 | I am deeply conscious that the last two years have been difficult for
Indian industry in the context of growing integration with the world economy and the
inevitable uncertainties of the global market place. But we should also be proud of the
way Indian industry has surmounted difficult challenges and produced world-class winners
in a number of fields such as information technology and pharmaceuticals. The process of
corporate and industrial restructuring in the face of new challenges is inevitable. To
help this transition, I shall be announcing important tax initiatives to facilitate
corporate mergers and amalgamations. |
| The Industries (Development and Regulation) Act will be reviewed and
amended so that the primary focus is shifted to development of industry rather than its
regulation. |
| The Monopolies and Restrictive Trade Practices Act has become obsolete in
certain areas in the light of international economic developments relating to competition
laws. We need to shift our focus from curbing monopolies to promoting competition.
Government has decided to appoint a Committee to examine this range of issues and propose
a modern Competition Law suitable for our conditions. |
| The Prime Minister’s Advisory Council on Trade and Industry has made
important recommendations regarding knowledge-based industries. The pharmaceutical
industry is one of the important knowledge-based industries where we have comparative
advantage. We must strengthen our drug industry’s research and development
capabilities. Government has decided to set up two High Level Committees to review the
present drug policy so as to reduce the rigours of price controls where they have become
counter-productive and also to identify required support to Indian pharmaceutical
companies to undertake domestic R&D. My colleague, the Minister of Chemicals and
Fertilizers will be making a separate announcement regarding this initiative. Further, in
order to promote foreign direct investment in this sector, Government has decided to
permit up to 74% equity under the automatic route. |
| While we devote our attention to the new sunrise industries, we have not
neglected established industries like textiles, which employs 380 lakh workers and
accounts for about 20% of our manufacturing valued added. The Technology Upgradation Fund
Scheme has been approved by the Government and will become operational from April 1999.
For the next five years it will provide a substantial interest incentive of 5% on loans
availed by textile units from financial institutions and banks. It will cover weaving,
knitting, processing and finishing units, garment manufacturing, cotton ginning and
processing and the jute industry. The scheme is being extended to include the spinning
industry also. |
| In the National Agenda for Governance, my Government has already
proclaimed our commitment to the Handloom sector for providing services, technical and
marketing facilities for handloom weavers. In the area of marketing, I propose to
introduce a new integrated handloom promotion scheme, Deen Dayal Hathkargha Protshahan
Yojana which would encourage processing facilities, new design inputs to weavers and
opening new avenues for marketing of handloom fabrics. |
| Government has already undertaken important legislative and other reform
initiatives in key infrastructure sectors such as power, telecom, roads and ports. |
| The Sethusamudram Ship Canal Project will provide a shorter sea route
between the Eastern and the Western ports of our country. I propose to provide funds
during 1999-2000 to examine the techno-economic feasibility of this much awaited project. |
