The Hindu Business Line : Gujarat making strides in infrastructure

Infrastructure plays a vital role in any economy. In particular, availability of better infrastructural facilities is, perhaps, the single most important factor in attracting investments for other sectors of the economy. While the Centre and many other states have realised this fact in recent past, Gujarat did so many years ago. If Gujarat has been amongst the most industrialised states of India, it is because of its ability to go ahead on the infrastructure front irrespec tive of political developments. For instance, all political parties in the State have whole-heartedly supported the Sardar Sarovar Project over the last five decades. Gujarat has come up on almost all parameters of infrastructural developments, be it the availability of power, water, communications, road or rail transport. If the industrial town of Jamnagar went through a water crisis, the State Government sent special trains carrying water wagons there in the last decade. If the 1990s saw at least four drought years, the current decade has seen better monsoons which has boosted agricultural production and solved the water crisis of the last decade to a large extent.

They call it the “Gujarati khamir”, the go-getting spirit. The State rose as one to meet the challenges posed by the 2001 earthquake, particularly in Kutch district, where investments to the tune of nearly Rs.15,000 crore have been made since. Kutch is now contributing a major share in production of salt and saw pipes and is preparing to emerge as Asia’s largest centre for wood-based industries. This largest and arid district of the country has no forests and has therefore not been declared or covered under the forest zone.

Following the declaration of Kutch as a “wood-free zone” recently, close to 200 plywood units and 500 saw mills are likely to be set up within a year. The post-quake tax holiday has completely transformed the economy of the district with 40,000 new job opportunities created during the last five years. If the rise of the Ambanis’ Reliance Group in the 1970s and 1980s was attributed to their capacity to scale up manufacturing and backward integration, the rise of the Adani Group in the 1990s and 2000s has been due to their forays in the infrastructure segments like ports, energy and power.

Water

The Narmada River, which has been dammed with the ambitious Sardar Sarovar hydroelectric power-cum-water supply project, has been described as the “lifeline of Gujarat.” Although its mighty canal network construction is still under construction, it is already supplying water to different parts of Saurashtra, North and Central Gujarat and Kutch, the perennially thirsty regions of the State, as also to parts of neighbouring Rajasthan. At its peak reservoir level of water at 123 metres during the monsoon season, as in July this year, the dam generated 1,200 mw of hydro power a day, thus contributing significantly to the power situation.

All six turbine generators of 200 MW each start working as soon as the water level reaches a minimum of 110.64 metres. Besides, the Canal head Power House (CHPH), with an installed capacity of 250 MW, also produced additional power. Till March this year, the SSP had generated a total of 5815 million units of hydro-electric power in 2006-07.With drought years being a thing of the past, around 50 reservoirs across Gujarat overflowed this monsoon season. This has significantly reduced dependency on ground water and fewer tubewells are now being sunk in many areas.

Urban Development

Gujarat’s progress has been synonymous with infrastructure, investments and inspiration.The Union Minister for Urban Development, Mr S. Jaipal Reddy, informed in Ahmedabad on September 17 that the Centre has sanctioned Rs. 3,990 crore for the development of urban infrastructure in Gujarat under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM). Of this, Rs.2,500 crore have been allocated for improving urban infrastructure and government, Rs.1,142 crore for basic services for urban poor, Rs.213 crore for infrastructure in small and medium towns and Rs.137 crore for integrated housing and slum improvement.

The Centre would also consider the metro rail project for Ahmedabad.Work on the Bus Rapid Transport System (BRTS) for Ahmedabad, included to be financed in the 11th Five Year Plan, is already in progress. The Centre has approved funds for a storm water drainage system(Rs.303 crore), railway over-bridges (Rs.97 crore), flyovers (Rs.70 crore), road projects (Rs.50 crore) and sewage projects (Rs. 224 crore), the Minister said.

Besides, altogether Rs. 274 crore has been sanctioned for water supply projects in 32 towns of Gujarat. For improving the lot of the urban poor, he said, Gujarat will get Rs.1,142 crore under the Basic Services to Urban Poor (BSUP).

Industrial corridor

One of the watershed developments to take place in Gujarat in the near future is the proposed Delhi-Mumbai Industrial Corridor (DMIC) of which this western coastal State would be a major beneficiary. For, Gujarat will have 38 per cent of the total length of 1,483 km of this corridor. Two investment regions and four industrial areas have been identified initially in Gujarat. These are the Ahmedabad-Dholera Investment Region and Vadodara-Ankleshwar Industrial Area, to be developed in Phase One.

