Financial Daily from THE HINDU group of publications
Wednesday, Sep 10, 2003
Financial Daily from THE HINDU group of publications Wednesday, Sep 10, 2003 |
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Industry & Economy
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Readymade Garments Karnataka Govt may shift site for apparel park Abhrajit Gangopadhyay
Bangalore , Sept. 9 THE proposed apparel park venture, slated to come up near Doddaballapur in Karnataka, has received a jolt with the Karnataka Industrial Area Development Board (KIADB) proposing an alternative site at Jigani industrial area for the park, Government sources said. A viability study of the new location is currently under way and a final selection is likely to happen by this month-end, sources added. This new development has further delayed the much-stretched process of setting up an apparel park in the State. It may be recalled that despite inviting bids for joint venture partners in November last year and receiving "very encouraging" responses from several foreign as well as domestic players, the Karnataka Government is yet to choose a venture partner for the proposed project. "Several firms based in UK and Singapore have submitted their proposals through their India representative... the foreign interest is very positive," sources added. Recently, the Government had increased the proposed project cost of the apparel park to Rs 32 crore from Rs 20 crore. The hike in project cost was "due to increasing opportunities in apparel outsourcing," sources said. The project is likely to be implemented on a build-own-operate basis. The new venture partner is expected to build and maintain the infrastructure of the park and will be responsible for the operations of the park. The project is likely to be implemented by a Special Purpose Vehicle (SPV), in which the private partner is likely to pick up equity stake, Government officials said. However, the details of the proposed SPV, how much stake the partner is likely to pick up, are being finalised. The Central Government is likely to contribute Rs 17 crore towards the project, while the rest is likely to be shared by the State Government and the venture partner. The Central contribution will be Rs 10 crore towards infrastructure, Rs 5 crore to set up an effluent treatment plant while the remaining Rs 2 crore will be towards training. The State Government will chip in with Rs 10 crore and has already started to acquire land for the project, which is estimated to be span across 180 acre. Karnataka Industrial Area Development Board, which is acquiring land on government's behalf has already been paid Rs 2 crore for the acquisitions till-date. The recent thrust towards the Doddaballapur apparel park has put a stop to the proposed development of a similar project at Bellary. According to the Government officials, the second park will be taken up only when Doddaballapur becomes operational. The Bellary project is planned at Rs 11 crore.
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