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Union minister questions Centre's $2 billion subsidy for US company

Union minister questions Centres $2 billion subsidy for US company

Karnataka JD (S) Leader, HD Kumaraswamy

New Delhi: In the matter of the Centre allowing investments by a United States-based semiconductor manufacturer and allocating Rs 3.2 crore in subsidies to the company in return for creating every job it creates, it was questioned by Union Minister and JD(U) leader HD Kumaraswamy, Times of India (TOI) reported.

But the leader from Karnataka and an ally of BJP told reporters later that he was misquoted. He added that the semiconductor industry has “strategic” importance for the country.

Last Tuesday, Kumaraswamy assumed the charge of Union Steel and Heavy Industries minister.

TOI reported that the minister on Friday, at a live address to party workers, asked why India needed investments from the US company Micron Technology, which is currently setting up a $2.5-billion (approximately Rs 200 crore) unit in Gujarat. He added that the Centre is offering Rs 3.2 crore in subsidies for each job created as a result.

He calculates that if the new manufacturing unit is going to generate 5,000 jobs, that will account for $2 billion in subsidies, which is around 70 per cent of the company’s total investment.

He told party workers that he had asked officials whether it was justifiable to allocate such a large amount for the project. He reminded that there are small scale industries in Peenya, an industrial estate in Bengaluru. He wondered, “How many lakh jobs have they created? What benefits have we provided to them?” TOI quoted the minister.

However, according to the Moneycontrol report, the minister made clarifications later on the day, moving away from his initial stand, saying that setting up a semiconductor manufacturing sector in India is required. He later said in a post that semiconductor manufacturing was a basic requirement for electronics and automobile manufacturing.

“I greatly appreciate the semiconductor-related initiatives taken by the Office of the Prime Minister [Narendra Modi] and will work towards fulfilling them through my ministry,” he wrote.

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TAGS:BJPCentreHD KumaraswamyJD(U)
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