A new hope for small-scale industry in Bangalore

A new hope for small-scale industry in Bangalore
Financial Express

BANGALORE: Peenya Industrial Estate in Bangalore, considered to be the biggest in South East Asia with about 4000 units constructed for the small scale industries, is finding a new hope of life with MNCs setting up their base in Bangalore.


The industrial area that was built by Karnataka Small Scale Industries Development Corporation (KSSIDC) in the ’70s, was on the verge of extinction due to various government policies and infrastructure issues. “Most of the small-scale units being ancillary units of state PSUs like Mysore Lamps or NGEF, had to close their shop, as their parent companies themselves were on the verge of closure. So far, more than 600 to 1000 companies have closed their factories,” said Prakash N Raikar, General Secretary, Karnataka Small Scale Industries Association (KASSIA).

Another reason adding to the crisis was the infrastructure problem. Due to negligence on part of the government, with all the concessions withdrawn and little attention being paid to infrastructure facilities such as road, water and electricity, output of the industries in Peenya had been declining. “In the last couple of years, things have improved. Earlier we use to get electricity only for six to seven hours in a day. Mostly, we were dependent on generators,” said a SSI unit owner in Peenya.

With MNCs coming to Bangalore, SSI units in Peenya are hoping to benefit. “Most of the engineering companies in Peenya have started supplying components to automobile companies like Toyota, Volvo, Timken, BFW, Kennametal etc. These units are running in profits,” said Mr Raikar. Another major development in the last few years was an increase in the number of garment units. “Large garment companies have started sourcing from the smaller units situated in Peenya,” he said.

Though there is a improvement in the situation, the government has not yet changed its policy while taxing small-scale industries. “If a manufacturer in the state manufactures a component and sells it to a local trader, he has to pay 12.5% tax with a cess. If the trader imports it from another state, he has to pay only 4% tax. Such a policy will affect manufacturing units,” said Mr. Raikar.

“There is no township in Peenya. Due to this, we don’t have an elective member to represent us. We have requested the state government to develop a township for the residential purposes of the industry workers,” said Srikantadutta, secretary, Peenya Industries Association. The state government has already directed the local authorities to consider the industrial area as Peenya Township Authority and directed the industries association to elect a member to the assembly.

For solid waste management, the state pollution control board has constructed a solid and hazardous waste disposal plant near Peenya for the benefit of the industries.