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Friday, April 23, 2021

For failing to push industrial growth, creating jobs in Punjab, PSIEC blames ‘era of terrorism’

The CAG, in its latest audit report, however, did not buy this. “The reply is not convincing as the risks associated with the project are always factored into while proposing a project,” it said.

Written by Navjeevan Gopal | Chandigarh |
Updated: March 26, 2021 9:45:14 am
Pune micro units hit by Covid-19The CAG report also highlighted how PSIEC faltered in generating employment and revenue. “Timely implementation of industrial projects is a pre-requisite for development of industries in the State and consequential employment and revenue generation. (File)

The Punjab Small Industries and Export Corporation (PSIEC) Limited, a public sector undertaking, has failed to accelerate industrial growth, promotion of exports and job creation in the state, the Comptroller and Auditor General (CAG) of India has found.

Intriguingly, the PSIEC management in its reply in June last year to the CAG audit had said that “entrepreneurial spirit of allottees and industry in Punjab passed through era of terrorism and acute recessionary phase; given this scenario, the state government and the PSIEC took several measures to motivate the plot holders to come forward and set up their projects”.

The CAG, in its latest audit report, however, did not buy this. “The reply is not convincing as the risks associated with the project are always factored into while proposing a project,” it said.

Making hard hitting observations on the functioning of the PSIEC, the report tabled in the Vidhan Sabha during the recently concluded budget session, said, “The Company (PSIEC) has not procured land for creation of land bank since implementation of the Industrial Policy of 2009. It allotted undeveloped plots and transferred the vacant plots against the allotment policy of the state government and overlooking its financial interests. As many as 4,089 plots (38 per cent) out of 10,735 allotted plots were lying vacant and the Company did not monitor execution of the projects by the allottees.”

“The Company failed to achieve the objectives of the exports schemes of the Government of India besides funds were released to ineligible projects and the allottees did not execute the projects relating to infrastructure and promotion of exports. Thus, the Company had not played its role in development of industries in the state effectively and failed to accelerate industrial growth, promotion of exports and job creation. In the absence of an effective management information system, the Company failed to identify the areas of weakness and take remedial actions in time and also not initiated action for cancellation/resumption of plots as per the terms of allotment,” the report pointed out.

The CAG report also highlighted how PSIEC faltered in generating employment and revenue. “Timely implementation of industrial projects is a pre-requisite for development of industries in the State and consequential employment and revenue generation. Through scrutiny of project reports of 33 projects at nine out of 24 selected IFPs (Industrial Focal Points), it was observed that these projects envisaged turnover of Rs 3,710.95 crore and providing employment to 4,062 persons. However, none of the projects were executed (upto March 2019) even after a lapse of period ranging between four months to 30 years, which resulted in non-generation of the intended benefits,” said the CAG report.

Chamber of Industrial and Commercial Undertakings (CICU) president Upkar Singh Ahuja too said that PSIEC contention of blaming sorry state of affairs in industry to terrorism did not hold any water. “It has been more than two decades that terrorism is over,” said Ahuja.

Ahuja, in fact, alleged that PSIEC harasses industrialists. Citing an example, he said an industrialist operating a unit for two decades was made to run from pillar to post to get a plot transferred after death of partner. “PSIEC should function in a systematic and crystal clear manner. It was envisaged to be a body to serve the industry, but it has become a profit making body. If it rationalises the industrial plot rates, it can still script a turnaround for industrial growth in Punjab,” said Ahuja.

Federation of Punjab Small Industries Association Badish Jindal too minced no words in questioning the functioning of the PSU. “The PSIEC was supposed to be a facilitator to promote industry. It was set up to service the industry. But, it has become a profit making body,” said Jindal, adding that the price of land quoted by the PSIEC to industrialists was much higher than what it paid to purchase and develop that land.

Alleging red tapeism where one had to move through “many channels”, Jindal said there were scores of litigations in the court involving PSIEC. He further said that industrialists preferred to buy land at “mixed use land areas” where they got better deal than at focal points. Jindal also alleged that there was stagnation in PSIEC functioning as top posts were occupied by same persons for several years. He added that posting new officials could give a new lease of life to the industrial promotion body. “We have been taking up these issues with the government. We want that big names in private sectors should be roped in so that there is competitive environment. Like in residential colonies, the private colonisers have created a competitive environment by offering residential units at lesser prices.”

Pointing out that “a few private players” tried to venture into creating industrial hubs but could not succeed, Jindal added that government policies should encourage private players.

PSIEC Chairman Gurpreet Bassi Gogi, when contacted, said PSIEC was a “no-profit, no-loss agency. “ Gogi said PSIEC arranged for the industrial plots land from farmers and sold it to the industrialists after creating the required infrastructure. He added that rates of the land went up after farmers approached court seeking enhancement in land rates. “Many such cases pertaining to districts like Ludhiana, Jalandhar and Patiala are still in courts and in the past PSIEC had to pay the enhanced rates on courts’ orders. Eventually, the burden falls on industrialists.”

Gogi admitted that industrialists were not showing interest in PSIEC Focal Points. Citing Raikot and Nabha where he said PSIEC had created adequate infrastructure, Gogi said industrialists were not coming forward to invest there. “For setting up dying industry on Tajpur road in 15 acres, we published advertisements seven to eight times. But no industrialist is willing to invest there. On the contrary, industry is coming up illegally in areas where Punjab Pollution Control Board (PPCB) should intervene and take action,” he added.

 

 

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