The Telegraph
Since 1st March, 1999
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Govt faces incentive crunch

Calcutta, June 20: The government might fail to pay incentives it had promised to entrepreneurs because of its financial crisis.

The government has to make a cash payout to the investors who had availed the West Bengal Incentive Scheme 2000 and the West Bengal Industrial Development Corporation, through which the scheme was routed, is feeling the heat.

Managing director Gopal Krishna said as much at a meeting organised by the Bengal National Chamber of Commerce. “The earlier schemes dealt with deferment of sales tax and other related matters. There was no cash payout. But incentive scheme 2000 promises to return cash to the entrepreneurs,” Krishna said. According to the scheme, an entrepreneur is entitled to get back 15-25 per cent subsidy on capital investment. It also promises an interest subsidy, remission of stamp duty, electricity duty and other related subisidies.

“We have only Rs 15 crore in our coffer. Already, we have received claims worth Rs 11 crore under the scheme. Another Rs 40 crore (worth of) claims will be admitted soon. By the year-end, the claim should be nearly Rs 100 crore,” he added. Last year, the corporation had paid Rs 27 crore.

The incentive scheme has lured entrepreneurs to the state in the past couple of years and corporate watchers feel if the government fails to pay up, it will affect the flow of investments.

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