A quick overhaul of the country’s $90-billion urbanisation project to build a Delhi-Mumbai Industrial Corridor is round the corner as the government has readied its plan to allow Japan to be a 26% stakeholder in the ambitious project.
A senior official in the department of industrial policy and promotion told FE, “Japan has not only shown interest but is also ready with their investment plan.?
According to the official, Japan that will be investing $4.5 billion in the project will do it through two Japanese arms ? Japan Bank for International Cooperation (JBIC) and Japan International Cooperation Agency (JICA).
“Japanese prime minister Yoshihiko Noda, who is in India, has expressed interest and said Japan will be investing $4.5 billion, of which $3 billion will be invested through JBIC and the balance $1.5 billion through JICA,” the official said.
The official also added that a formal Cabinet note on the same proposal will be moved for inter-ministerial consultations in a few days and the Cabinet is likely to take a decision by January-end.
FE was first to report that the government plans to offer 26% in the venture to Japan and the proposal is set to see a fresh Cabinet approval.
The Cabinet decision passed in September had said DMIC will be a deemed government company, where 49% stake will be with the government and rest 51%, currently owned by IDFC and IL&FS, will be diluted to other government-owned financial institutions.
With fresh proposal allowing Japan to be a 26% stakeholder, only 25% will be left to be diluted for government-owned financial institutions.
When asked whether the department of financial services has proposed heir final decision on who will be these financial institutions the official added, “This process will take a month’s , though LIC and Hudco remain strong contenders.?
The DMIC Development Corporation (DMICDC) is a special purpose vehicle for implementing the ambitious $90 billion project for building industrial enclaves along Delhi-Mumbai rail corridor, encompassing seven states ? Delhi, Uttar Pradesh, Haryana, Rajasthan, Gujarat, Maharashtra and Madhya Pradesh.