Global Investors Meet Karnataka -ONE STATE MANY OPPORTUNITIES

Global investors’ meet in 2014

2013-09-06T10:14:00.001-07:00

The State government will organise the third global investors meet in 2014 and it is also proposed to formulate a new textile policy with attractive incentives to textile industries to ensure that the sector is globally competitive.

Addressing members of the two Houses of the Karnataka legislature at a joint sitting here on Monday, Governor H.R. Bhardwaj said the infrastructure policy of 2007 would be reviewed and the PPP mode of implementation encouraged to create an investor-friendly environment in the State. “It will be the priority of this government to make all-round efforts to strengthen and rejuvenate the single window clearance mechanism”.

He said at one time in the past, Karnataka was a favoured destination for investors and this pride of place has suffered a setback due to political instability and corruption scams apart from the global recession. “My government is competent to face these challenges and a healthy environment for industrial growth shall be created with a view to increasing employment. Essential infrastructure such as land, power, water and other facilities shall be provided in right earnest and special attention shall be given to protect the interests of farmers while acquiring land for industrial purpose”.

With reference to the education sector, the Governor said: “No government school will be closed based on flimsy reasons and the State will also move towards an eight-year elementary education cycle in keeping with the provisions of the RTE Act. Focus will be on enhancing the quality of teaching to make learning more activity based , child-centred and child-friendly.

In the field of higher education, a determined bid will be made to fill up all vacancies and it will be the priority of the government to improve the employability and skill development in order to ensure suitable job opportunities for all”.

Mr. Bhardwaj said the entire set up of horticulture marketing will be revamped to make it more responsive to the needs of the farmers. “Although farmers use just 15 per cent of the land for horticultural crops, yet we generate 40 per cent of the agricultural income from horticultural produce alone. To promote exports and value addition, high-tech horticultural clusters will be set up”.

In the housing sector, he said, efforts would be made to make the State free of huts and a Centralised Data Centre would be set up to monitor the achievement of targets across the multiple implementing agencies involved in providing housing.

Focus will also be on the development of Bangalore with a proper coordination among the various civic agencies.

Mr. Bhardwaj said the government would formulate necessary regulations within three months for the constitution of a separate development board as envisaged under Article 371(J) to provide a special status to the six districts in the Hyderabad Karnataka region.

‘No government school will be closed based on flimsy reasons’

Horticultural marketing to be made more responsive to farmers’ needs

Zuari shelves Rs 5,000-cr urea project in Karnataka

2013-07-25T16:42:00.000-07:00

Zuari Industries, which is in talks with UB Group Chairman Vijay Mallya to buy Mangalore Chemicals and Fertilisers, has shelved its Rs 5,000-crore urea manufacturing project in Karnataka.

An official with the Karnataka Government as also one in the company confirmed the development, stating that the project was put on the backburner because of land acquisition issues.

In 2010, Zuari and the Karnataka Government had signed an MoU (memorandum of understanding) to explore the possibility of setting up the project near Belgaum in north Karnataka. The MoU was signed during the Global Investors’ Meet organised by the Karnataka Government when B. S. Yeddyurappa was the chief minister. Zuari Industries was planning to set up a 1.3 million tonne per annum (mtpa) gas-based urea project, which was expected to go on stream in 2015-16.

Last week, South Korean steel giant Posco pulled out of its proposed Rs 36,000-crore, 6 mtpa project in Karnataka.

The only big steel project which is expected to see the light of day in Karnataka now is ArcelorMittal’s Rs 30,000-crore, 6 mtpa plant. The Karnataka Government is learnt to have already handed over 1,800 acres to the L. N. Mittal-owned company last year.

It is learnt that following the MoU, Zuari had started talks with the State Government to identify land for the project and for supply of natural gas from the Dabhol-Bangalore gas pipeline. But the project, which required about 400 acres, ran into trouble after local leaders started questioning the merit of allotting land for the project.

This is not the first time they have opposed the land acquisition for such projects.

The ArcelorMittal project too got slightly delayed because of this issue, but was resolved later.

Posco and Zuari Industries, however, could not swing the deal their way.

Another Zuari project, a one million tonne fertiliser plant at Karwar in west Karnataka with a capex of Rs 750 crore has also not been pursued so far, the Karnataka Government official said. The promoters are yet to hold talks with the Government for land acquisition, he added.

Zuari Industries is part of the $3-billion Adventz Group which sells products under the brand name, ‘Jai Kissan’.

INTEGRATED TOWNSHIP

Meanwhile, the Adventz Group is setting up a Rs 500- crore integrated township in Mysore in south Karnataka. The township, Zuari Garden City, is being build by its infrastructure company, Zuari Infraworld Ltd and is spread across 76 acres.

Of the Rs 500 crore, the group has infused Rs 200 crore, while the rest will come from customers.

