Companies

Industry, trade in Karnataka back JVSL as the company is embroiled in a land controversy

Anil Urs Bengaluru | Updated on June 17, 2019 Published on June 17, 2019

Sudhakar Shetty, President, FKCCI

Industry, trade and commerce in Karnataka are hrallying behind Jindal Vijayanagar Steel Ltd (JVSL) whose lease-cum-sale agreement for 3,667.31 acres of land is stuck.

The company had entered into lease-cum-sale land agreement with the Karnataka government for 3,667 acres in 2005-06 for setting-up Vijayanagar Steel Plant at Toranagallu village in Ballari district.

“Now, we need confidence-building measure to encourage investments in the State. The Government must gain the trust of trade and industry in its policies and programme,” said Sudhakar S Shetty, President, Federation of Karnataka Chambers of Commerce and Industry( FKCCI).

“We demand that lease-cum-sale land agreement of JVSL be executed without much delay. As the State is hosting Global Investors Meet (GIM) early next year, the government needs to be demonstrating ‘investor-friendly’ measures,” he added.

Deploring politicisation of JVSL issue and blowing it out of proportion, Shetty said: “It should not be done, especially when States are competing against each other, see our neighbours Andhra Pradesh and Telangana, they are offering direct lease-cum-sale land agreement for any investment over ₹100 crore.”

Kishore Alva, President, BCIC, said, “The facilitation of industry to set up shop in Karnataka is one of the most important tasks of the State government. The present controversy over regularisation of land lease of JVSL is unfortunate and unnecessary. We understand that political colour has been given to the legitimate use of land by a large industry to set up its plant and facilities.”

JVSL’s land-holding

The company is spread across 7,742.06 acres. Of these, for 3,430.16 acres, 29.59 acres and 615 acres (a total extent of 4,074.75 acres) of land company has already got absolute sale deed in 2005 and 2010. “These land parcels were leased out to JVSL for 10 years and have been handed over to the company, in line with the sale deed agreement after satisfying the terms and conditions of agreement through absolute sale deed,” said a senior official in the Industries and Commerce Department.

Now, for the balance 3,667.31 acres of land, the company is stuck as all major parties in the State are opposing the execution of lease-cum-saleagreement.

According to the official, JVSL has so far invested over ₹50,000 crore to build steel facility, ancillary units and other infrastructure and has created 25,000 direct employment and around 2 lakh dependants. The company is also largest exporter of high grade steel and pays about ₹7,000 crore as taxes per year.

Role of Political parties

Bharatiya Janata party (BJP), the principal opposition party in the State, has been vehemently opposing the execution of lease-cum-sale land agreement. Opposition leader in the Assembly BS Yeddyurappa led his party on day-and-night dharna opposing land sale to JSVL.

Yeddyurappa said the government is selling land at throwaway prices and alleged the ruling JD (S)-Congress coalition of taking kickbacks from the company.

Within the ruling dispensation, former senior minister HK Patil, in a series of letter written to Karnataka Chief Minister HD Kumaraswamy, said the execution of lease-cum-sale land agreement is in a hurry. He faulted Industries Minister KJ George of rushing the proposal.

“The JSVL has dues and owes to Mysore Minerals Limited (MML), a State-owned company, about ₹2,000 crore, including interest. This has been ignored while making the leased land freehold in favour of the lessee,” Patil wrote in his letter.

Published on June 17, 2019
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