Page 49 - Plastics Nuews October 2017

BuSINESS NEWS

Odisha may lower SGST to attract industry

he Odisha government is Centre and State. In response to a query on how this
Tconsidering incentives on the incentive would shape up once petroleum products are
State Goods and Services Tax (SGST) brought under GST, Chopra said: “We will cross the bridge
component to encourage setting up when we come to it.”
of manufacturing centres.“In terms
of fiscal incentives, earlier the State
governments used to offer Value India's PET bottle recycling
Added Tax (VAT) reimbursement market worth US$ 35 billion
on new investments in priority
sectors. Some State governments
are mulling how to continue it under th GST regime, and early 70% of polyethylene terephthalate bottles
so is Odisha,” said Sanjeev Chopra, Principal Secretary, Nare recycled in India, and the market is worth
State Industries Department .” “We hope to finalise some an estimated 3500 crore rupees (US$ 35 billion) per
broad understanding on this within the next month or so,” year, according to a new report by the country's
he added. Based on focus sectors, Chopra said Odisha National Chemical Laboratory. Some 900 000 tonnes
was trying to assess the impact of giving or not giving of polyethylene terephthalate (PET) is produced
incentives. Broadly, the leeway that the State governments annually in India, 65% of which is recycled at registered
have is with respect to the SGST, he explained. Focus facilities. At least 15% of recycling activity takes place
or priority sector for Odisha includes ancillary and
downstream industry in the metal sector; chemicals;
plastics and petrochemicals; electronics manufacturing;
food processing, including seafood; textiles, apparel and
tourism, according to an official statement.

“Some units have come up based on the commitments in
the Odisha Industrial Policy Resolution, 2015. It will be
unfair for the State government to back out completely
on that commitment. We have a provision in the Industrial
Policy that we will make suitable changes in the policy as
an when the GST regime kicked in,” Chopra said. “Now
that it has happened, the State government is deliberating
on how to move to a more finely tuned regime for SGST
reimbursement,” he added. within the country’s so-called ‘unorganised sector’
while approximately 10% of PET is reused in homes, the
According to an earlier report in BusinessLine area-based
excise exemptions given to the industry by the North- National Chemical Laboratory indicates. The research
Eastern and hill States, including Uttarakhand, Himachal was commissioned by the PET Packaging Association
Pradesh and Jammu and Kashmir, will shrink considerably for Clean Environment in 2016 in order to arrive at
under the GST regime. Though the Cabinet Committee on a deeper and ‘robust’ understanding of end-of-life
Economic Affairs has extended the area-based tax breaks plastics across India, specifically PET bottles.
for residual 10 years in August, this was largely limited Plastic recycling is the process of recovering scrap
to hilly states. On whether new projects in the State or waste plastic and reprocessing the material into
can expect such incentives, Chopra said: “Since there useful products. Since the vast majority of plastic is
is no VAT now, whatever policy we define will apply to non-biodegradable, recycling is a part of global efforts
both existing and new units.” Odisha was in the limelight to reduce plastic in the waste stream, especially the
recently after it decided to withdraw a VAT deferment to approximately eight million metric tonnes of waste
Indian Oil’s Paradip Refinery in February this year. This plastic that enter the Earth's ocean every year. This
incentive was restored in August after talks between the helps to reduce the high rates of plastic pollution.

49 Octob er 2017 | Plastics News