INDUSTRIES

The economic development of a nation or a region is generally determined by the level of its industrial development . Punjab which has done remarkably well in the field of agriculture is now well on its way to rapid industrialization through coordinated development of Small, Medium and Large scale industries. Punjab has a predominance of small-scale industry thanks to the indomitable spirit and entrepreneurial skills of Punjabis.0.2 million small scale industries and 600 large and medium scale industries functioning in the state involve fixed capital investment of Rs 54000 Million and Rs 20400 Million respectively.

Small-Scale Industries of Punjab

The aim of the paper is to study the performance of the small-scale sector of Punjab. Small-Scale Industries (SSIs) are significantly contributing to the economy of Punjab. In the liberalized era, the SSI sector is facing stiff competition from domestic as well as foreign companies. The paper outlines the year-wise growth trends in SSIs in terms of the number of units, employment generation, fixed investment, production and exports. The paper also shows a comparison of the SSI sector with the total industrial sector of Punjab. The new SSI units registration trends and district-wise distribution of units have also been highlighted here. The paper concludes that the position of the SSI sector is not very encouraging in the state. The main government institutions in the state are in a bad shape and are facing closure. Therefore, it is necessary for the government to provide infrastructure and incentives for the survival and growth of the SSIs.

Punjab Upbeat on Future of Signage Industry

It must be pointed out that the picture of what lies at regional levels of the Indian signage industry has been an unexplored treasure. However, in a weeklong trip across Chandigarh, Mohali, Amritsar, Jalandhar and Ludhiana, Sign & Graphics team navigates at length the contemporary setting of Punjabs signage industry. Predominated by printers at large, signage segment in the region glows its crystal ball gazing on brighter side of business. While the world cries economic slowdown and news of companies downsizing making headlines, some signage leaders of Punjab boast of being sheltered in a safe heaven pitching strategies for future growth. Jyaneswar Laishram reports how these leaders are responding to their contributions to make Punjab a sunshine corner of the countrys signage industry.

Big challenge ahead in Punjab

It has given no time to the new Chief Minister to rejoice in his victory in Punjab and laid a tough agenda for him within 48 hours of his taking the oath. The Captain, caught between debt and deficit, may be finding himself short of breath while Mr Hari Jaisingh, whose

deliberate attempt to highlight the Nisha Kaura case on the front page of The Tribune on the day of elections definitely swayed the masses in favour of the Congress, holds every right to demand faster development, a clean administration and good governance for the people of Punjab. While piloting the ship of Punjab, the priorities for the Captain will include four Ps progress of the state, power sector, peace and Patiala. This city has remained stagnant while Ludhiana, Jalandhar and Amritsar have shown tremendous progress after Independence. The Captain will succeed in sustaining a firm foothold in Patiala if he manages to provide a Chandigarh-Patiala rail link, widen the Patiala-Chandigarh highway, widen and deepen the Patiala nadi which has been afflicting Patiala again and again with floods and uplift the industrial status of this otherwise beautiful city. The hard-earned peace in Punjab will have to be maintained under all circumstances. The power sector will have to be assigned top priority by minimising theft and losses and having new projects in the state as everything today has become dependent on power. Progress of the state will demand special emphasis on civic amenities and industrial growth with an eye on the IT sector. Achieving all this with a whopping deficit staring in the face might be a herculean task for the new Chief Minister. Firm determination and persistence coupled with clean and austere measures will certainly pay.

Although economic growth remained subdued in the country during 2009, Punjab had to face some additional handicaps that could have been avoided had the provincial government pleaded its case with the federal government. The Punjab economy had to face multiple problems during the year as its industries lost 77 days of production in 2009 on account of acute gas shortage hurting export-oriented industries, resulting in loss of thousands of jobs. It is pertinent to note that the gas pipeline company supplying gas in Sindh has surplus gas that could have easily been diverted to the gas-distribution system in Punjab, had the provincial government taken up the matter with the federal government. The trade and industry pleaded its case with the federal government but, despite instruction by the federal cabinet, 200 mmcfd gas from the Sui Southern Gas Company was not supplied in the Sui Northern Gas Pipeline System. The gas and electricity shortages hit the province at a time when the global economy was in recession and the terrorist activities were at peak. The gas shortage also impacted the industries producing goods for domestic markets. All these industries produce electricity from natural gas not only because the cost of electricity production is low but also because there is acute shortage of electricity in the country. Producing electricity from alternate fuels like furnace oil and diesel is 8-10 times more expensive. Since over 70 per cent of the textile industry of the country is located in Punjab, it lost exports worth $2.5 billion in 2009 as the gas supplies to the industries remained suspended for over 60 days. The sports goods industries and the engineering sector also suffered badly, loosing not only export market but some of the domestic market to import goods and supplies from Sindh based industries.

