More flexibility needed in Oxygen Policy: COSIA
    Date :03-Jun-2021

COSIA_1  H x W:
 CA Julfesh Shah, Chairman of COSIA, Vidarbha giving
representation to Ashok Dharmadhikari, JDI, Nagpur.
Business Bureau :
To fulfill the oxygen requirement in view of the pandemic and counter shortage of oxygen in the third wave that is being predicted by experts, Maharashtra Government has come out with the Oxygen Policy which got notified on May 21, 2021. Presently there is a imbalance in the oxygen manufacturing plants in various parts of Maharashtra as well as there is a shortage of medical oxygen during the peak time. The scheme offers 150 per cent of incentives of the total project cost as well as capital subsidy to the Liquid Manufacturing Oxygen (LMO) plants above 25 MT/day capacity. Chairman of COSIA CA Julfesh Shah said that COSIA team has analysed the policy and discussed with the prospective unit owners.
After going into detail and minute analysis of the policy, it was found that some improvements and amendments were needed to make the policy more attractive and fulfill the targets set by the Government of Maharashtra. A memorandum of suggestions in this regard with due justifications was submitted to Joint Director of Industries, Nagpur Ashok Dharmadhikari by COSIA, Vidarbha led by Chairman CA Julfesh Shah. The suggestions highlighted various issues. Shah said, the proposed smaller units upto 25 MT /day capacity will not be able to claim the full quantum of the yearly eligible claim as the number of years are restricted to 7 only for MSME units and incentives offered are 150 per cent of eligible FCI in Vidarbha. Also interest subvention @ 5 per cent is restricted to twice the amount of electricity bills paid in a year.
Hence it will be extremely difficult to avail the full incentive claims with yearly cap. So to overcome this practical difficulty the number of years can be increased to atleast 10 years or more than that which will make it more lucrative for the MSME units. Another issue is that the units which propose to go in for oxygen cylinders manufacturing only are not offered capital subsidy. As oxygen cylinders are equally important for the storage of oxygen,it is no doubt an integral part of the LMO units and such units need to be given a booster by way of SCI as offered to LMO units as capex for such units is quite high, he explained. The policy guidelines doesn’t specifically mention anything about pure oxygen re-filling units. In remote areas, there are very few takers for LMOs plant as capital investment is quite higher. So in such places small entrepreneurs prefer to come with re-filling plant which requires less investment. G O Bharti, Joint Director of Industries, Amravati, Pranav Ambaselkar and Sharad Agrawal of COSIA were present.