Karnataka to unveil rs 1,00,000 cr infrastructure projects by 2010

“Government of Karnataka is set to unveil infrastructure projects, including Public Private Partnership projects, worth Rs one lakh crore by 2010 and increase the State GDP from 7% to 9%. We will be creating the infrastructure projects taking into consideration the requirements of the future – we are evolving a 2020 vision that looks into the requirements for all the sectors in this time frame,” said Mr V Madhu, IAS, Principal Secretary, Infrastructure Development Department, Government of Karnataka. He added that the State government is taking the help from a number of experts in preparing the vision 2020 plan, which will be likely to released in January 2010.

Delivering the inaugural address at the Special Session on Karnataka, with the theme of Infrastructure Development Agenda and Investment Opportunities, organised by the Confederation of Indian Industry at EXCON 2009, here today, Mr Madhu said that Karnataka’s road sector needs an investment of Rs 1,25,000 crore by 2020, for energy sector, it needs the funding of Rs 80,000 crores by 2017 and for airport infrastructure, Rs 15000 crore by 2011. The government will come up with ten industrial infrastructure projects in the near future.

He said the government is in the process of selecting a contractor for executing the 35 km high speed rail link project from Bangalore Airport Davanahalli to the City centre. The cost of the project is estimated at Rs 5767 crores. The government has already short listed five consortiums for the project. The project will be implemented in a PPP mode. The Central Government will invest Rs 4010 crore in this project as viability cap funding and the state government will provide the land assets.

The State Government is ready to offer incentives like land acquisition based on the need, easy clearance, provisions for water and power to the investors of the infrastructure projects. He said that the State is giving adequate thrust to the sustainability factor and taking up the Triple Bottom-line approach in infrastructure projects. As per this approach, which is emphasized by the World Bank, the projects should be viable, there should be positive social impact and environment conservation.

He said that Karnataka is now among the top five industrial States in India. It is one among the States that register steady growth in GDP, which is about Rs 2,15,282 crores and is growing at about 7% today. The Government is targeting to increase the State GDP to 9%. Of the one lakh crore worth investment, one third should come from the private sector. Railways alone need Rs 21,000 crore.

Some of the major infrastructure projects to be taken up using PPP model include: 10,000 kms of four-lane road projects for KRDCL at Rs 45,000 crore; Tadri sea port at Haldipur at Rs 4000 crore investment; Davanahally Business Park in a 300 acre land at Rs 9,500 crore and two mono-rail projects in Bangalore on Rs 6000 crore investment.

In his address, Mr G C Indrraj Urs, Additional Director, Department of Industries & Commerce, Government of Karnataka, spoke about the incentives offered by the state government. The private partners on the infrastructural development support for the state will be given incentives like free loan against properties and exemption of VAT for 10 to 12 years. Refund of land possible from 25-100 % for converting agricultural land to an industrial land.100% exemption of entry tax for 5 years. Among these clearances there are three different stages of clearances, where the honourable chief minister will take direct clearance on project about 50 crores and above.

In his welcome address, Mr Vipin Sondhi, Chairman, Excon 2009, said that the State and Central governments have announced ambitious targets for infrastructure development. However, the government should create an enabling environment by addressing industry’s concerns pertaining to land acquisition norms. It should ensure that projects of national importance are speeded up and there is an impressive success rate of PPP projects. The government should give special focus for skill building.

Mr T Parabrahman, Chairman, CII Karnataka State Council provided the concluding remarks and proposed a vote of thanks.