In order to avoid a future Singur-like situation of farmer protests over land acquisition, the country?s largest carmaker Maruti Suzuki has decided that it would create skills development hubs around its proposed third facility in Gujarat and recruit a chunk of the manpower trained in the institute back into the company. This was one of the assurances the company has given to Gujarat chief minister Narendra Modi in the meeting on Tuesday. The company feels that skills development alongwith necessary employment opportunities would go a long way in mitigating any possible disruption in land acquisition, chairman of Maruti Suzuki RC Bhargava told FE.
The move is significant because Maruti Suzuki would be investing an estimated R12,000 crore in two phases in the Gujarat facility ? its highest investment in a single facility till date. ?We are going to invest in the development of skills in Gujarat. This would give the trained people employment opportunities. I don’t know why others don’t do the same,? Bhargava added. The company has also requested the state government to support Maruti Suzuki?s efforts in imparting skills to the people of that region. ?The state government supported our view,? Bhargava added. According to Bhargava, the company’s initiative would not require any significant investment but would allay concerns over land acquisition, if any.
Land acquisition expert and member of National Advisory Council (NAC) NC Saxena said that since state governments had not fulfilled the task of doling out jobs to the displaced people companies should come forward and fill the void. ?It?s a good step by Maruti. Others should also emulate the same,? said Saxena. He said that employing the displaced has been the traditional model for land acquisition which is to gather steam. At present Maruti Suzuki has over 50 functional special skill hubs or Industrial Training Institutes (ITI) across the country. In the last financial year, the company adopted 36 ITIs which inculcated skills into 4,000 people. The company would recruit at least 1,600 of these skilled people into the company. The new ITIs have come up in Gujarat, Maharashtra, Karnataka, Tamil Nadu, Goa, Kerala, Bihar and Rajasthan.
Meanwhile, Bhargava said the new plant in Gujarat was an attempt to branch out geographically across various parts of the country and reduce dependency on just one state.
?Gujarat has port facilities which are very important to us in reducing our transport costs when it comes to exporting vehicles,? he said. According to Bhargava and Maruti’s calculations, the company expects a significant turnaround in the export volumes in the longer run. ?We are thinking of the next 10-15 years. As emission norms become more stringent, the world would move towards smaller cars. And I don?t see any reason why India cant become a major exporter of cars in the world,? Bhargava said. He added that if India wanted to increase manufacturing?s share in the country?s GDP to 25% in the next 10 years, exports would have to increase.
FE had reported last week about Maruti’s proposed third facility at Gujarat near Sanand. The company is expected to invest R6,000 crore in the new facility that will produce one million units followed by another investment to expand the facility totalling R12,000 crore. Apart from Maruti Suzuki, the vast vendor base collectively would invest an additional R6,000 crore in Gujarat. Since setting shop in 1984 Maruti Suzuki has invested over R15,000 crore in its two facilities at Gurgaon and Manesar. Currently the company’s total capacity is 1.2 million units per annum which would go up to 1.7 million units by 2012-13 once the two additional assembly lines come up at its Manesar facility.