Spare 3% of production for society: Guj to new cement units

If you are planning to set up a cement plant in Gujarat, get ready to spare three per cent of your net cement production for social causes. With a view to passing on the benefits of growing investments to social sector, Gujarat government wants three per cent of the net production of any new cement plant in the state to go into developing the neighbourhood areas of the plant.

"The government is tying up with NGOs and other institutions, which will monitor the distribution of cement for infrastructure and housing projects in the surroundings of the plants. Three per cent of a plant's production will thus be channelised into corporate social responsibility (CSR) activities," said a state government official.

The state government will sign memorandums of understanding (MoUs) with non-government organisations (NGOs) apart from other social institutions during the biennial investment summit starting from January 12, 2011. The main role of these social institutions would be to facilitate the process of passing on 3 per cent production for CSR activities.

The latest move of the state government assumes importance in the wake of nearly Rs 60,000 crore investments likely to be committed in the cement sector during the two-day Vibrant Gujarat Global Investors’ Summit, a brainchild of Gujarat chief minister Narendra Modi.

As per the government sources, corporate giants such as ACC Cement, Adani Group, Anil Ambani-led Reliance Group, Indiabulls and Calcom Cement are going to ink agreements with the state government for setting up plants in Gujarat during the summit. These projects would be implemented in joint venture with state-run mining major Gujarat Mineral Development Corporation (GMDC).

Banking on the rich reserves of close to 12,000 million tonnes of limestone, Gujarat is planning to increase its cement manufacturing capacity around three fold in the next three to five years. The state now ranks fourth in the country in terms of cement production, which stands at 20 million tonnes per annum (mtpa). The state government target is to take it up to 70 mtpa in five year's time. It may be mentioned here that major companies like L&T, Sanghi Cement, Ambuja Cement, Saurashtra Cement, Grasim and Siddhi Cement already have operations in the state.