LG Electronics and Micromax are among a host of companies to have expressed interest for land developed by Delhi-Mumbai Industrial Corridor Development Corporation (DMICDC) in Greater Noida to set up units, sources told FE. DMICDC is still in the process of getting applications from potential investors to lease out land there and will soon finalise the list of eligible companies. While Micromax has formally applied for five hectares of land, LG has evinced interest in acquiring 10 hectares, said the sources. The base prices of land in the Greater Noida project for setting up manufacturing units range from Rs 5,100-11,000 per sq metre (the bigger the size, the lower could be the per unit rates), while those for setting up IT services facilities have been fixed at Rs 20,000 per sq metre. This is because companies need much larger area to set up manufacturing than IT services units. Although DMICDC recently leased out a portion of land developed by it in Shendra-Bidkin in Maharashtra, a first for any of its projects, the land allocation was mainly to small and medium enterprises. The entry of established players like Micromax and LG is expected to give a much-needed push to the DMICDC projects and also reflects the growing importance of the corridor, the concept of which was mooted a decade ago and cleared by the Cabinet in 2011.

Land already developed by DMICDC at four cities—Dholera (Gujarat), Shendra-Bidkin, Vikram Udyogpuri (Madhya Pradesh) and Greater Noida (Uttar Pradesh)—is up for grabs. While a chunk of land at Shendra-Bidkin has recently been leased out, DMICDC is in the process of receiving bids for other cities. The next tranche of land to be allocated to industries will be in the Greater Noida project. Airbus has signed an MoU during this year’s Vibrant Gujarat Summit to set up an aerospace and defence cluster at DMICDC’s Dholera project, but land allocation is yet to start there. Recently, as many as 24 plots, covering 11.15 acres, at Shendra-Bidkin were offered to the SMEs, which fetched Rs 15 crore to DMICDC. Vendree Sales Service, BG LIIN Electricals and Mikronik Gauges are the key companies to get the plots on lease.

According to the model developed by DMICDC, while states offer land, the funds released by the centre usually go towards its development. Once the land is developed, it will be allotted to willing investors at a price and with those funds, DMICDC will acquire another chunk of land and start developing it. DMICDC joins hands with entities of the state governments concerned to form special purpose vehicles, which are the anchors of projects in their respective states. For the Greater Noida project, the corporation has tied up with Greater Noida Industrial Development Authority. By June, the Centre had approved Rs 11,405 crore for developing various DMIC projects, and states concerned have to match this contribution in the form of land. The Centre pumps in money for various DMIC projects through the DMIC Trust.

Japan International Cooperation Agency (JICA)–which has committed $4.5 billion for various DMIC projects, to begin with–is studying two metro projects (one in Haryana and the other in Gujarat) for investment. Once it approves any project, it will release funds accordingly, although the DMICDC hasn’t sought any funds from JICA yet. JICA’s committed funds will be in the form of soft loans at a low interest rate of less than 1%. With an envisaged investment of $90-100 billion by 2040, the 1504-km DMIC across six states was intended to be developed as a ‘global manufacturing and trading hub’. The Centre has committed $4.5 billion for the first phase of the DMIC projects. DMIC is touted as the world’s single-largest infrastructure project. The project was one of the important measures announced by the government to help drive the share of manufacturing in the country’s GDP to 25% by 2022 from roughly 16% now.