The delay in clearing, which is now expected only after the formation of a new government, these policies will have a bearing on investments in the auto and other related sector in the state.

In these circumstances, it may be noted that the French trye giant Michelin has not yet decided on their manufacturing location although the Karnataka industries and commerce department dangled carrots to attract the company into its fold with extra incentives.

It is learnt that the French firm had expressed dissatisfaction over the site in Whitefield shown by the department. Since the state is facing yet another election shortly, any further decision on this will breach the poll code and could attractaction from the election commission.

According to highly-placed officials in the state industries and commerce department, the Karnataka government had already decided against clearing the much-hyped auto policy. The policy was envisaged to provide an impetus to Karnataka's automobile industry.

Formulated by the Confederation of Indian Industry (CII) and the state government in consultation with KPMG, the draft suggested setting up of an autopark in Karnataka to provide a single umbrella facility for the auto sector.

At an expected investment of Rs 250 crore, the park was expected to have come up on an area of 1,000 acres of land either in Bidadi or Malur (near Kolar). The draft also proposed for the formation of an auto council, a self-sustained body that would take necessary decisions and provide approvals.

The officials said the state's textile policy - promised by the small and medium scale industries minister BL Shankar on March 2, 1999 - is unlikely to see the light of day during the currentfiscal. In fact, the entire textile industry in Karnataka is facing a grim future.

Promising to resolve the crisis in the textile industry, Shankar had said the state textile policy would analyse reasons for the poor performance of the mills in Karnataka over the last few years.

``Currently around 30 per cent of the installed capacity is idle. Many mills had curtailed their production and most of the mills are incurring heavy losses,'' a source in Karnataka Textile Mills Association (KTMA) told The Financial Express. According to the source, the number of mills closed in Karnataka is likely to in the region of 10-15 and as many as four mills are not working presently due to adverse economic conditions. KTMA represents around 59 mills in the state. Dwindling cotton prices, taxation policies of the state government, power tariff, interest cost and wage cost per kg of yarn being higher in Karnataka contributed to the present critical scenario.

The proposed drug policy of the state is also hanging fire.Earlier, health minister HC Mahadevappa had announced that the state would come up with a drug policy to clear anomalies in sourcing materials to state departments and to attract investments in the sector.