NEW DELHI, March 8 — The Department of Development of North Eastern Region (DONER) has agreed to take up the issue of withdrawal of excise duty exemption with retrospective effect on petroleum products of the State’s four refineries with the Prime Minister’s Office (PMO) and Union Finance Ministry, State Industries Minister, Bhuba-neswar Kalita said here today. The minister was given this assurance by minister-in-charge of DONER, Dr CP Thakur when he called on him. Sri Kalita joined the chorus of protest over the budgetary proposals envisaging withdrawal of the exemptions with retrospective effect. The minister also handed over a memorandum signed by industries ministers of the north-eastern States on the issue.
Talking to this newspaper, he said passage of the proposal would be a major set back for the region, as a wrong signal would go to investors. ‘Right now I have with me investment proposals worth over Rs 200 crore. But if the concessions are withdrawn in the manner in which it is being done, I might as well say good-bye to these proposals,” he said. The State Industry Minister questioned the policy followed by the Central Government saying that if concessions were given only to be abruptly taken away, then there would be few takers for the special industrial policy for the North-east unveiled with much fanfare.
The past few days have not been good for the North-east. The gas cracker project is in a limbo, then came the Budget, which withdrew excise duty exemptions to petroleum products and certain other items and too with retrospective effect. Who will come to invest in Assam if he has to face the possibility of having the special concessions taken away by the Government,” he asked. The minister claimed that all those fly-by-night operators who misused the excise duty exemptions have vanished soon after the concessions were withdrawn barring a few who are still continuing. The pan masala manufacturers for one have stayed back and diversified their business into other areas despite the withdrawal of the exemptions. “Now that they also face the prospect of being penalised we fear that they may close shop for good,” he said. Sri Kalita also briefed the State’s MP about the impact of the budgetary proposals yesterday.
A day earlier the MPs belonging to the north-eastern region in their meeting with the Minister for DONER protested the move of the Finance Ministry demanding withdrawal of the proposal. They called for restoration of 100 per cent excise duty exemption on products manufactured by Numaligarh Refinery Limited (NRL). The concessions given to other refineries should also continue. The members under the aegis of the North East MPs Forum have also petitioned the Prime Minister in this regard.
Meanwhile, Sri Kalita called for intervention of the Prime Minister in resolving the last hurdle in implementation of the gas cracker project. The Central Government has committed itself to the project and now cannot go back on the issue of subsidy payment. “It was known since day one that the project would need subsidy, so why all the fuss now,” he asked, adding that a subsidy of Rs 377 crore was promised because it was felt that subsidy element was unavoidable.
As reported yesterday, the secretary-level meeting convened by the Ministry of Programme Implementation failed to resolve the feedstock issue. The meeting merely took stock of the position of the various Central ministries connected with Rs 3,700 crore project. The Ministry of Petroleum and Natural Gas and Ministry of Fertilizer and Petrochemical were sceptical about the viability of the project given the involvement of the huge subsidy component. The Central Government, which has committed supply of gas at a heavily subsidised rate of Rs 600 per 1000 SCM for 15 years.