The Hindu Business Line : SIMA looking at AP to locate `spinning park'

Southern India Mills Association (SIMA) is exploring the scope of putting up a textile `spinning' park in Andhra Pradesh's Nellore district, to take advantage of lower power tariff and slew of investment incentives being offered for the textile enterprises by the Andhra Government.

It is likely that at least 10 or 15 SIMA-member textile units already having textile operations either in Tamil Nadu or Andhra Pradesh will be the prospective investors. The park is being planned on an 400-acre site at Naidupet, some 100-km from Chennai. The proposed park, if implemented , may trigger a total investment of about Rs 1,500 crore or so. Officials of the Andhra Pradesh Department of Handlooms and Textiles who were here today in connection with an investment roadshow `Destination Andhra' said the State Textiles Department would be in a position to extend the land sought by SIMA.

Stating that the proposal was still at a preliminary stage, officials said the Andhra Pradesh Government's 2005-10 textile policy has offered several concessions to new textile investors including concessional power tariff, which will be cheaper by one rupee per unit over the existing tariff for garmenting units and lower by 75 paise per unit for textile enterprises other than garmenting.

Besides making available the trained manpower needed by the textile industry, the State Government will also extend a training grant of Rs 5,000 per worker trained and employed by the new textile unit in garmenting, processing and weaving and in the case of spinning, the grant will be Rs 1,000 per worker trained and employed.

The Government will also extend the 100 per cent reimbursement of stamp duty paid by investors for the land for putting up the industry.

Talking to presspersons , the Commissioner of Andhra Pradesh State Handloom and Textiles Department, Mr T. Sathyanarayana, said adequate skilled labour availability which is also about 30 per cent cheaper compared to Tamil Nadu and lower power tariff are among the favourable factors for SIMA member-mills turning to Andhra Pradesh.

However, SIMA appears keen on obtaining a long-term concessional power tariff pact with the Andhra Pradesh Government before venturing into the new project.

"We are asking for a staple power tariff for a ten-year period at a frozen rate from the date of commencement of commercial operation," said Mr S.V. Arumugam, Chairman of the SIMA, while confirming his member-units keenness on investing in Andhra Pradesh.

If this concession was extended, SIMA would take it to its member-mills spread across the four southern States evincing interests in the new investment, he added.

Since the 10-year power tariff guarantee demanded by SIMA is involved the policy decision, the Andhra Pradesh Textiles Department would have to secure the concurrence from the State Government.

"SIMA is expected to make known its position on this officially and the current exercise is still in early stage," said Mr Sathyanarayana.

The Andhra Pradesh Textiles Department is to hold its roadshow for textile sector investment in Bangalore sometime during first week of November.

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