Navi Mumbai SEZ May Still Face Some Hiccups

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Mumbai: : The development of special economic zones (SEZs) at Navi Mumbai, on more than 4,000 hectare, may end up a non-starter. The bidders are said to have been pressing for an amendment to bid terms relating to the land price and gross revenue sharing. The bidders comprise Larsen & Toubro, a consortium of Sea King, Hiranandanis and Videocon and another consortium of Anik Development Corporati-on, Tata Housing and May Fair.

The bidders are insisting on reduction in the reserve price of land to Rs 30 lakh per hectare from Rs 45.24 lakh per hectare. They have also emphasised the need for doing away with the bid condition of gross revenue sharing of 2.5 per cent from year one to 8.5 per cent from year nine, to 15 and 7.5 per cent from year 16 onward of topline gross revenue.

According to the bidders, the present value of such share in the gross revenue coming to the state-run City and Industrial Development Corporati-on, which is the nodal agency for the development of Navi Mumbai SEZ, would be around Rs 59 crore for phase-I. The amount of Rs 59 crore at present value does not represent a substantial sum as far as the entire project is concerned.

Nayan Shah, managing director, Anik, MayFair and Tata Housing consortium, said: “The Navi Mumbai SEZ is going to change the economic face of Maharashtra and the government should relax these the larger interest of the state.”

The bidders have told the state that giving away Rs 59 crore in the present value terms is a very small amount for ensuring the bankability and viability of the project.

The objections raised by the bidders are important as the Maharashtra cabinet’s meeting on October 15 offered a host of physical and financial sops for the implementation of the project. The government has offered exemption in all taxes, duties and cess for 20 years on exports, purchases and transactions would also be exemp-ted for 20 years from sales tax, stamp duty, registration fee.

Government sources told FE that these issues could be resolved through negotiations. They said the government was committed to creating a simple and transparent system.

The Mumbai Industrial Relations Act 1946, Mahar-shtra Land Revenue Code 1996, Maharashtra Regional Planning and Township Act 1996, Mumbai Rent, Hotel and Residential rate control norms, Maharashtra Zilla Parishad and Panchayat Samiti Act 1961 would not be applicable to the Navi Mumbai SEZ.