Indore SEZ sell off delayed again

The privatisation process of the special economic zone (SEZ) in Pithampur near Indore is likely to get delayed again with the department of industries of the Madhya Pradesh government mulling over fresh bids for diluting the government's stake in the SEZ.

The process of transforming SEZ Indore into SEZ Ltd, a Rs 200-crore project, is unlikely to take shape this year.

The state government has set up a separate company, SEZ Indore Ltd, with its share of equity participation, taking into account over 1,000 acres of land, cash and other infrastructure.

At present, the department of industries' local arm, the Madhya Pradesh Audyogik Kendra Vikas Nigam (MPAVKN), manages and maintains the SEZ.

The MPAVKN had, last year, invited offers for Expressions of Interest (EoI) from the private sector for majority participation in order to fully develop the SEZ and manage and maintain it. The SEZ is being developed on 1,038.57 hectares (2,500 acres) in two phases.

"Water is the main problem in SEZ for industries," a government official told Business Standard, adding, "We will have to come up with a fresh bidding process to short list a private partner."

The official however did not disclose if the existing consultant "" Tata Consultancy Economic Services "" would be retained.

Flexituff Ltd, Emerald Cigarette and Tobacco Pvt Ltd, Uniwin Packaging, Amulya Exports, M/s Socrus Pharma, SRF Ltd, Ecolife Pharma, Asian Marine Services, Bhaskar Exim and Eden Formulations are a few of the companies which have either been allotted land or have started production

The state industrial department's local arm IAKVN has already allotted land to as many as 15 companies so far and four have started commercial production. Private operators may lose interest if land allotment it gets delayed further.

Tata Consultancy Economic Services had shortlisted seven companies including L&T, Gammon India, Zoom Developers. A company promoted by Anik Group and another by Wartsila. Punj Lloyd and Tata Housing Development had also qualified.

"The state government is slow in the privatisation process. This would mar the growth of the SEZ, particularly exports data," said an industrialist in SEZ area.

Exports during 2004-2005 stood at only Rs 55 crore. This was the second lowest exports in India from a SEZ after the Jaipur SEZ, which posted only Rs 5 crore of exports.