The industrialization process came to a standstill as a result of power and energy shortages. The car manufacturers, mostly located in Karachi and its suburbs, pressed the Punjab-based vendors to open their plants in Sindh for efficient supply of component. This put an end to any expansion process in the province, resulting in relocation of some auto-vending industries in Karachi. There was no progress in Sundar Industrial Estate as new projects were suspended due to lack of power and energy. There was no progress in many new industrial estates being developed in the province, particularly, the one being built in Faisalabad. Industries in Sindh did not face gas shortage which enabled them to produce their own electric power at lower rates.
The overall industrial growth rate has declined to 7 per cent in April as against 11 per cent in the same month a year ago, according to the Index of Industrial Production (IIP) data released here today. The growth was pulled down in April 2008 as manufacturing growth was a dismal 7.5 per cent as compared to April 2007 when the growth was at 12.4 per cent. The concern remains over the manufacturing sector that has been dragged down due to negative growth of textiles, food products and engineering industry .The decline has been mainly on account of poor showing by manufacturing and electricity sectors, say economists, as the effects of fuel prices and inflation are showing on the manufacturing sector. We expected the IIP to be weaker as the economy is clearly slowing down. But compared to the last 3 per cent industrial growth, the 7 per cent figure gives us some reassurance that though the economic growth will slowdown but it will not be as severe as it seemed, S&P chief economist Subir Gokarn said. The stock markets seemed charged up after the IIP data was released with the benchmark Sensex, which was down by over 400 points in morning trade, recovered to end the day higher by over 60 points at 15,250. Attributing the reason for slowdown to high interest rates and increasing input costs, CRISIL principal economist D. K. Joshi said the average industrial growth during 2008-09 was likely to be around 7 per cent. While the growth in manufacturing and electricity sectors dipped in the month, mining posted a robust growth. The electricity generation also saw a steep fall to 1.4 per cent against 8.7 per cent during the same month last year. The mining sector, however, posted an impressive show of 8.6 per cent growth, up from 2.6 per cent. Over 45 percent of punjab people still live in poverty with almost half of them belonging to the Scheduled Tribes, most of whom live in remote villages with little migration to the cities. There are large gaps in the delivery of basic services. The state still has large untapped potential for economic growth. Improved transport and power connectivity: Almost half the villages in punjab are small and isolated with less than 500 residents. As geographical isolation poses a big challenge for connectivity, adequate

road, rail, and port infrastructure is essential for inclusive growth as well as to benefit from the states mineral endowments. Urban infrastructure: Although Punjab has one of Indias lowest levels of urbanization 15% its urban centers are growing rapidly. With the growing advent of industry, tourism and IT services, the demand for urban housing, water and power services is likely to increase many times over. Massive upgrading of urban infrastructure is therefore needed to attract and retain the skilled labor force demanded by modern industry and services. Agricultural and forestry growth: While some 85% of the states population remains dependent on agriculture, fisheries and forestry, these sectors are beset by low yields, excessive middlemen, poor connectivity, and lack of storage facilities. The ban on land leasing has resulted in informal and illegal share-cropping arrangements that are harmful to cultivators. To improve the rates of return from farming, the state has amended the agricultural products marketing act to permit privately run mandis and contract farming. The computerization of land records is ongoing. Yet, reforms in land tenure and land administration are needed so that small farmers can access bank credit and make productive investments in the land. For the mostly tribal populations that are dependent on forest produce, joint forest management practices can be a promising route to higher incomes. Education: While school enrollment has risen, learning levels remain very low. While the state government has launched bold measures to improve teacher accountability, strong educational fundamentals from the earliest years, supplemented by some public and mostly private efforts in training and skill development are needed. Health: Despite dramatic improvements in overall infant mortality rates in the past 510 years, the predominantly tribal districts lag behind. They have the poorest immunization rates and least access to antenatal care. While the state governments health sector plan for 2005 envisages a decentralized and participatory approach to service delivery, innovative and flexible approaches will be required to reach geographically isolated villages. Importantly, systems of accountability will need to be strengthened before budget allocations to education, healthcare, and anti-poverty programs are increased. Small and Medium Enterprises: With the arrival of new mega projects, the demand for a wide range of goods and services will rise, generating opportunities for small investors as well as new avenues for employment. To capitalize on these opportunities, an improved regulatory climate for SMEs is called for.

Historically, Punjab has grown at a higher pace than the rest of the country. In ten years, from 1991-92 to 2001-02, Punjab posted a GDP growth of 4.5 while the national GDP growth rate was 4.1 per cent. Without Punjab the growth rate was 3.6 per cent. But, during the years when the growth in Punjab was less, it impacted the overall growth of the economy.

Electricity Problem
It has noted that the Grid Corporation which buys power from producers and sells to distribution companies has suffered huge losses and by the end of year 2009-10 the loss may well surpass 1,500 crore rupees. While the loss to Gridco is true, not many people know that the loss was to a large extent an outcome of very low power supply from P.S.E.B , the state owned corporation that owns
hydro-power units in Punjab.

ADVANTAGES High quality of life, leader in e-readiness, pro-active Government and a large nucleus of it majors. Cheap land, abundant power, low cost and efficient connectivity; has visibility as a tourism hub. Low-cost, English-speaking skilled manpower; highquality infrastructure in power; good air connectivity. Large talent pool and good basic infrastructure. it parks at Hinjewadi and Talawadi offer excellent facilities. Good physical resources and abundant real estate. The Infopark offers state-of-theart infrastructure. A traditionally strong industrial, engineering and shipping base. Land concessions for IT-ites units. A traditionally strong industrial, engineering and shipping base. Land concessions for IT-ites units. DISADVANTAGES Plans to upgrade infrastructure on drawing board; poor connectivity in the absence of a world-class airport. No major it company has set up its operations, small size of talent pool and inadequate

infrastructure.

Skilled manpower still inadequate; poor public transport and lack of a single window for government clearances. High cost of real estate. Lack of investments in convention centres. Water supply is inadequate in some areas. Slow pace of development of ITEs-BPO parks. Lack of a single window for government clearances. Inadequate IT skilled manpower, poor road connectivity and insufficient power supply.