3 months on, policy fails to make industrial pushhttps://indianexpress.com/article/cities/chandigarh/3-months-on-policy-fails-to-make-industrial-push/

3 months on, policy fails to make industrial push

The Chandigarh Administration promised a lot while unveiling its industrial policy. But no concrete results are visible as of now.

Chandigarh Administration, IT industry, industry policy, chandigarh news, indian express
Factories in Phase I, Industrial Area, Chandigarh, on Sunday. (Sahil Walia)

WITH THE promise of allowing leasehold to leasehold transfer, encouraging IT and IT-enabled services in the city and providing facility of common application form through single-window system, the Industrial Policy unveiled by the Chandigarh Administration had provided a ray of hope to industry in Chandigarh. Three months down the line, there is not much that has taken place on ground.

Even though not all demands of the industrialists found a voice in the industrial policy that was unveiled by Punjab and Haryana Governor and UT Administrator Kaptan Singh Solanki, the industrialists had hoped it was a start and could lead to development of the industry. It was the first time that Chandigarh got an industrial policy which had been under consideration for the past several years. However, the wait continues for the administration to implement the provisions of the policy.

While announcing the policy, it was said that some of the provisions would be implemented by October this year. Among these was deciding on the transfer fee for leasehold to leasehold transfer and facility for common application form that can be submitted online as well. Both are yet to see the light of day.

President of the Chandigarh Industries Association M P S Chawla insists nothing special has come out of the policy. “Announcement of the policy was a positive step. However, the unresolved issues continue to remain so. There are certain decisions that the administration should take at the earliest. Among these is a decision on the imposition of penalty of Rs 500 per square feet per month for violations which is very high. The issue has been unresolved for several years and the penalty amount is piling up. The administration should take a decision on this before Diwali and withdraw all the notices given,” he says.


The industrialists have been demanding transfer of industrial plots from leasehold to freehold basis. While this has not been agreed to, the industrial policy made a provision for transfer of industrial plots from leasehold to leasehold. It was assured that a decision on the rates would be taken before October. While several meetings have been held to discuss the issue, no decision has been taken on the rates till now.

Amarbir Singh, chairman, Confederation of Indian Industry, maintains there is little scope for new industry to come up as Chandigarh is a landlocked city. At present, there is a slump in the market and expansion of industry will be slow.

“There is a need to take steps to consolidate the industry and encourage its development. Administration is yet to take a decision on leasehold to leasehold transfer. It is a good start that a policy was prepared for the first time. But there is a need to give the industry a much-needed push,” says Amarbir.

Industry in Chandigarh largely includes small scale industry, comprising ancillary units producing components for tractor industry in the neighbouring states. The other goods produced here include industrial fasteners, machine tools, plastic goods, pharmaceuticals, electronic items and furniture. In July 2006, the Chandigarh Administration allowed conversion of land use in Industrial Area phase I and II. The policy was discontinued in 2008. A total of 82 plots were permitted conversion of land use. This resulted in malls, multiplexes and hotels coming up in the Industrial Area, resulting in a burden on infrastructure.

The Industrial Policy of the administration has now put the focus on IT and IT-enabled industry. After the quashing of acquisition of land for Phase III of the Rajiv Gandhi Chandigarh Technology Park, the administration had decided that the expansion of the IT industry would be done in the Industrial Area. While allowing IT services, the administration mentioned in its policy that the existing units can set up IT-based industry, including software and electronics hardware units, but any activity entailing direct customer interface will not be allowed.

Under IT hardware units, activities such as manufacturing of computer devices, printer, scanners and related devices, networking products and telecommunication units are allowed. Under software units, entrepreneurs can opt for telecommunication and mobile communication software and application software operating system. Permission is granted for opening outsourcing units including call centres, audio visual or gaming production studios as well as web designing and web content development services.

Industrialist Arun Mahajan says that the IT industry is expected to grow further in the city. “Market is slow at the moment. However, it is expected that the IT industry will set up its units here. The permission to set up automobile service stations will get a positive response. However, there are certain demands that need to be fulfilled. The administration should take a decision on allowing need-based changes. A decision on the rates for leasehold to leasehold transfer should be taken,” he adds.

The administration constituted an advisory committee for industry with representatives of all associations as its members. The committee is yet to have its first meeting. The committee is to take decisions about issues concerning the industrialists that have to be taken up with the administration. The industrialists say that there is a need for having a high-powered committee with senior officials as its members so that decisions can be taken on the spot.

Another industrialist, Pankaj Khanna, who has been named as a member of the advisory committee, says that the industrialist policy allowed a lot of things. The industry requires ease of doing business. A single-window system is also required.
Positive response received,says UT Home Secretary

UT Home Secretary Anurag Aggarwal asserts that a positive response has been received from those wanting to set up IT and IT-enabled services as well as auto service stations. “We had said that a common application form for applying online and single window will be set up by October 2. However, the software is in the process of being developed. It is a complicated procedure as several departments are involved,” he says.

Meetings have been held for deciding the fees for leasehold to leasehold transfer. A final decision will be taken at the earliest, says Aggarwal, adding that a centre for excellence for the nuts and bolts industry will be set up in the city.


Aggarwal says that Chandigarh cannot offer incentives like Punjab and Haryana nor is there so much land. The focus will be on developing knowledge-based industry here.