JobberClub » IT SEZ in Gujarat

Gujarat’s first IT SEZ clicks as Kendle logs on to Mindspace

admin — Fri, 05 Mar 2010 03:59:40 +0000

IBM team explores SEZ for 5,000 employees unit

Gujarat’s first special economic zone for IT/ITES services is all set to kick start next month. US based Kendle group, a leading global clinical research organization (CRO) with about $ 415 million net revenues in 2009, has firmed up its plans to check into Mindspace, a Rs 1200 crore IT/ITES SEZ project developed by Mumbai-based K Raheja Corp on Ahmedabad-Gandhinagar Knowledge Corridor.

The developer has also held some initial talks with IBM as a five member team led by Amanda Garland, director, global strategy, IBM, visited the state and the SEZ on an exploratory basis on Wednesday, said government sources close to the development.

K Raheja Corp has been allotted about 93 acres of government land of which 68 acres is notified for SEZ while 25 acres is for supporting activities. The developer plans to set up about 15 buildings comprising about 10-15 million sq ft of space for IT/ITES.

“IBM is expanding its operations and it is scouting for 4.5-5 lakh sq ft space that can accommodate about 5,000 employees. For this the company is exploring three countries including Mexico and South Africa. In India, IBM is exploring opportunities in Gandhinagar, Hyderabad and Bangalore. The team has given a very positive impression of the state,” sources said.

IBM already has a presence in Raheja’s IT park in Hyderabad and the developer has a good track record with as many as 14 IT parks to its credit, the official added.

When contacted a senior official of K Raheja Corp declined to comment.

A senior government official close to the development meanwhile confirmed that they had given the necessary clearances to Kendle for setting up operations in Mindspace.

Kendle, a Nasdaq listed CRO, said in a recent filing on March 3 that it has received approval from Indian authorities to proceed with development of new operations center in a SEZ in the upcoming Ahmedabad-Gandhinagar Knowledge Corridor.

The new unit is expected to be operational by mid April, it said.

“Continued expansion throughout the Asia/Pacific region is crucial to the future growth of Kendle. The new SEZ operations center will be ideally suited to deliver best-in-class services to our customers seeking high-quality, innovative and cost-effective solutions for their clinical development needs,” said Stephen Cutler, Senior Vice President and Chief Operating Officer.

By 2012, analysts project that more than 65 percent of all FDA-regulated trials will take place outside the United States, according to Kendle. This is reflected in the Indian biotechnology market, which is expected to grow at a compounded annual growth rate of 30 percent, and the Indian CRO market, which is expected to see growth of 49 percent annually, according to the company.

Kendle’s SEZ operations center initially will house approximately 50 associates and is expected to scale up to approximately 300 associates in the near term.

Having missed the IT/ITES bus in the past, about 15-16 IT/ITES SEZs have been approved in Gujarat state in the last three years or so. While some players like DLF have scrapped their SEZ status, others like Vascon Engineering have said in the past that their projects have been put on hold. The state government is also in the process of taking back the land it had allotted for Satyam’s IT park in Gandhinagar. About three months ago, Ganesh Housing Corporation Ltd has sought extension of the validity period of formal approval beyond December 19, 2009 for its IT SEZ near Chharodi near Ahmedabad.

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Real estate hogs state’s IT SEZ space (16 IT sez in Gujarat)

admin — Thu, 22 Jan 2009 18:25:59 +0000

At least 12 out of the 16 proposals approved so far in Gujarat for setting up as many Special Economic Zones (SEZs) in the IT segment have been bagged by real estate companies that have scarcely little to do with IT or related areas.
The implications are obvious against the background of DLF Ltd, India’s largest real estate developer, successfully getting its IT SEZ in Delhi de-notified by the government even after its in-principle approval as an IT SEZ project. This would now enable the company to use 25 acres of land that the government provided for the IT SEZ, for real estate development. With 16 already approved, IT SEZs will corner the largest chunk of the total 60 to come up in Gujarat.

Some instances: One of the IT SEZs is to be set up by the Raheja Group on an area of 27.85 hectares at Koba, Gandhinagar through its developer company Aqualine Properties Pvt Ltd. This is how the group describes itself on its website: “K Raheja Corp is a success story spanned across decades and continues to achieve higher targets relentlessly for quality performance and service in diverse fields of real realty business, hospitality sector and retailing outfits…”’
The group’s vice president A D Prabhu declined to comment on the issue when contacted and suggested talking to its marketing director, who remained unavailable.
Bhavin Mehta, Head (Business Department) of Ganesh Infrastructure Pvt. Ltd., which is the developer company for a 54-hectare IT/ITES SEZ at Dascroi, Ahmedabad also declined to comment on the issue.
Three IT/ITES SEZ developer companies — City Gold Realties Pvt ltd, Calica Construction and Impex Pvt. Ltd., and Gaurinandan Property Holders Pvt. Ltd — with notified area of 10.72 Ha, 52.60 Ha and 16.11 Ha respectively, are subsidiaries of one parent company — City Gold Group. The group’s representative, Sanjay Agarwal, said of the three, City Gold Realties have tied up with a Pune-based IT company, Vascon Engineering Ltd, for accessing the needed IT expertise.
But Vascon Engineering Ltd itself makes no claim about having anything to do with IT. On the other hand, its Website says it is among the top 14 builders in India “Vascon Engineering Ltd. is a construction company guided by Mother nature and makes optimum use of the basic elements of Nature…”, the website maintained.
This is though the prospects of SEZ approvals being utilised for real estate using loopholes in the regulations was one of the major concerns aired even at the ‘India SEZ Summit 2006′ organized by the Confederation of Indian Industry (CII), soon after the enactment of the SEZ Act 2005.
The benefits from getting a SEZ proposal approved begins with the developer enjoying hefty tax and custom duty once the government issues the ‘notification’ of the SEZ. The condition is that a specified portion of the SEZ territory will only house export-oriented units.
But once the whole SEZ or a portion of it is ‘de-notified’ by the government, the developer can turn that holdings into real estate projects. This is possible even though the SEZ Act 2005 has no exit clause, obviously not foreseeing such an eventuality.
Gujarat’s secretary for Science and Technology, Raj Kumar, admitted to this newspaper that “some parties might have some malicious intentions while proposing an IT/ITES SEZ.” He, however, maintained that what happened in Delhi will not be allowed to happen in Gujarat.
“It’s true that the majority of the proposed IT/ITES SEZ are being developed by real estate companies. But in Gujarat we follow the new tenure land policy that makes it clear that no company is given full possession of the allotted land. Failure to fulfil the time-bound terms and conditions of the SEZ Act and not implementing the proposed IT/ITES SEZ would lead to cancellation of land allotment. This land would then be acquired by the government, setting aside all the real estate ambitions of the developers if any,” he said.

