The Hindu Business Line : Volkswagen

Pune March 10 Not only the Maharashtra Government but corporate Pune's First Family - the Bajajs - too played a role in the German auto major Volkswagen AG's decision to locate its car plant at Chakan, in Pune's backyard.

If the State Government made an exception and offered them land at a price (Rs 325 per sq m.) substantially lower than their normal asking rate (the Government had priced its land in the Phase 3 of its industrial development project at Chakan at Rs 700 per sq m.), the Bajajs in a fine example of good neighbourliness agreed to the Government redrawing the boundaries of the land originally allotted to it to accommodate the German auto maker.

Consequently, the land for Bajaj Auto's project which was originally a horizontal plot of land ended up being reshaped as a vertical one and the land thus released on its length-ward side got tagged on to a vacant parcel of land lying adjacent and offered to Volkswagen. While agreeing to accommodate the foreign auto giant's need for a larger plot (the largest in the area), the Bajaj Auto group did however lay down one condition - they should continue to share a fence with them. The reconfiguration does allow that.

Volkswagen got the land at Rs 325 per sq m. which works out to Rs 14.30 lakh per acre. The going rate for private land is reported to be in the region of Rs 40 lakh per acre, according to one industrial house that has recently acquired six acres of land in the area.

But the land cost is not a major issue in such big ticket deals, says Mr Rajiv Jalota, Chief Executive Officer of the Maharashtra Industrial Development Corporation.

More Stories on : Cars | New Projects | Real Estate & Construction | Maharashtra | Bajaj Auto Ltd

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