NEW DELHI: The government has approved a scheme for strengthening the capital goods sector and sanctioned Rs 4,754 crore for strengthening power transmission systems in Arunchal Pradesh and Sikkim.The Rs 930 crore scheme “Scheme for Enhancement of Competitiveness of the Capital Goods Sector” will be implemented in the 12th Plan period and spill over to the 13th Plan period. It envisages setting up of technology acquisition fund, tool parks, R&D and common engineering centers. Key technological areas that the government wants to upgrade are machine tools, textile, construction, mining and process plant machinery.“This scheme, on its implementation, would attempt to make the Indian capital goods sector globally competitive,” the government said in a statement after a meeting of the Cabinet Committee on Economic Affairs (CCEA). Gross Budgetary Support (GBS) from the government for the scheme would be Rs 581.22 crore and the balance Rs 349.74 crore would be contributed by the stakeholder industries.India’s capital goods imports have risen sharply in recent years. A more competitive industry will revive local manufacturing and also reduce imports. The power schemes for Arunachal and Sikkim with connect the two states to the national grid. “Intra-state transmission and distribution systems in the North-East states are very weak. Presently, 5 out of 20 districts in Arunachal Pradesh are connected to the transmission network,” the government said in a statement.The project would be implemented by Power Grid Corporation at a consultancy fee of 12% of the execution cost. After commissioning, the projects would be owned and maintained by state governments. The DONER ( Ministry of Development of Northeastern Region ) was unable to finance the scheme, prompting the power ministry to step in.The project is to be implemented within 48 months from the first fund release to Power Grid Corporation.