SCS on a priority basis. The Chief Minister interacted with Modi during the Niti Ayog's Governing Council meeting, held virtually, on Saturday.

Explaining about ongoing developments in the state, he said, "Rapid industrialization of my state is possible only if SCS is accorded. This was a commitment made on the floor of the Parliament and was a precondition to the bifurcation."

The Chief Minister said that the sixth meeting of the Governing Council assumes significance in the context of the economic upheaval caused by Covid-19. He stated that it is imperative that during these critical times, state governments and the Centre should explore opportunities to engage in meaningful discussions to adopt a unified approach towards policy formulation for the country’s economic revival. Complimenting Modi for his visionary leadership and Niti Aayog for specifying six pertinent agenda points for the meeting, he said that these points relate to vital areas and require utmost emphasis.

The Chief Minister said that with respect to the first agenda point of making India a global manufacturing hub, the give significant impediments to the manufacturing sector’s growth are the exorbitant cost of funds available from  financial institutions, high cost of power, delays associated with land procurement, delay and complexity in the grant of statutory clearances and rigid labour laws. He said state governments and the Union Government must take a deeper drive to understand the root-cause and make a conscious effort to introduce reforms to mitigate the hurdles.

Jagan Mohan Reddy said that for building infrastructure, state government’s undertakings take loans from financial institutions like PFC and REC at higher rates of interest of 10-11 per cent per annum.

With this enormous debt-servicing requirement, the manufacturing units cannot hope to offer products that can compete with those from other states, where loan is available at interest rates as low as 2-3 per cent. He said that the state government was encouraging a performance-linked incentive scheme for new manufacturing units and compiled 229 reforms under the district business reform action plan of the Union government. 

The Chief Minister said, “Despite my state’s commitment to provide a business-friendly environment, industrialisation is yet to gather growth momentum. This is due to several constraints, resulting from the unjust and inequitable bifurcation of the erstwhile State of Andhra Pradesh."

“The bifurcation resulted in my State being deprived of tier I city status, infrastructure, employment opportunities and financial resources. The rapid industrialization of my State is possible if only “Special Category Status” is accorded. This was a commitment made on the floor of the Parliament and was a pre-condition to the bifurcation.”