Red-tape hinders growth but GST has helped Ankleshwar SMEs

The town in the Bharuch Lok Sabha constituency has around 1,800 units, most of them related to chemical production, employing around 1.25 lakh people, according to industry sources

Red-tape hinders growth but GST has helped Ankleshwar SMEs

Ankleshwar (Guj): The first thing that hits you when you enter Gujarat's industrial hub of Ankleshwar town is the pungent smell of various chemicals, a lingering reminder that the pollution tainted small industries sector will play a key role in electoral victory. The town in the Bharuch Lok Sabha constituency has around 1,800 units, most of them related to chemical production, employing around 1.25 lakh people, according to industry sources.

Many unit owners in Ankleshwar, declared a "critically polluted zone" from 2010 to 2016, have a string of complaints against the bureaucratic hurdles in the way of their profit margins. The owner of a pharmaceutical SME (small and medium enterprise) said on the condition of anonymity that units in the Ankleshwar industrial hub find it difficult to get clearances from the central or state government due to environmental concerns. However, the Goods and Services Tax (GST) regime, unwelcomed by many Gujarati business persons in other sectors such as textiles, receives good reviews from the SMEs sector here.

"GST to us is even bigger than god. All the rounds that we had to make earlier of government offices each month to submit documents have stopped completely now. The process under GST is completely online," Dinesh Patel, managing director, Daxesh Petrochem, told PTI. The BJP is fielding five-time Lok Sabha MP Mansukhbhai Vasava against Congress' relatively unknown Sher Khan Pathan and party workers say goodwill from the SMEs will see them through. It's not going to be easy though with red-tapism continuing to be a major issue.

Take the case of Baldevbhai Prajapati, who runs two small pharmaceutical companies - Rajesh Pharmaceuticals and Gopsi Pharma ¿ with a total turnover of around Rs 5 crore per year. Prajapati said he put in an application to the Gujarat State Pollution Control Board (GPCB) eight months ago to increase drug production at his two companies from 5,000 kg to 20,000 kg. "I received permission to produce 5,000 kg in 2000... My plants have zero discharge of effluents. But if I start producing even 500 kg more than permitted, I will get the notice for closure," Prajapati said. "There is a rule that says that the company will get permission within one month. But the department then raises queries, that so and so document has not been given. Once this happens, the time limit keeps increasing," he added.

There is a reason for Prajapati's insistence on getting quick permission to increase production. China, which supplied almost 80 per cent of India's requirement of drug intermediates and Active Pharmaceutical Ingredients (APIs) till 2017, has severely curtailed production since then due to environmental concerns. This gives an opportunity to small players like Prajapati to maximise their revenues. "If I increase my production to 20,000 kg, I will be able to employ double the number of people I currently have in my two companies," he said. He currently employs 10 people in each of his two companies. Despite his problems, he said his vote will go to the BJP. Prajapati's problems find wide echo in the town.

"Companies that have plants in industrial hubs in Jhagadia and Dahej gets clearances way more easily. But the businessmen believe the BJP government will do more for them any day as compared to Congress," the owner of a unit here said, requesting that he not be identified. The industrial hubs of Jhagadia and Dahej fall in the Bharuch constituency, which goes to the polls on April 23 along with the rest of the state. According to a managing director of a chemical company, Congress' Sher Khan is not very well known here. He also complains about the bureaucratic red-tapism.

"To use methanol, I have to get two kinds of permission from prohibition department. Then, I have to collect a 'poison license' from district collectorate. For poison licence, I need to get a no-objection certificate from police and I need to arrange a visit from sub-divisional magistrate," he said on the condition of anonymity. Despite his own problems, he believes Prime Minister Narendra Modi is "on the right path" and bureaucrats don't give him the right picture. According to him, Mansukhbhai has been listening to their problems sympathetically for many years and has been "extremely sympathetic".

"Mansukhbhai is trying to resolve them one by one. He has been Lok Sabha MP for five terms now. He has a lot of experience," he says. Bharuch has total 15.64 lakh voters, and a sizeable number of them belong to Muslim community and tribal communities. Bhartiya Tribal Party (BTP) leader Chhotubhai Vasava has also filed his nomination from Bharuch. The Congress and the BTP had conducted some discussions to field a single candidate. When the talks failed, the Congress fielded Pathan while BTP leader Chhotubhai submitted his own nomination.

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