Ease of doing business: Industries to get 3-yr window for approvals in Karnataka

Industrialists looking to set up ventures in Karnataka can commence work immediately after their proposals are approved by the government, without having to wait for any other clearances.

Industries will be given three years’ time during which they can seek clearances from all other departments, the Cabinet decided on Thursday.

Calling it a "historic" move, Industries Minister Jagadish Shettar said the government will amend the Karnataka Industrial Facilitation Act, 2002, for this. “We wanted to ensure ease of doing business and hence, this amendment. Karnataka will be the third state after Gujarat and Rajasthan to set up this model for clearance of applications. Even in these states, it is applicable only to small and medium-scale industries. Our amendment will be applicable to all industries,” he said, adding that an ordinance will be promulgated.

New procedure

An entrepreneur will simply apply online on the Karnataka Udyog Mitra portal by filing an investor memorandum. From there, the application will undergo scrutiny through the land audit committee, after which it will be scrutinised by either the district or the state-level committee.

For investments below Rs 15 crore, permission will be given by the district-level committee concerned. For projects between Rs 15 crore and Rs 500 crore, the state-level Single Window Clearance Committee (SLSWCC) chaired by the minister concerned will process the application. For those above Rs 500 crore, the State High Level Clearance Committee (SHLCC) chaired by the chief minister will decide.

As per the proposed amendment, once an investor gets the acknowledgement of approval from any of these committees, he/she can start the operations without waiting for clearance from other departments, such as the Karnataka State Pollution Control Board, or building plan approval.

However, these clearances will still be mandatory. “Within three years, the industrial establishment has to show productivity and get other clearances,” Law Minister J C Madhuswamy said.

The decision to amend the Industrial Facilitation Act follows a recent spate of other amendments to multiple legislation by the state government. In March, the state government had amended Section 109 of the Land Reforms Act, making it easier for conversion of agricultural land to industrial purposes. Recently, the government made another amendment to the same legislation, allowing non-agriculturists to own agricultural land.