Key sectors such as real estate, power, steel, gems and jewellery require sops for industrial revival, Assocham said on Friday.
The industry body has sought special dispensations for the sectors by way of cut in excise duty along with measures such as teaser loans for the housing sectors, it said in a statement.
“The RBI, banks, States and the Centre should move fast in taking the troubled power discoms out of morass, or else they would become dead assets and big drags on the exchequer,” Assocham stated. The average industry capacity utilisation is 77 per cent and unless this reaches at least 100 per cent, one cannot expect the investment cycle to revive even though interest rates have come down, said Assocham Secretary General DS Rawat.
“For creating additional demand, the government will have to take bold measures and create extra elbow room for the select industries by way of extending short tenure stimulus on construction material like steel, cement, power equipment while for the gems and jewellery, export sops like interest subvention must seriously be considered,” Rawat added.
Growth pick-up Once the growth cycle gathers steam and becomes stable, the special window can be closed gradually, he said, adding that under the given circumstances, lower interest alone would not help because the issue is not high cost of investment, but lack of demand.