Posco scraps $5.3b steel plant in Karnataka

2013-07-18T00:33:00.002-07:00

In a major setback to the state government Posco – a subsidiary of South Korean steel giant, the Pohang Steel Company Limited – on Tuesday decided to scrap its proposed 6 MTPA (million tonne per annum) steel plant project in Karnataka.

The company’s decision to pull out of a $5.3 billion steel mill in the state follows delays in land acquisition and adverse market conditions, including the ban on iron ore mining.

Posco had signed an MoU with the Karnataka government at the Global Investors’ Meet in Bengaluru in 2010 to set up the plant. In January 2011 they zeroed in on a 3,000-acre land in Gadag and notified the Karnataka Industrial Area Development Board accordingly and paid an initial deposit of Rs 60 crore to the Board.

According to an official statement the hearing for land acquisition was held with the land owners in June 2011 but due to agitations by some “farmers and religious leaders it was held back and finally, halted in July 2011. In addition, the mining scam in the State made the project progress even stagnant,” the company statement added.

GIM 2012 Progress Report

2012-12-02T17:20:00.001-08:00

Word Recognition For Karnataka Industrial Development

2012-07-21T21:37:00.001-07:00

State working on easier clearance system for investors

2012-07-13T02:02:00.002-07:00

Suhas Gopinath is designing the online portal which would save investors the hassle of visiting multiple departments

Stung by fierce criticism of the single window system at the Global Investors Meet 2012,the states flagship event,the government has moved with alacrity to close off loopholes.

Suhas Gopinath,once the worlds youngest CEO,is designing the states first online single window clearance portal for entrepreneurs who participated in GIM 2012.The portal,designed by Globals ITeS Private Limited,Gopinaths company,will be launched soon by chief minister Jagadish Shettar.

The existing single window clearance mechanism attached to Karnataka Udyog Mitra was criticised by investors as a system with multiple ventilators.They said they had to trek to departmental offices even after applying through the system.

The new online single window system will ensure that investors secure all clearances,right from land to utility,through the portal without having to go through the hassle of visiting multiple departmental offices.
The government had inked 249 MoUs with companies that had evinced interest in investing in various sectors,following which 490 expressions of interest have been entered into.The proposals promise an investment of Rs 7.69 lakh crores.

M N Vidyashankar,principal secretary,industries and commerce department,told There were a number of complaints from investors about the existing single window clearance system as they still had to run around for various departmental approvals.So we decided to open an online system where investors neednt have to visit government offices.They can apply online and even pay fees.

If investments are less than Rs 50 crore,it will be cleared by the Udyog Mitra.Investments above Rs 50 crore will come to under the governments purview.

Info of 868 MOU's signed GIM 2012

2012-07-07T00:23:00.001-07:00

Housing,Education and Healthcare MOU's

2012-07-02T00:48:00.001-07:00

Textile MOU's

2012-07-02T00:44:00.003-07:00

Petrochemicals MOU's

2012-07-02T00:43:00.000-07:00

Pharmaceutical MOU's

2012-07-02T00:41:00.001-07:00

IRON & STEEL MOU's

2012-07-02T00:39:00.002-07:00

Infrastructure MOU's

2012-07-02T00:38:00.000-07:00

Hospitality MOU's

2012-07-02T00:34:00.000-07:00

Food Processing MOU's

2012-07-02T00:31:00.000-07:00

Engineering MOU's

2012-07-02T00:27:00.001-07:00

Cement MOU's

2012-07-02T00:24:00.000-07:00

Automibile MOU's

2012-07-02T00:21:00.004-07:00

Aerospace Mou's

2012-07-02T00:08:00.000-07:00

IT/ITES MOU's Signed

2012-07-02T00:01:00.003-07:00

KIADB plans to develop new industrial townships on 17,000 acre

2012-06-19T20:48:00.002-07:00

Karnataka Industrial Areas Development Board (KIADB), a wholly owned infrastructure agency of Karnataka government has envisaged development of new industrial townships at several districts in the state to facilitate industrial development. The Board is presently in the process of acquiring close to 17,000 acre to develop new industrial areas, a top KIADB official said.

“KIADB acquires land for two purposes. We acquire land for large industrial projects as single unit complex (SUC) and also develop industrial estates wherein we allot land to small and medium enterprises. In the last two years since global investors meet in 2010, we have acquired 2,000 acre in Vasantha Narasapur in Tumkur district and 1,000 acre at Narasapur in Kolar district, 660 acre in the first phase at Vemagal in Kolar district,” MB Dyaberi, Chief Executive Officer, KIADB said.