The DMIC Influence Area in Gujarat comprises 62 per cent of the total area, covering eight districts out of 25, 74 per cent of population (3.70 crore people) and 29 of the 42 SEZs sanctioned till July 2007.Other key projects include Special Investment Region (SIR) at Dholera and Petroleum, Chemicals and Petrochemicals Investment Region (PCPIR) at Dahej.

Car-makers like Suzuki and others have evinced interest in Gujarat to explore possibility of shipping their wares for exports from the State’s ports, particularly in Kutch.

Communication

Gujarat has been far ahead of many other states in terms of communication. With the number of mobile phone users crossing the one crore mark recently — Hutch alone accounts for half of these—every fifthGujarat-based person now has a cell phone. Hutch is investing nearlyRs.1,000 crore in the State in the current financial year as part of its expansion plans. In December 2006, the company had signed a Memorandum of Understanding (MoU) with the State Government to incrementally invest Rs.2,500 crore until 2011. This was expected to generate 83,000 employment opportunities. The company, which investedRs.330 crore last year, is also increasing number of seats at its call centres up to 5,000, Mr Sunil Sood, Director (Operations), said here recently.

Besides, public sector BSNL, the third largest provider after Hutch and Idea, is also gearing up in a big way, particularly in the broadband space for IT.

Special Economic Zones

Gujarat, with 51 SEZs sanctioned so far, has now also emerged as the SEZ capital of the country, in terms of area of land encompassed. With approximately 16,500 hectares of the land earmarked for these SEZs, Gujarat tops the national chart of the Indian States. Maharashtra enjoys second position with around 11,500 hectares, followed by Andhra Pradesh with 11,000 hectares, Tamil Nadu with 5,000 hectares and Orissa with 2,500 hectares. While Maharashtra accounts for the maximum number of SEZs (75) followed by Andhra Pradesh (60) and Tamil Nadu having 60 SEZs, Gujarat with 51 SEZs accounts for an average of 323 hectares, the highest among the States. As a result, in SEZs also,Gujarat is expected to attract large quantum of industrial investment.

Gujarat has the distinction of locating most of its SEZs in arid or coastal areas with sparse population. Due to this, this State has not witnessed any protests over allocation of land for the SEZs. Industrial peace has also been a major reason for Gujarat becoming an investment destination.

State PSUs

After a successful turnaround exercise in recent years, the State Government-owned PSUs are now looking for expansion of their operations by way of putting in fresh investments, diversification in new products and services as also venturing into the territories outside Gujarat. These State ventures are expected to invest overRs.5,000 crore by 2010 in various projects. Gujarat State Fertilizer Company Ltd (GSFC) plans to invest Rs.500 crore for its third melamine plant, sulfuric acid plant, methanol and wind mill project, besides entering into a joint venture with TIFERT in Tunisia to ensure uninterrupted supply of phosphoric acid. Similarly, Gujarat Alkalies and Chemicals Ltd (GACL) is working on a Rs.500 crore expansion plan.

Gujarat Narmada Valley Fertilizer Company (GNFC) is planning a total investment of Rs.2,000 crore and has recently signed a memorandum with the US-based AluChem to set up a $400 million plant to produce alumina-based specialty products. Gujarat Industrial Power Ltd (GIPL) is commissioning two lignite-based power plants of 125 MW each at Surat.

IT Parks

One of the largest real estate players of the country, DLF Ltd, is looking for an investment of hundreds of crores in the next three years for development of IT Parks, hotels, malls and housing projects in Gujarat. The company is also exploring the possibilities of making investment in port and airport projects in the state. DLF plans to come up with three IT Parks in the state involving an investment of Rs. 3,000 crore, of which work has been commissioned for upcoming IT SEZ in Gandhinagar. The IT Park at Gandhinagar will have an investment of Rs. 850 crore and expected to generate employment for 2,000 persons. Besides, DLF is also considering setting up at least one airport in Gujarat with an investment of around Rs. 5,000 crore.

DLF, the Raheja Group, Ganesh Housing, Kalika Constructions, Adani Infotech are among those with the proposals to set up IT SEZs with an investment aggregating Rs. 3,500 crore. DLF has identified 25 acres of land in Gandhinagar, 30 acres in Ahmedabad and another 40 acres near Vadodara for its IT Parks. Similarly, K Raheja Corp is setting up an IT SEZ with an investment of Rs. 800 crore at Koba between Ahmedabad and Gandhinagar and for the purpose, received approval from the Government of India. Adani Infotech is planning for IT SEZ over an area of 50 acres with investment of Rs. 400 crore. While GaneshHousing is planning an IT SEZ in 120 acres involving an investment ofRs. 613 crore, Kalika Construction is setting up an IT SEZ near Gandhinagar with investments of Rs. 350 crore over an area of 60acres.On September 18, TCS also got clearance for its SEZ near Gandhinagar.

