NGO turns SPV for textile park

This is one project for which the government is yet to allot any land or even put infrastructure in place.

Yet, it has taken off and five firms have lined up investments totalling Rs 59.5 crore to set up units as and when land is made available to them.

All because of a non-government body which is working as a special purpose vehicle to promote the concept.

The proposed textile park in the five star Butibori Industrial Estate may be some time in coming.

But the Vidarbha Integrated Textile Park Ltd (VITP), which is coordinating with the government to get land released for the project, has already received confirmed commitments worth Rs 59.5 crore from five companies.

Everything is presently in the air and though the MIDC is said to have earmarked 100 acres for the project, nothing is in black and white. Being promoted under the Scheme for Integrated Textile Park (SITP), which is promoted by the Centre, the project has the blessings of Maharashtra's Minister for Industries, Ashok Chavan and former Maharashtra minister, Ranjit Deshmukh.

In fact, the VITP was formed at a meeting convened under the chairmanship of Chavan on July 30, 2006 when the minister urged the industry to come forward and take advantage of the centrally aided scheme.

Under the scheme, the government gives financial support by way of grant or equity of up to 40 per cent of the project cost or a maximum of Rs 40 crore.

The response that the park is getting shows how a non-government agency, which is charging Rs 11,000 as membership fees and 10 per cent of the anticipated cost of land as a deposit, can project a positive image in the minds of investors.

The amount has to be deposited along with the project report with the VITP whose application for registration is pending with the registrar of companies.

Those who have come forward for setting up units in the park include, R S R Mohta Spinning Mills, Hinganghat, Lords Wear, Nagpur, Handloom Textile Corporation, Nagpur and two promoters of the VITP.

R S R Mohta Spinning Mills has decided to set up an unit of 25,000 spindles involving an investment of Rs 15 crore. Lords Wear, Nagpur plans to set up a garment unit having 500 automatic stitching machines entailing an investment of Rs 8 crore.

Handloom Textile Corporation, Nagpur, will set up a weaving unit by investing Rs 1.5 crore. The unit will have eight powerlooms. Two promoters of VITP will be pumping Rs 35 crore in the park. One promoter will be investing Rs 30 crore in a spinning unit having 25,000 spindles while the other plans to set up a garment unit with Rs 5 crore as investment. Both said it was too early for them to be named.

Confirming the development, Convener of VITP, Abhijeet Gupta said, 18 entrepreneurs have taken application forms from the organisation. An entrepreneur from Gujarat has shown interest for a ginning and pressing unit of Rs 3.5 crore. M. Pee Vee Textiles from Jam in Hinganghat tehsil is studying the possibility of investing in the textile park, he said.

Gupta said representatives of two textile mills Suryalata Textile Mills, Parsheoni and Suryalaxmi Textile Mills, Saoner had also shown interest in the park.

"They want that the park to get power at relatively cheaper rates as is being given to the textile sector in the states of Andhra Pradesh and Gujarat," he said.

VITP will take up the issue with Chief Minister Vilasrao Deshmukh and Ashok Chavan.

Under SITP, the proposed park is to house 40 units having an investment potential of Rs 300 crore. It will give employment to 10,000 people.

The park will have a spinning unit, 20 weaving (air jet) units, four sizing/warping machines, two yarn dying units, one cloth processing house, and two garment and knitting units.