KIADB has also acquired more than 1,000 acre in Hubli-Dharwad, 600 acre at Kittur in Belgaum district, 5,000 acre in Yadgir district and 500 acre in Bidar district for the development of new industrial townships. “In Yadgir we are developing an exclusive industrial estate for pharmaceutical companies,” Dyaberi told Business Standard on the sidelines of a seminar at Global Investors’ Meet 2012, held recently.
He said the Board is ready to allot land to industries in all these townships. In Vemagal, which falls between Bangalore and Chennai region, the KIADB is developing new industrial area in two phases. While it has acquired 660 acre so far in the first phase, another 1,250 acre have been identified for the second phase.

In Narasapura Industrial Area in Kolar district, which is located 53 km near Bangalore, the KIADB has proposed to develop the township in three phases. For the first phase, it has acquired 685 acre and notified 1,480 acre under Section 28(1) of KIADB Act for the second phase. For the third phase, it has identified 2,000 acre.

Similar, KIADB has also proposed to develop a new industrial area at Vasantha Narasapura in Tumkur district in three phases. For the first phase, it has acquired 782.22 acre, 1,242.19 acre for second phase and 1,492.16 acre for the third phase.

Dyaberi said in addition to all these, the KIADB has acquired about 6,000 acre for SUC projects that include Arcelor Mittal, BMM Ispat and NTPC among others. It has so far provided land to about 400 standalone (SUC) major industries in the state.

Till date, KIADB has formed 141 industrial areas spread all over the state covering 40,000 acres. This apart, KIADB has envisaged innovative projects like Agro-tech parks, apparel parks, food parks, hardware park, bio-tech park, EPIPs, sector specific SEZs, growth centers across the state. It provides basic infrastructure in the industrial areas.

The KIADB, henceforth facilitate the industries to secure environment, pollution and water clearances under one roof along with allotting land, Dyaberi added.

Karnataka requires 60,000 acre land for all projects approved during the global investors’ meet in 2010 and 2012. The government has issued preliminary notification for 86,000 acre, while final notification has been issued for 46,000 acres. The government would spend about Rs 2,000 crore in the next five years to provide infrastructure facilities to new industrial estates like water, lighting, roads and sewage among others, Murugesh R Nirani, minister for large and medium industries said.

When land banks come in handy

2012-06-15T09:03:00.000-07:00

The Global Investors Meet 2012 shows that land availability has to be kept in mind while framing policies and signing MoUs for the industrial development of Karnataka.

A critical analysis of the gains from the just concluded Karnataka Global Investors Meet 2012 reveals that the role of land in industrial development in the State is pitted high. The estimated land-needs for the various projects for which MoUs have been signed is stated to be of the order of 1,20,000 acres. It has also been reported that the State Government has already a land bank of 46,000 acres and preliminary notification has been issued for another 40,000 acres. What is the feasibility of providing the required land in the backdrop of land acquisition controversies and the impending Central legislation? Will it be feasible to industrialise without jeopardising the agricultural sector and the ecological balance?

Land, labour and capital are the fundamental requirements of industrialisation. There have been conflicts for various reasons and in particular, over the human attraction of securing rights over land which can be used for diverse purposes. Many promoters these days seek overestimated extent of land, that too in continuous stretches. This brings to the fore conflicts with the farming community whose fundamental avocation is tilling the land and when they lose the land there will be agitations against land acquisitions.

The Nandikur episode and the shifting of Tata's ‘Nano' car project from West Bengal to Gujarat are still fresh in our memory. The farmers' demonstrations against the GIM in Bangalore need to be recognised as an issue to be taken care of.

Direct impact

Most of the investment proposals have come from power generation companies such as GVK Energy Ltd., Surana Power Ltd., Mytra Energy (India) Ltd., Flamingo Power Pvt. Ltd., Suzlon, Udupi Power Corporation and similar entities, which requires more land, possibly away from the areas of human habitation.

Steel companies including Tata Steel and Kalyani Steel are into taking vast areas of land.

Proposals pertaining to construction by Ramky Group, Embassy Group and other infrastructure development companies too will need vast stretches of land. IT and electronics comes to as low as six per cent of sector-wise investments proposed, which occupy less land. It could be argued that the energy, steel and other industries will be located in various parts of the State and the pressure on land needs will be distributed).

Indirect impact

Tourism occupies a fair amount of investment plans, which will have indirect impact on land, by way of up-gradation of roads, tourist accommodation etc.

Residential accommodation for the employees who will require to work in the large and medium industries need to be built, and this too will require some land which will have to be earmarked.

Considering the fact that land availability is not unlimited, industrial development plans may have to be based on limitations on land and maximum returns, both in turnover and job generation. Further, in order to avoid sectoral imbalances, land use policy needs to be laid down before embarking on massive commitment of land for investing in industries.