Education and Health

Appreciating the core strength of the state to provide job opportunities to the skilled manpower by the industrial sector, many institutions have shown interest to set up their base in Gujarat. Indian Institute of Technology (IIT), Mumbai, is considering to set up a satellite centre on the Ahmedabad-Gandhinagar Knowledge Corridor.The Institute will offer the same courses it offers in its Powai campus. In the same way, the Mukesh Ambani-led Reliance Industries is planning to set up a mega-university, which will produce nearly 10,000graduates every year. Further, a team from National Institute for Pharmaceutical Education Research (NIPER) has also visited the locations near Gandhinagar to identify the site for its new institute to offer post-graduate courses in pharmacy, in addition to research and clinical test facilities.

Nearly three years ago, the State Government had decided to hand over the management of important government hospitals to the private sector, including pharmaceutical companies. It is planning to privatize all 23district Civil Hospitals, in addition to six hospitals attached to medical colleges, as also the primary health centres in the state.

For the purpose, the State Government had invited proposals from private sectors to take over management of these hospitals which have accumulative strength of over 4,000 beds. Corporate giants engaged in pharmaceuticals and health care sectors such as Apollo Hospital,Wockhardt, Cadila and Torrent have already evinced interest in taking over some of these hospitals and are in the process of finalizing it.

At the same time, for the privatization of around 1,000 PHCs and 272 Community Health Centres, the State Government is planning to involve NGOs. In the recent past, Gujarat, and particularly Ahmedabad and Gandhinagar, has emerged as a destination for the best and affordable healthcare facilities on the Indian healthcare map. Investments are in the pipeline to the tune of Rs, 500 crore by Apollo Group, Rs.750crore by Fortis Healthcare, Rs. 150 crore by Bombay Hospital Trust, Rs. 450 crore by Clinical Islet Transplant Group, Rs. 140 crore by Public Health Foundation of India and Rs.100 crore by Mr Anup Kothari and Mr VC Kapoor. This is expected to create job opportunities for10,000 specialist doctors and para-medical staff, over the next few years.

The Bangalore-based Narayana Hrudayalaya is also considering to set up Gujarat’s largest healthcare facility at Ahmedabad. This Group is planning for a hospital with a capacity of 5,000 beds involving an investment of Rs. 800 crore. The hospital will offer services in the field of cardiology, paediatrics, nephrology, ophthalmology, urology, and gastrointestinal, among others.

Leading zinc producer Hindustan Zinc Ltd., part of Vedanta Resources, a London-listed metals and mining major with aluminum, copper and zinc operations in UK, India and Australia, has plans to set up its zinc smelting plant with an investment of Rs. 4,000 crore in Gujarat. The company is looking for 1,000 acres of land in the State for this project which will convert zinc concentrates into finished products, i.e., zinc ingots.

This is the only company in India operating from mine to finished metals, having met 73% of India’s zinc requirements in 2005-06.The Bharat Diamond Bourse (BDB) is expected to start operation by November 2007 in Surat. It is expected to give a fillip to the efforts by diamond traders and would indirectly benefit the jewellery park coming up in Surat. Foreign buyers visiting Mumbai will have an opportunity to visit Surat to meet with their requirements. The BDB will be equipped with the world-class facilities under one roof and will contribute 90 per cent of the country’s diamond trading activity. Surat accounts for export of cut and polished diamonds worth about Rs.75,000 crore per annum and is home to 90 per cent of global trade in this sector.

The Japanese Government is exploring possibilities to acquire 1,000acres of land in Gujarat for developing an industrial village. For the purpose, Japan External Trade Organisation (JETRO) is looking for land near NH-8, having good infrastructure with port facilities to house Japanese companies at one location. Nissan is said to have plans to set up their passenger car manufacturing unit in Gujarat. The State Government has made a proposal to develop a knowledge corridor teaming up with Japan as also Japanese investment in port development.

Several US-based companies, including Huntsman Corporation, a global manufacturer and marketer of commodity chemicals, Westlake Chemical Corporation, a vertically integrated manufacturer and marketer of petrochemicals, vinyls, polymers and fabricated products, and Shell, have shown investment interest in Gujarat. Moreover, Chicago Board ofTrade (CBOT) which has over 3,600 members trading in 50 different future and option products, is also interested to impart knowledge to individuals trading in various commodity exchanges around the world.

Medical equipment company for manufacturing OEM products targeting new-born babies too is considering plans for Gujarat. Similarly, ITT Corporation, having a turnover of $7.4 billion, has also short-listed Vadodara for setting up a facility for manufacture of high-tech industrial pumps.

More Stories on : Infrastructure | Gujarat

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page