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Gujarat clears The Special Investment Region(SIR) ordinance

Gujarat clears The Special Investment Region(SIR) ordinance
Gandhinagar, DeshGujarat, 8 January, 2009

Gujarat has again pioneered and laid down the road map of robust and fast track economic development of the State and the country. On 6th January, 2009, the State Government promulgated a legal framework – The Gujarat Special Investment Regional Ordinance, 2009. The Ordinance gives indication of the commitment of the state Government to set up world class hubs of economic activity on the lines of fast growing countries of the world.

The State Government is very keen to create large size investment Regions and Industrial Areas in the State of Gujarat; and to specially enable their development as global hubs if economic activity supported by world class infrastructure, premium civic amenities, centres of excellence and pro-active policy framework; and to set up an organizational structure with that purpose. The SIR Ordinance provides for the development of such economic hub(s) with global standards. The State has already identified six potential locations to be developed as SIR which include (1) Dholera-Ahmedabad Inbvestment Region (2) Vadodara-Ankleshwar Industrial Area (3) Palanpur-Mehsana Industrial Area (4) Bharuch –Dahej Investment Region as PCPIR (5) Surat-Hazira Industrial Area and (6) Valsad-Umergam Industrial Area.

India is emerging as a major economic power in the world. The competitive advantage of India include a vast market, a large pool of talented human resource who are mostly in the working age group, vast areas of waste land and a variety of natural resources. Gujarat is placed very well to play this role of taking India on a high growth trajectory. Gujarat already contributes a substantial part in India’s industrial production, capital formation and exports. In several products, it is in fact, a national leader and in certain others, a global player. Gujarat has thus emerged as the growth engine of India. However, the potential is still very large and Gujarat must exploit the same for its own development and for growth of the country.

One of the main reasons of economic progress of several countries has been the creation of huge industrial corridors and mega manufacturing and commercial hubs including in Japan, China and South Korea. It is particularly observed that size of such hubs does matter. This helps in the economies of scale particularly in creating and providing robust infrastructure which is uniform and available to all users. In this background, if the State and the country have to achieve a higher growth, a similar pattern may have to be followed. With that objective, the State Government has passed the SIR ordinance particularly to create large size Investment Regions and Industrial Areas in the State of Gujarat; and to specially enable their development as global hubs of economic activity supported by world class infrastructure, premium civic amenities, centers of excellence and pro-active policy framework; and to set up an organizational structure with that purpose.

This strategy of the State Government is complimented with the strategy of the Government of India. Government of India has proposed a project of Dedicated Freight Corridor (DFC) between Delhi and Mumbai. The area of 150 kms on both sides of the DFC will be developed as the Industrial Corridor. 38% of the length of the DFC is falling in Gujarat. As part of this Delhi-Mumbai Industrial Corridor (DMIC), six mega industrial nodes (four industrial areas and two investment regions) have been proposed for the State of Gujarat. Almost one third of the proposed investments of about 90 billion US dollars in DMIC is expected to take place in Gujarat alone. As part of the DMIC project, identified industrial nodes have to be developed as Global Manufacturing and Commercial Hubs. All kinds of infrastructure both within and outside the nodes also have to be developed with global standards; Government of Gujarat has not only given its full commitment for the DMIC project but has been actively working with the Government of India on the same. Even Government of India has suggested to the State to put in place a legal frame work and a dedicated organizational structure for setting up world class industrial nodes.

All this will lead to enhanced economic activities in the State and in the country and will particularly, result into generation of employment for the people on a massive scale. The objective also includes putting to use large tracts of uncultivable land for industrial and other productive purposes and to develop robust infrastructure linking the industrial nodes, our ports, the DFC and other important locations. This will result into enhanced production and productivity, wealth creation and welfare of the community. To achieve this mammoth task, it was imperative for the State to put in place a legal framework and organizational mechanism with such powers and functions, which steer the development of mega investment regions and industrial areas faster and smoother. In the present global economic scenario, the SIR in Gujarat is expected to be a sound global centre of attraction for the investors.

The Ordinance mainly proposes to provide for following matters :

1. The Ordinance enables to establish, develop, operate and regulate the Special Investment Regions in the State.

2. The State Government is empowered to declare Investment Region or Industrial Area and designate them as Special Investment Region (SIR) by notification;

3. An Investment Region will be developed in an area of more than 100 sq. kms and an Industrial area will be developed in an area of more than 50 sq. kms.

4. The Ordinance provides for establishment of a four tier administrative mechanism for establishment, operation, regulation and management of the SIRs. The structure will comprise of an Apex Authority, a Regional Development Authority (RDA) for each region, a Project Development Agency and project specific SPVs. The Apex Authority and Regional Development Authority will make provisions for development, operation, regulation, management, planning and to grant permission and approval for any economic activity or amenity to be established in the Special Investment Region;

5. The Ordinance empowers the State Government for setting up of Project Development Agency and Nodal Company in the form of a government company and assign them the functions like conceiving and detailing of the project, assessing the techno-commercial and economic feasibility, financial structures of projects, environmental issues and solutions, implementing the projects or awarding them to other developers or entities, promoting private sector participation in projects etc. Government has already approved formation of such a project development company in the name of “Gujarat Industrial Corridor Company” (GICC).

6. The Ordinance provides for effective internal dispute settlement mechanism by setting up a three tier system.

7. The ordinance also provides for a single window clearance system. The Apex Authority- the GIDB will be the point of contact for establishing an economic activity, infrastructure or amenity in the SIR.

In the Global Investors’ Summit – 2009, a seminar is also organised on the development strategy of the SIR. Gujarat is the first State which came out with such a unique legal framework. This shows its commitment to strengthen the economy of the State and of the Country.

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  1. Nihar Mankad says:

    This is simply great, Keep it up. We want gujarat to become the best place for investment and wellbeing. thankyou.

  2. Baxis Patel says:

    that is good about gujarat industrial development but what about those farmers who are getting their livelyhood from that?
    any specification for them?

  3. Shailesh Desai says:

    It is good DFC will be coomercialisation in March 2017.Good for trasportation & Nation but what about Farmers who are going to loss thier agricuture land with cheapest & poor rate.DFC has declared agricuture land price very poor & shameful.They have not applied RAA (Railway Amendement Act) 2008 with market price.Allfarmers are cheated & looted with low rates declared in Valsad District.Everybody knows that now a days land price is hike too much,every year rise 30 %.I would simply saying that salry rised double in last one year of Government officers & same officers has declared poor rate for land acquisition.why? Your salary is increased double & land price etting down for farmers?
    Please give justice to all farmers at valsad District 7 declare revised rate for land acquisition.
    shailesh h desai

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