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AP, Karnataka, Gujarat in race for petrochem zones

State governments of Gujarat, AP and Karnataka have submitted applications for setting up petroleum, chemicals and petrochemicals investment regions, reports Deepak Joshi.

business Updated: Sep 28, 2007 21:24 IST
Deepak Joshi
Deepak Joshi
Hindustan Times

The state governments of Gujarat, Andhra Pradesh and Karnataka have submitted applications for setting up petroleum, chemicals and petrochemicals investment regions (PCPIR), which are being scrutinised by the department of petrochemicals. The matter will be referred to the inter-ministerial group after scrutiny, said Ram Vilas Paswan, Minister for Steel, Chemicals and Fertilisers, on Thursday.

The minister said the proposals by the state governments were in Vizag-Kakinada, Dakshin Kannad-Udipi and the Bahruch areas. The PCPIR are each spread over 250 sq kms. Maharashtra, West Bengal and Orissa have also shown their keenness to set up PCPIRs, but their applications are awaited.

"The government would be investing Rs 4,000 crore to Rs 10,000 crore in the PCPIRs and is keen on setting up 4-5 investment regions," the minister said. He also said that he would soon take up the industry's demand for a reduction in excise duty on plastic from 16 per cent to 8 per cent with Finance Minister P Chidambaram.

Referring to the national policy on petrochemicals, Paswan said it was aimed at promoting investment in upstream and downstream industries, increasing production and consumption, creating infrastructure and promoting research and development in plastic and synthetic fibres. A national programme on petrochemical development would also be formulated to improve existing technology and research.

The department of chemicals and petrochemicals, with recommendations of the proposed plastic development council, will manage a Petrochemical Research and Development Fund, he said.

"The national policy on petrochemicals contains policy measures to provide a level-playing field, reduce barriers to entry, and increase scales of operation. In the modernisation of synthetic fibre industry, the government will encourage technology upgradation of the synthetic fibre industry," the minister added.

The policy aims to increase investments in the sector, both upstream and downstream by ensuring availability of raw materials at competitive prices, creating quality infrastructure and other measures to ensure value addition and increase exports.

It also seeks to increase domestic demand and per-capita consumption of plastics and synthetic fibres, increase use of petrochemicals in thrust areas and facilitate investment in the emerging areas.

First Published: Sep 28, 2007 21:20 IST