Himachal’s road to Industrialization- A myopic vision?


By: Karan Kapila

Contemplating to the recent past, Himachal Pradesh appears to have emerged as among the most vibrant states in the Republic of India. The hill state boasts of a thriving economy largely dependent on agriculture, horticulture, tourism, handicrafts and hydro electric resources, with agriculture constituting a major stake. Today, Himachal ranks first in context to attaining the objective of having a bank account for every family and positioned as fourth for high literacy rate and per capita income in the country.

It is apparent that industrialization plays a dominant role to propel an economy. For the last one decade, industrial reforms by the government of Himachal Pradesh has opened new vistas for the. To give a platform for accelerating industrial growth and employment, the government has developed 16 industrial areas, 11 export promotion parks and 11 industrial estates. Furthermore, to stimulate this industrialization initiative with assistance from central government, Himachal government has strategically selected the option of establishing Special Economic Zones (SEZs). Under this scheme, the government has developed SEZs in district Solan, Una and Kangra. To attract investments in these SEZs, government has injected lucrative benefits in the form of excise, tax and other subsidies. This initiative has worked as a magnate to attract investment in billions for the hill state.

However, if we observe the investment scenario in Himachal Pradesh, district Solan, Una, Kangra and Sirmaur have surfaced as a favored destinations for industrial investment, since it is apparent that these districts share borders with neighboring states, considerably important for transportation and liaison.

Among these preferential destinations, Solan and Sirmaur hold a pivotal position in captivating interest of investors. All major Pharmaceutical, IT and Manufacturing companies have established their manufacturing units in Baddi, Barotiwala, Parwanoo and Kala Amb. Whereas district Una and Kangra are still combating hard to attract potential investors. If we review Himachal’s scenario on industrial investment, modest interest has been shown by capitalists on industrial areas identified in district Una and Kangra.

It is evident that industrial areas in district Una and Kangra also boast similar facilities if compared with district Solan and Sirmaur industrial sites. Industrial area in Tahliwal, Gagret, Amb and Mehatpur in district Una and Sansarpur in district Kangra are well connected with roads and rail approach. Besides, these industrial sites have close proximity to neighboring Punjab and significantly boast attractive benefits in the form of tax and other subsidies from government. Apparently, they still lack in attracting potential investors.

It is noticeable that the reason behind district Solan’s emergence as favorite destination for investment is the promotion of its industrial sites by the ministry of commerce, Government of India. Moreover, in context to investment, Himachal government also priorities Solan and Sirmaur. It is a fact that whenever a company intends to invest in Himachal Pradesh, Solan and Sirmaur are portrayed as prominent locations. Does it signify that district Solan and Sirmaur only have the potential as an industrial hub? What about the industrial sites of district Kangra and Una? Is our government reluctant to develop these sites? It seems apparent that the government of Himachal Pradesh is not giving due consideration to raise the profile of industrial sites in these districts. In past years, many proposals have come for lucrative investments in these districts but they are somewhat lost in government files or are diverted to Solan and Sirmaur. If due consideration is given, industrial areas of neglected Una and Kangra can be significantly promoted to attract investments. The endorsement of Una and Kangra as favourable investment destinations can bring high proceeds for the state with complementary employment benefits for local people and subsequently it will magnify the image of Himachal Pradesh as an attractive destination for investment on global podium.

Accordingly, the government of Himachal Pradesh should not constraint itself towards development of particular region; rather it should take an overall growth approach. For the industrial development of the state, it is exceptionally vital to promote all industrial areas in a similar manner to attain inclusive and swift growth.

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