Tata Motors on Thursday denied receiving any grant from the Gujarat government and informed that the financial assistance it got was in the form of a loan to be repaid as per the terms of an agreement.

Congress Vice-President Rahul Gandhi has repeatedly accused the Gujarat government of doling out public money to the car-maker for its Nano car project in Sanand.

“The investor-friendly environment created by the Government of Gujarat (GoG) encouraged Tata Motors to set up its manufacturing plant in Sanand...Given the scale of the project and its potential to drive growth in the State, the GoG offered Tata Motors an incentive package in the form of a loan (not a grant), which is to be repaid to the State Government as per the Loan Agreement executed,” a statement from the company said.

A company spokesperson said the money loaned to Tata Motors is from taxes paid by the company. Till date, the State Government has provided a loan of ₹584.8 crore to Tata Motors.

The Sanand project was a part of a long-term vision to make it a leading automotive hub, further enabling Gujarat to contribute to the prosperity and growth of India, the company stated.

“Since the establishment of the Sanand plant, there has been a spurt in economic activity and growth in employment (direct and indirect) within the State, making Gujarat one of the key auto hubs within the country with huge employment generation. The project has also given rise to capital investments which has further resulted in the development of incidental industrial activities and employment generation in small and medium scale industries,” Tata Motors added.

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