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IT companies line up at Raheja, DLF SEZs in Gujarat

admin — Sun, 21 Dec 2008 08:22:22 +0000

Gujarat may have missed the IT/ITES bus earlier, but the two upcoming IT/ITES SEZs by K Raheja Corp and DLF are all set to drive the growth of the industry here. As many as 50 companies are likely to set up shops in the two parks coming up in Gandhinagar.

“Leading IT players like IBM, Oracle, Syntel, Accenture, Patni Computers and CSC are exploring the state for setting up their operations in the SEZ area, according to sources in state government. We are aiming to draw companies like GE, IBM, Cognizant, Genpact, Mphasis and Symantec who have been our clients,” said an official of DLF on conditions of annonymity.

Apart from software companies, financial institutions and banks like HSBC, Morgan Stanley, JP Morgan Chase, Citibank, Otis, Meryll Lynch, Deutsche Bank, HCFC, Countrywide, many of which are clients of K Raheja Corp, are also looking at the state for setting up their operations, said sources close to the development. K Raheja Corp’s Mindspace IT SEZ is coming up in a sprawling space of over 97 acres at Koba near Gandhinagar for an estimated investment of Rs 1200-1500 crore. The phase one of the project will be completed early next year and space will be available for possession from January onwards.

“The real estate prices in Ahmedabad are very attractive as compared to other IT destinations in the country. Besides, DLF and Raheja have been allotted land by the state government at very nominal prices so they can lease it out at a much more competitive price. This will also give a huge boost to the export rate of the state, which has been growing at over 50 per cent CAGR for the past three to four years,” said government sources.

An official of Raheja said they have been in talks with various companies however he refused to divulge names. DLF is setting up Rs 850-crore SEZ in Gujarat which will come up over 25 acres at Gandhinagar near Infocity. “A few multinationals are evaluating the state and conducting studies. However, it will take about 6-8 months before they can make a decision to move in,” said Amit Grover VP- Corporate Marketing. DLF will also offer space of even 5,000 sq ft for lease to accomodate local players including even entrepreneurs, he added.

Although there are close to a dozen IT SEZs coming up in Gujarat, Raheja would be the first to commence operations commercially followed by DLF looking at the work done currently, government sources added.

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After Nandigram fiasco, is Salim Group headed for Gujarat?

admin — Sat, 08 Nov 2008 15:46:42 +0000

After Nano, is one of the biggest Muslim-owned groups heading for Gujarat? Singapore-based infrastructure and hospitality firm Universal Success Enterprises Ltd (USEL), promoted by NRI businessman Prasoon Mukherjee, is seeking to ink a deal with the Gujarat government to pump in Rs 1 lakh crore in a slew of projects ranging from power plants to SEZs and port development, in the presence of Modi. Indonesia-based Salim group too would have limited equity exposure in these ventures.
The group, that exited Nandigram after West Bengal government decided not to go ahead with the petrochemicals SEZ planned there following violent protests by the Trinamool Congress and Naxalites, is said to be largely interested in the Gulf of Cambay and the Ahmedabad-Dholera SIR.

Those in the know are now asking, what Singur is to Sanand, will Nandigram be to Dholera? However, Mukherjee was there at the Vibrant Gujarat 2007 summit, where he promised a lot of investment in Gujarat but not much has come out of it till now.

Last month, Mukherjee had assured a Nanodevastated Bhattacharjee administration that the USEL-Salim combine would invest Rs 5 lakh crore in SEZs, housing, road, townships and power plants in Bengal. But since land acquisition is yet to start for many of these projects, the prospects of investments touching this magic figure appear very optimistic, to say the least.
However, no such doubts exist for the investments planned in Gujarat since the Modi government is said to have assured USEL of arranging the required land by January 2009. USEL proposes to set up a 12,000 MW power plant involving an outlay of Rs 65,000 crore at a coastal location in Gujarat. Besides, it intends to pump in Rs 10,000 crore on a port venture and the balance Rs 25,000 crore on a multi-product SEZ in Modi-land.
Out of 12,000 MW generated, 10,000 MW would be merchant power which would be sold to other companies and the balance 2,000 MW would be for captive use within the SEZ. USEL Energy would implement the power project. It is in the process of acquiring four coal blocks in Indonesia, Mongolia and China for the power ventures in India.

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