Bharat Forge's SEZ plan in Pune hits another snag

Bharat Forge, the world's largest forging firm, had acquired 1,750 hectares in Khed near Pune in 2007

Forging major Bharat Forge’s plan to develop a special economic zone (SEZ) in Pune have suffered a setback. Farmers from whom the company acquired 1,750 hectares of land in 2007 are protesting against the delay in the project. They have moved the court.

Khed SEZ Vimantal Kruti Virodhi Samiti, a committee formed by the affected farmers, has moved the Bombay High Court and accused the Khed Infrastructure (KEIPL), the company formed for the SEZ, of cheating them.

Bharat Forge, the world’s largest forging company, had acquired 1,750 hectares in Khed (Rajgurunagar) near Pune in 2007.

The SEZ did not take off in the last seven years due to poor response from the industry. It was planned to attract domestic automobile industry and the local suppliers in this area.

The SEZ was a 76:24 JV between BFL and Maharashtra Industrial Development Corporation (MIDC), the state's nodal agency for industrialisation, with the latter handling the land acquisition process. The JV had spent around Rs 290 crore in acquiring the land. The estimated investments required for this SEZ was of Rs 9,000 crore.

“According to the proposed plan, Bharat Forge was to return us 15 per cent of the developed land. Also, the land was acquired for setting up of an SEZ, so it must be utilised for that purpose, not for any other purpose. It is illegal to acquire land for another project from the same farmer who has already lost land for an earlier project. Because of the delay in the project, not enough employment has been generated, which was promised to us. Hence, we have filed a suit in the Bombay High Court against forceful land acquisition around three months back,” said Balasaheb Mashere, adviser of the Samiti.

An email sent to Bharat Forge did not elicit any response. However, a few months ago in an interview to Business Standard, Amit Kalyani, executive director, Bharat Forge, had said: “We are expecting to get clearance soon. We have clients waiting for the clearance but the state government has not taken any decisions.”

Mashere, a farmer who sold 18 acres for the project, said, “The farmers have been agitating since 2013, when the state government zeroed in on a part of the SEZ land for locating the Pune greenfield international airport project. But now we are completely disappointed, with the original industrial project not taking off.”

Since the company had promised to return 15 per cent of the developed land back to the farmers, about 15 per cent of the compensation was withheld and about 977 farmers were given share certificates of Khed Economic Infrastructure Private Ltd (KEIPL). The shares are of zero value with no sign of the project.

In August 2013, Bharat Forge had announced that it plans to convert its Chakan SEZ into an integrated industrial area and become the first company to take advantage of the Maharashtra government’s new industrial policy, which allows developers to exit projects to build industrial parks. Even that has not been materialised properly, said the farmers.

Recently, the Maharashtra chief minister has stated that after getting approval, if industrial activity does not start on the land, then the developer should be penalised and the land should be given back to farmers or transferred to other industrialists.  

Additionally, according to the new industrial policy unveiled in January, the Maharashtra government offered developers an exit route from SEZs by allowing them to use 60 per cent of the land in their possession for industrial purposes, 30 per cent for commercial (including residential) developments and 10 per cent to build social infrastructure like schools, hospitals, roads, water and sewage treatment plants.