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Pawan Ruia offers Dunlop, land for IT SEZ

Ruia has offered to set up an IT SEZ on 50 acres of Dunlop land belonging to the Sahaganj factory labour colony, reports Avijit Ghosal.

business Updated: Jan 01, 2008 22:22 IST
Avijit Ghosal
Avijit Ghosal
Hindustan Times

Pawan Ruia, chairman of beleaguered Dunlop India, has proposed what the state government has been craving for a long time. Ruia has offered to set up an IT special economic zone (SEZ) on 50 acres of Dunlop land belonging to the Sahaganj factory labour colony. A similar offer has been made on 50 acres of Jessop land at Durgapur too.

Ruia, chairman of both India's first tyre maker Dunlop and oldest engineering company Jessop, said: "Sahaganj, located just 40 km from Kolkata, with an improved road connection can serve to disperse the IT concentration in Salt Lake-Rajarhat area."

He feels that both the factories do not need the huge land they sit on. Incidentally, the only functioning IT SEZ in the state operated by Wipro occupies only 18 acres.

The proposal served to the chief minister's office and industry department has been received with cautious optimism. "While any proposal to add industrial land in a land starved state is welcome, we have to read into it before coming to a conclusion," said an industry official.

According to the proposal, Ruia would act as developer for both projects, investing Rs 700 crore for Sahaganj and another Rs 675 crore for the Durgapur project.

The screening committee for procuring land for SEZs in the state, appears to have reacted with enthusiasm and has asked for documents proving possession of land by January 10. Ruia has also been asked to submit a report on the market potential of IT SEZ and an undertaking that 75 per cent of the land would be put to IT and ITeS (IT enabled services) activities.

The proposal comes at a time when the state government is hard pressed to arrange land for IT majors like Infosys Technologies, Wipro, ITC Infotech. The total land under Dunlop's control at Sahaganj is 239 acres, of which only 51 acres accommodate the factory.

The labour colony and estate occupy 188 acres, out of which the SEZ would be built on 50 acres. Jessop has 117 acres in Durgapur.

Incidentally, Dunlop is currently passing through a funds crunch that has even seen the state electricity board severing electricity connection from the factory a week ago with no word yet when it would be resumed.

If the special economic zone does eventually come up, Ruia can actually add a vital piece of real estate to the state's IT map. On one hand, it can bring in much needed revenue for the company's revitalisation; on the other it could once again add a completely new economic activity in the industrial belt of Sahaganj.