Trade, industry in Jammu fears major losses on account of floods; CCI to demand special package from CM
There is despair among the major traders, and industrialists in Jammu especially those dealing with businessmen in Kashmir valley where life is totally suspended due to the floods. Although there is great trust between the trading community in Jammu, Kashmir and Ladakh but still fear is being expressed that trade will heavily suffer because it is unlikely the businesses in Kashmir would be able to make timely payments. Some of the them fear that credit they extended to business in Kashmir might be wiped as large number of traders in Valley have suffered massive losses. The major losses would incur on account of the fact that huge amount of working capital will be blocked as payments do not come in time or some might have to be written off. Several hundred crore is likely to be blocked as working capital, advance payments for goods, and VAT refund. Traders cite that almost 500 crore would be blocked in the trade cycle due to the disaster in Kashmir valley as well as other parts of the state.
It is in view of this massive losses staring at them, the trade and industry bodies of Jammu have approached the central government to consider their demands on priority while preparing relief package for the flood affected J&K. The traders say that that their working capital is blocked, they cant pay bank loans,and in such a situation the government must come to the rescue of the businessmen. Notably, industrialists from Jammu, Kathua and Samba are the major suppliers of various items to Kashmir Valley, and have huge stake in Kashmir as it is a major market for the local industry. Sources tell that if local industrialists and traders are not supported by the government then many could shut down, and this would be a major blow to the economic stability, and employment in the Jammu region.
Rakesh Gupta, president, Jammu Chamber of Commerce and Industry, says that they are planning to set up a unified group including businessmen and industrialists from all parts of the state, and meet the Governor and Prime Minister. “We want that this flood situation should be declared a national calamity, and appropriate relief and compensation should be given to the people in the state”, says Gupta. He has also criticizes the statements in media by some government functionaries that compensation to businessmen should be paid by insurance companies. The CCI will demand that government should declare income tax holiday for two years, restore excise benefits which were withdrawn in 2008, and defer payment of VAT.
The industry bodies further says that the state government, and industries department should immediately set up a committee to assess the damages on account of floods, and blockade of capital and goods which were on way to Kashmir, and for which payments have not been made. This assessment should be submitted to the central government for consideration of compensation and relief package to the traders in Jammu. Apart from this central government should come out with a special package for the industry in Jammu so that it is able to run operations in this difficult hour in the aftermath of floods. With situation in Kashmir unlikely to return to normalcy in the next six months the trade bodies have also called for special measures to be taken by the government and banks which includes an interest free period for loans for the next six month on loans, postponement of advancement income tax payments, liberal terms of loans from banks, waiving off of the term loans, extending central excise package of incentives that existed before 2008, IT holiday for five years, and compensation to Jammu industry which has suffered losses. The trade and industry in Jammu has been crucial in ensuring that finances of the state of Jammu and Kashmir are stable as they pay huge sums in taxes, and provide employement to thousands of people, keeping this in view it is important that government should come to the rescue of those who contributed in such a major way.