GIDC: No longer industry bedrock

GIDC clusters across Gujarat are considered the backbone of small industries in Gujarat. However, over the last two years the situation has turned for the worst for units operating here. As many as 311 units have closed in GIDC estates in 19 districts of Gujarat.

Surat seems to be worst-hit. Here, 101 units have closed in last two years. Mirror collated details from replies filed in the Gujarat Assembly for questions raised pertaining to GIDC operations.

After Surat, Ahmedabad, Vadodara, Surat, Kutch, Bhavnagar, Sabarkantha and Navsari are the worst-affected. According to data furnished in the tabled replies, 35 units closed down in Bharuch, Porbandar (31), Vadodara (23), Kutch (19), Banaskantha (10), Amreli (7), Bhavnagar (15), Aravalli (7), Ahmedabad (16) and Panchamahal (12). All these units closed in the last two years.

When asked about such a high rate of closure, GCCI President Jaimin Vasa said, “There could be several reasons. One, may be these units shifted to other states because of better tax benefits and schemes. Second, there is the practice of retaining the space of the older unit despite opening a bigger second elsewhere. It is not that these units are sick.”

Ajit Shah, President of Sanand GIDC, told Mirror, “While there are units in Sanand GIDC that have winded up operations, about 400 have moved out and relocated because of the revised policies that made it difficult for them to work with ease.” He added that most units have moved to private plots as they believe it is easy to do business on private plots.

Shah, who also happens to be the vice-president of Federation of Industries and Associations of Gujarat said, “The situation is more or less the same across Gujarat. The main reason is lack of infrastructure in and around GIDC.”

Ankit Patel, who runs a manufacturing unit, said, “Lack of water treatment plants for industries in older GIDCs and high cost of transport faced by micro units are two other reasons behind so many units shutting down in GIDCs.”

Himmat B Padshala, one of the directors of GIDC, said, “We have over 33,000 units, out of which about 300 have shut down. But there could be several reasons for it. I am sure there is no policy or GIDC-related issue. We support units in several ways if they have a problem. But the reason for closure could be personal; they may have started it in haste and may have failed.”

Pointing to lacunae in the system, former GCCI president Bipin Patel said, “MSMEs have a number of issues. At the same time they contribute significantly to the nation’s GDP. The State government is not interested in listening to problems or finding solutions.

When I was president of GCCI, we had gathered information from all GIDCs and found that over 50,000 units were dysfunctional. We submitted a detailed report printed in the form of a book and submitted it to the government with solutions and schemes that could be implemented.”

He added that the then Chief Minister, Anandiben Patel, conducted a couple of meetings. “Nearly 5,000 MSME businessmen had once gathered at Mahatma Mandir for the meeting. But nothing moved after c h a n g e o f g o v e r n m e n t .

Demonetisation and GST could also be among the key reasons for shutting down of the MSMEs. The impact of GST and DeMo is still prevalent and creating more trouble in business nowadays,” he said.

Balvantsinh Rajput, chairman of GIDC, and D Thara, vice-chairman and managing director of the corporation, could not be contacted despite repeated attempts.