Attracting investors with incentives
Punjab is an opportune state for investment in food processing sector as it is home to food processing units, agri-export zones, mega food parks and cold chain projects. And now the state government has mooted a proposal to set up a food processing university on the lines of National Institute of Food Technology Entrepreneurship and Management. Considering Punjab as a food basket of India; Sukhbir Singh Badal talks about opportunities available for overseas investors, giving example of ITC, which is setting up Food Park in Kapurthala. In addition, he outlines the schemes and incentives planned for investors.
Let’s start with food processing which is a major focus area of India and Punjab as well. Could you please tell us what are the opportunities for overseas investors in businesses in terms of food processing in Punjab?
See, Punjab is a food basket of India. Though we have 22 per cent of the land area, we provide more than 50 per cent of the food requirement of the country. Farmers in Punjab are very progressive. They like to innovate and are very hard-working. Punjab on being border to Pakistan, there is trade opening. A lot of demand is there. So I personally believe, this is a right place. We have a very good infrastructure. It is internationally connected. We have two airports – one is already operational and second international airport will be operational very shortly. We are power surplus state. We have the best road network. In another 6-8 months, every part of Punjab, every village will get better connectivity of roads. We have the best infrastructure in the country. We offer lot of incentives for investment in these areas. We have an organisation called ‘Invest Punjab’, where we have a CEO. All powers of every department are vested in that person. So, you don’t have to go anywhere for any clearance. You just have to go to one man and within a stipulate timeframe; you will get everything in your hand – all clearances, incentives, permissions. We have a very attractive incentive – like if you produce and manufacture in Punjab, whatever you sell in Punjab, the value-added tax which you cover, 70-80 per cent depends upon on your investment size. You retain it with yourself as a subsidy from our state and the balance sheet, you return to the state government. That if you calculate alone, will make your project free in 6-7 years or may be before.
Have these incentives attracted overseas investors or the Indian investors?
A lot of investors in this scheme have been operational for the last 4-5 months. We have got almost 96 companies, who are already availed of our department. All of them are now in operational mode. They are in the construction stage.
Since food processing is quite vast sector, so could you please tell a bit more in detail about exactly which part of this industry would be an opportunity for Punjab?
I think, anything to do with wheat, rice, fruits and vegetables – we are the best place. We are a big player in fruit and we grow a lot of vegetables too.
Could you please give some examples of investment?
ITC, one of the biggest companies, has been setting up their biggest park of the international standard in Kapurthala. They are starting construction and they are spending nearly Rs 10 billion on it.
How do you want to communicate these things about Punjab – richness, incentives to overseas investors?
I am doing personal meetings. I am going to locations to have one-to-one meetings with the major players. Also through website and all modes of communication, we are trying to reach out to the potential investors.
Organics is a major emerging segment in Europe. The organic options are in abundance. How has been the situation in Punjab?
I think, there is lot of people who are moving towards organic and there are some players who are ready to buy the product. Farmers of Punjab are ready to experiment.
So, currently it is not the focus area.
No. The focus area means for organic, you need the buyers; so if some big company is ready for an entry, then they (farmers) can do contract farming for it.