[Jai]

City will breathe easy once SEZ comes up

15 May 07
DNA Epaper

Plans for Reliance's Navi Mumbai Special Economic Zone (SEZ) have hit a road block as a railway line passes through proposed corridor that lies between Pen and Uran in Raigad district. So, everyone is now waiting for May 31, when the Centre's inter-ministerial Board of Approvals (BoA) meeting is slated to be held.

Though the BoA has given its approval for the 2,150 hectare SEZ in principle, formal approval was withheld during the last meeting.

The reason the board gave was that a railway line passed through the zone, which might result in revenue loss to the finance ministry. The SEZ will be a deemed foreign territory with duty-free import and export facility.

Being planned on 2,150 hectare of the coastal belt, the Navi Mumbai Special Economic Zone (NMSEZ) and the futuristic Mumbai Special Economic Zone (MSEZ) — which would come up on 5,000 hectare adjacent to it — are emerging as an attempt to decongest an overcrowded Mumbai.

In a recent interview to a private television channel, Anand Jain, chairman of the Reliance-led project revealed that SEZ townships, deemed to be foreign territories, would be world-class cities that will offer economic, trade, civic, recreational, and entertainment facilities to over one million residents and two million people who will work there.

According to Jain, the proposed trans-harbour-link between Nhava and Sewree will reduce the distance between mainland Mumbai and the SEZ by 20 minutes and will strengthen the Pune-Mumbai industrial corridor.

“Surely, it will be a new urban and industrial platform... The new towns will offer the best of hospitality, health and educational facilities," said a highly placed official at NMSEZ, according to whom, the BoA's approval of the NMSEZ was to be a mere formality.

Even as the Maharashtra government expects an investment of over Rs2,00,000 crore from Indian majors and multinationals at this economic and trade zone, Reliance has revised its SEZ projections, and is now expecting investments of over Rs3,00,000crore.

“The revision of the target has come following the hike in its project cost from Rs25,000 crore to Rs30,000 crore," NMSEZ sources reveal.

Till date, the total domestic commitment from the Indian majors is more than Rs5,000 crore.

Even the target of power generation for SEZ has gone up from 1,600MW to 2,080MW. Top IT establishments, health care groups, automobile giants, and reputed names in hospitality business have already registered their interest in the new SEZ. So far, 700 foreign multinationals and over 300 domestic companies have put up a proposal to set up their industrial and trading establishments in the upcoming SEZs.

An official with City and Industrial Development Corporation (CIDCO), the state's nodal agency for SEZ project, said the RIL-led NMSEZ will offer six basic facilities — roads, water supply, rain-water disposal system, an underground sewage network, power supply, and telephone lines. The steamline and gas connections are under consideration and will be extended depending upon the requirement of industries, revealed the official.

Business houses in this zone will be offered special tax rebate, as the idea is to attract more and more private firms and multinationals to the area. The zone will offer special relief on export and import duties to industrial set-ups.

The proximity of Dronagiri in Uran to the Mumbai-Pune Express Highway, the Jawaharlal Nehru Port Trust, the proposed SewriUran sea link and the Navi Mumbai airport, has enabled the state in developing it as an SEZ. The area is already in demand from many business groups in and outside the country. “We are still planning the design details and broad zoning for our 900 clients, who have shown interest in setting up their business installations here. The response to the SEZ is just mind-boggling. It will take two years to put in place the best infrastructure,” said a NMSEZ official who is involved in the planning process.

The government expects massive investments from pharmaceutical, bio-technology, cloth, and petrochemical industries in these SEZs.

NMSEZ waits for official go-ahead Over 400 cream recruits at the newly set up office of the Navi Mumbai SEZ Development Corporation Ltd (NMSC) in CBD Belapur await the formal enactment and notification. “We are still at the planning stage since it is going to be the most gigantic of the infrastructure projects ever in the country,” said a NMSEZ official.

And now that the NMSEZ has been taken over by the Reliance group, the project has picked up steam. Talking to DNA another NMSEZ official said unless the government issued a notification, they would not perform a bhoomi pujan and fix a deadline for the project.

However, the fencing of 450 hectare of land is underway.

The first phase worth Rs5,000crore will be completed in two years with the Reliance-led conglomerate gathering over Rs3,000 crore in equity and shares.

RIL has a 75 per cent stake in the Maha Mumbai SEZ and a 49 per cent in Navi Mumbai SEZ. The SKIL has a 25 per cent stake in the Mumbai SEZ.

NMSEZ officials, however, refused to divulge the names of companies which have shown an interest in setting up a business at the Reliance SEZ in Dronagiri. While actual Foreign Direct Investment (FDI) was yet to be calculated, sources, disclosed that over 200 multinationals had queued up to register at the SEZ. They are estimated to bring in over Rs8,000 crore.

It may be recalled that the central and state governments have already given consent to the SEZ Bill in 2005 and that Commerce and Industries Minister Kamal Nath had declared that the implementation on the bill had begun with effect from February 10, 2006.


Contours of the SEZ
¦ NMSEZ has already started fencing 450 hectare of land handed acquired last year. The state government recently sanctioned 400MLD of water from the Balganga River for the NMSEZ project. It will be a permanent source of water.

¦ The land being used for the SEZ includes parts of villages and talukas like Dronagiri, Ulve, Kalamboli, and Uran. The equity participation in the project by private companies is around 74 per cent while that of the CIDCO stands at 26 per cent.

¦ As per the agreement, the developer of SEZ, i.e. Reliance-led NMSEZ Ltd, will have to complete the infrastructure work within six years. The company will be responsible for the development of all basic infrastructural facilities. Fifteen per cent of the total SEZ land will be used for residential purposes.

¦ The equity partnership vehicle of RIL comprises Reliance Gas, Reliance Exclusion, Avinash Bhonsle, Nikhil Gandhi, the Hiranandanis, Pet Fibre, and Jay Corporation.

¦ The Union Commerce and Industries Ministry has given consent to the development of 117 SEZs in 15 different states and union territories, of which 51 SEZs have been technically given approval while 66 SEZs are officially under consideration.

¦ The Mukesh Ambani-led Reliance Industries Ltd (RIL) appears to have learnt a lesson from Nandigram. The industry major has begun acquiring land on its own by convincing farmers to sell, and has already purchased 1,200 acres of the total 25,000 acres needed for its Mumbai Special Economic Zone (MMSEZ) project.

¦ Following protest over the acquisitions, Reliance has announced attractive packages for farmers - Rs25 lakh compensation per hectare, 12.50 per cent developed land, and employment for one family member. The process of acquisition for MMSEZ is expected to be over by December 2007.