Jharkhand auto component SEZ sends Munda on a high

Jamshedpur | Updated: Nov 21 2005, 06:24am hrs
The foundation stone for the countrys first special economic zone (SEZ), post-passage of the SEZ Act 2005 in June this year, was laid last week by Jharkhand chief minister Arjun Munda.

Located at the outskirts of Adityapur industrial area, around 15 km from here, the first phase of the SEZ, dedicated to manufacture of world-class auto components, has been limited to around 90 acre for now. Plans are on to expand it to around 1,700 acre in the next phase. The SEZ, which will house around 50-60 units, is expected to become functional in a year.

Keeping in mind the immense potential for the auto component industry to grow in the state, especially around the Adityapur Industrial Area Development Authority (AIADA), where around 400 of the 600 small and medium enterprises (SMEs) are engaged in supplying spares/components to Tata Motors and other vehicle manufacturers, within the country and abroad, the state government had, in 2004, appointed AIADA as the nodal agency for the proposed SEZ.

Speaking on the occasion, Tata Motors AP Arya, president of the medium & heavy commercial vehicles division, said many foreign component manufacturers the world over were keen on setting up a manufacturing base in the country. Both Mr Munda and Mr Arya are shortly due to make a presentation in Delhi before leading auto component manufactures for this purpose.

The SEZ, which would be governed by the new Act, which bestows additional concessions, including virtual freedom from inspector raj besides attracting zero service tax, central excise, customs duty for imports, CST, 100% income tax exemption for the first five years and 50% for the next two years, etc., would have units specialising in manufacture of metal-specific components, rubber & plastic-specific components, electrical & electronic-specific components.

The SEZ is expected to bring in minimum foreign direct investment of Rs 5,000 crore while generating employment for around 15,000 persons. While Jharkhand has appointed IL&FS and Infrastructure Development Corporation Ltd (IIDC) as the project development advisors. IIDC has, on behalf of the government, invited and received seven expressions of interest from private sector developers interested in partnering with AIADA/state government in developing the SEZ. It recently appointed L&T Ramboll Consulting Engineers Ltd for preparing a master plan for the SEZ, which is expected to be completed by January 2006.