UP Industry Raps Mayawati Govt for Utter Neglect, Tall Promises

“We feel like the abandoned and battered orphan Baby Falak as the

all-powerful Chief Minister of Uttar Pradesh could not find time even

once during her five year long tenure to meet representatives of the 3

million micro, small and medium enterprises in the state that provide

direct employment to more than 6 million people and livelihoods to over

30 million people,” said Mr V.K. Agarwal, president of the Delhi-based

Federation of Indian Micro and Small & Medium Enterprises (FISME),

an industrial lobby representing the nearly 30 million strong MSME

sector which provides direct employment to more than 70 million people,

the second-largest employment provider in the country after agriculture.

“With just a few good officers remaining in the state, but acting

apathetically in the absence of any political direction, the small and

medium industry in the state just does not know what to do next,” Mr

Agarwal said.

“Industries that could afford it, have already moved out of UP and

many are likely to follow suit as they are increasingly becoming

unviable in many sectors due to such utter negligence and complete

indifference towards the needs of industry,” he said.

“The state PSUs such as Uttar Pradesh Power Corporation Limited

(UPPCL) and others take pride in closing their doors to state

industries and prefer sourcing goods and services from across the UP

borders. While the National Rural Health Mission (NRHM) scam has come

to light, there are similar skeletons in the cupboard of many

departments including power, industry, education and urban

development,” he said.

For example, capital goods like machinery, transformers and several

industrial inputs like duplex board etc. have to suffer VAT @13.5%

against CST @ 0 to 2% in other States.

“In comparison, states in India such as Rajasthan, Tamil Nadu,

Gujarat among others, have erected barriers to protect and promote

their own manufacturing base,” he said.

“Despite a lot of lip service by successive governments both at the

centre and the states and enactment of special legislation such as the

MSMED Act, 2006, the ground reality is that the status of the Indian

MSME sector is worse than that of an abandoned orphan,” Agarwal said.

“Even at the centre, the finance minister has discontinued the

practice of meeting representatives of MSMEs in pre-budget

consultations although if India has to achieve a contribution of 25%

from the manufacturing sector in its GDP, as is the government's stated

goal, it simply cannot be done by ignoring the MSME sector,” he said.

“We keep comparing ourselves to China but that country has become a

manufacturing powerhouse only because of the importance that their

government accords to the small and medium sector,” Mr Agarwal said.

He said FISME is of the view that political parties despite their

tall promises have not really addressed the question of from where the

'promised' jobs will come. “It seems their idle utterances are based on

the premise that like all their earlier promises, the electorate in due

course will forget the present promises as well,” he said.

The politicians, however, are failing to recognize the frustration

that the people of Uttar Pradesh have started feeling as the gap widens

between the socio-economic levels in UP and the fast developing states

like Gujarat, AP, Tamil Nadu etc. The stark contrast on all

socio-economic parameters with their fellow citizens in emerging states

like Bihar is only adding insult to injury, Mr Agarwal said. 

FISME members in UP are watching with their fingers crossed if the

new government and the upcoming breed of some young and educated

leaders in different political parties will remain as distant to small

industries as their predecessors.

Perhaps the leaders in different political parties need to fast

appreciate that 'demographic dividend' in the coming decade can turn

into 'demographic disaster' when the millions of young people being

added to the workforce find themselves without jobs that can provide

them livelihoods.

There is just one choice and one choice alone before the country to

meet the grave challenge of employment and that is to make sure that

the manufacturing sector develops in adequate measure in line with the

recommendations of every economic forum including the Planning

Commission that finds manufacturing to be the fountain-head of new jobs

in the coming decades. If this is to happen, FISME feels the next

government in Uttar Pradesh has to actively engage with manufacturing

MSMEs on an ongoing basis.