Balancing act

The KUM (Karnataka Udyog Mitra) may have to establish close liaison with other departments dealing with land acquisition. A separate coordinating body under the Planning Department may be a feasible thought.

i360 Bangalore

2012-06-15T01:35:00.002-07:00

PE-backed Welspun buoyant on renewable energy

2012-06-15T01:31:00.000-07:00

Welspun Corp’s energy unit signs MoU to invest $1bn in Karnataka in the renewable space.

Welspun Energy, an associate company of Apollo Global Management -backed Welspun Corp, is looking to invest as much as Rs 5,675 crore (just over $1 billion) over the next five years in Karnataka to set up wind power projects.

The company has signed an MoU with the Karnataka government for setting up two separate wind power projects with 750 MW and 100 MW capacity, expected to be commissioned in the next five years. Further, the company is aiming to develop renewable energy projects that will have an installed capacity of 1.7 GW in total.

The investment requirement for this capacity has been estimated at Rs 5,675 crore, to be financed in the 3:1 debt-equity ratio. This would mean an equity component of around Rs 1,420 crore ($253 million).

Vineet Mittal, co-founder and managing director of Welspun Energy said, “With India being the fifth largest installed wind power capacity in the world, there is immense scope for growth.”

The MoU was signed in a regular state level global investors meet, which saw commitments to the tune of Rs 1.6 lakh crore, almost half of which involved the energy sector, led by wind and solar power projects. Besides, Welspun, others who flaunted huge investment numbers include Suzlon and Mytrah Energy.

Karanataka holds high potential for the development of wind power projects.

Globally, India is the fourth largest consumer of renewable energy, accounting for five per cent of global consumption compared to China's more than 21 per cent. China is the world's largest renewable energy consumer.

However, in terms of composition of primary energy consumption basket, the share of renewable in India is a mere 1.6 per cent, while the rest is accounted for by coal, natural gas, hydro and nuclear energy.

Rising cost of coal, which raises the cost of thermal power projects, has got a string of power generators to look at renewable space as the next big thing. Backed by subsidies and other incentives provided to develop clean form of energy, companies have been quick to implement solar and wind power projects in the country.

Welspun Energy is an associate firm of group flagship Welspun Corp, a listed company. Last year, private equity giant Apollo Global struck a deal to invest up to $494 million in three companies of BK Goenka-promoted Welspun Group including Welspun Corp. Welspun Corp owns 26 per cent of Welspun Energy. Welspun Energy is setting up power projects in wind, thermal and solar fields. It has over 270 MW of solar projects on the ground and a pipeline of 1.7 GW of renewable power projects.

Split up of Embassy Group's 15000 Cr MOU with GOK

2012-06-15T01:28:00.003-07:00

Property developer Embassy Group has signed an MoU and shared EoI (Expression of Interest) documents with the Government of Karnataka at the Global Investors Meet 2012, for the development of four mega projects in the state with a projected total investment of Rs15,000 crore. The projects will span the development of integrated IT parks for IT/ITES with commercial, residential and support facilities and a logistics park, which will mark Embassy Group’s strategic foray into the logistics and warehousing business.

Jitendra Virwani, chairman and managing director, Embassy Property Developments, said, “Having developed four business parks in Bangalore in the past decade offering workspace for over 2 lakh people, we are committed to the development of Karnataka and happy to make this announcement at GIM 2012. These projects envision the creation of workspace and infrastructure for close to 1 million people and can have a catalytic effect of creating another one million indirect jobs.

The integrated parks will host infrastructure that can significantly help decongest the city as well as improve Karnataka’s contribution to the country’s export potential and international trade.”

While the integrated IT parks will come up in North Bangalore, the logistics park will be developed at Narsapur/Vembgal in the north eastern part of the city. Embassy has partnered with the Maini Group to form a joint venture, christened Embassy-Maini Logistics Bangalore Pvt. Ltd, for the development of this logistics park. This joint venture marks Embassy Group’s first ever foray into the business of logistics warehousing. Embassy and Maini have come together to develop and offer large format fully-fitted warehouses in major cities across India.

Delving further on his company’s maiden logistics project, Virwani said, “This is a strategic diversification initiative for us. And we are extremely happy to be partnering with the Maini Group. We believe there are valuable synergies in this partnership – while Embassy brings deep experience in developing land, design and construction, the Maini team brings in their rich expertise in design and manufacture of fit-outs and infrastructure for warehouses.”

Highlights of some of the key projects are:

Project: IT/ITES, BPO, Residential & other facilities
Location: ITIR - Doddaballapur SH 207
Area: 500 acres

Project: IT/ITES, BPO, Residential & other facilities
Location: Tarahunise
Area: 216.04 acres

Project: Warehouse (Logistics)
Location: Narasapura IInd Phase or Vembgal
Area: 200 acres

Project: Warehouse (Logistics)
Location: Doddaballapur
Area: 200 acres