State of the Economy 2018

Staying Put

Even as the tax holiday comes to an end, businesses in Pantnagar say better infrastructure will drive future investments and sustain the growth momentum

Barely two hours away from Nainital, Pantnagar came into existence on the country’s industrial map only around a decade and a half ago. Up until then, its only claim to fame was India’s first agricultural university, named after Govind Ballabh Pant, which was set up in the 1950’s. This town in the Terai belt saw the first signs of industrialisation only from 2003-04 onwards when the industrial tax holiday zone was set up. 

The State Infrastructure & Industrial Development Corporation of Uttaranchal (SIIDCUL) Integrated Industrial Estate offered a 10 year rebate on central excise duty and five years on income tax to companies to set up shop here which worked like a charm. Automotive giants like Tata, Bajaj, Ashok Leyland, Mahindra and several other big names from other sectors started manufacturing units here. However, even as the tax incentive is expiring for a bunch of companies, apart from a handful of smaller players in the pharma and electrical space, almost all the players have stayed on. For the final lot of companies that came in 2010, the tax exemption expires in 2020. With very little space left in the industrial zone, plans are on to develop new zones close by.  “We only have 65 acres available here now. We are developing new industrial areas in nearby Khurpia (13 km away) and Sitarganj (44 km away),” says Kamal Kishore Kafaltiya, regional manager, SIIDCUL (Pantnagar & Sitarganj).

Fresh Start
Five years ago, almost everyone was battling the downturn and sluggish demand. Today, the cluster seems to be in better shape with a turnaround in demand, although, with short-term hiccups related to structural reforms like GST. With the auto industry having one of its best years and with Pantnagar being home to almost all leading automotive majors, the mood is much more upbeat this time around.

Anil Mohgaonkar, who heads the Bajaj Auto plant in Pantnagar recalls how
Uttarakhand’s first chief minister ND Tiwari actively pursued and convinced vice-chairman Madhur Bajaj to

unsub

You don’t want to be left behind. Do you?

Our work is exclusively for discerning readers. To read our edgy stories and access our archives, you’ve to subscribe