Question -
Answer -
The following incentives are offered by the Government in backward and hilly areas:
1. Land: The government has offered lands at reduced rates in order to encourage setting up of small industries.
2. Banking and Finance: The government is offering subsidies in loan amount up to 10-15% for establishing business in backward areas. This is done to encourage business, and capital is very much essential to start business.
3. Raw Materials: Availability of raw materials for setting up industries in hilly or backward areas is very scarce, so the government has made sure to provide the raw materials such as cement, steel and iron to expedite industry set up.
4. Tax exemption: Government has encouraged new business by promising tax exemption for industries in backward areas.
5. Power: Electricity is essential for a business and machinery, so to help more business to start government is providing electricity at 50% discounted rate.