West Bengal Govt to go ahead with Nayachar chemical hub plans

KOLKATA,17th October,2009: The Lok Sabha poll reverses notwithstanding, the Buddhadeb Bhattacharjee government hasn't given up on its industrialization hopes around the proposed chemical hub at Nayachar. It is readying to draft a changed agreement for the Petroleum, Chemicals and Petrochemicals Investment Region (PCPIR).

The chief minister convened a high-level meeting at Writers' Buildings on Friday to do the needful. Among those who attended were other members of the Cabinet sub-committee on industries finance minister Asim Dasgupta and industries minister Nirupam Sen. Others present were land and land reforms minister Abdur Rezzak Mollah, urban development minister Asok Bhattacharya, Left Front chief whip in the state Assembly, Md Masin, and industries secretary Sabyasachi Sen.

According to sources, the meeting was on several industry-related issues, including the PCPIR. Nandigram had figured prominently as the venue for the mega chemical industrial estate and the PCPIR that was to come up near Haldia when the plan was first floated in 2005, and the subsequent agreement was drafted on these lines. After the bloody resistance to the choice of venue (which, experts feel, was a major cause for the Left's reverses), the government has decided to keep its promises unchanged, keeping an eye on the 2011 Assembly elections.

Nayachar is a 64 sqkm island on the Hooghly in East Midnapore. Prasoon Mukherjee, director of New Kolkata International Development (NKID) which through a joint venture with the West Bengal Industrial Development Corporation (WBIDC) is to develop the infrastructure on the island had earlier said the PCPIR is an expense account for NKID, but the government is bent on going ahead with the project.

A senior Writers' official revealed that the revised agreement, with Nayachar as the changed venue, will now have to be clinched between the state, the Centre and NKID. He said those attending the meeting discussed the draft as well as other industry-related issues, such as granting subsidy to Cals Refinery, which will partner the PCPIR. NKID is a 50:50 joint venture between Mukherjee's Universal Success Enterprises Limited, a company registered in Singapore, and Indonesia's Salim Group. Real estate developer Unitech Limited also had a minority equity interest in NKID, but it has recently sold its stake in the firm.

Unitech exits New Kolkata SPV

Kolkata, June 10, 2009: Sells entire 40 per cent stake to partners, won’t say why. Unitech, the country’s second-largest property developer, has exited from New Kolkata International Development (NKID) Pvt Ltd, a special purpose vehicle (SPV) formed to develop several large projects in West Bengal, including the proposed petroleum, chemicals and petrochemical investment region (PCPIR) at Nayachar.

Unitech had 40 per cent stake in NKID, which has been acquired by the Salim group and Universal Success. Sources said NKID was now a 50:50 partnership between these two; earlier, Salim had a 40 per cent stake and Universal had 20 per cent. When asked why Unitech quit NKID, the former’s managing director, Ajay Chandra, said, “I have no comments on this.”

NKID is a 51 per cent partner for the Nayachar project, while the balance is with the West Bengal Industrial Development Corporation (WBIDC). PCPIR apart, NKID has a host of projects over a 15-year period, which include an Eastern Link Highway, SME industrial estates and a deepwater port close to Nayachar island.

Industry observers said one reason behind Unitech’s exit from NKID could be the long gestation period, given the nature of the projects and the huge investments. Though NKID was incorporated in early 2007, some of the projects ran into rough weather with land acquisition, the most important being the PCPIR, which was ultimately relocated from Nandigram to Nayachar.

The investment in developing infrastructure at Nayachar would be Rs 10,000 crore, while the port could cost Rs 8,500 crore. The investments proposed in NKID projects are sizeable. On the other hand, Unitech has run up debt of around Rs 7,800 crore, and plans to cut it by at least Rs 1,000 crore this fiscal. The company has sold assets over the past few months, and aimed to raise around Rs 1,600 crore for the year ending March 31, from sale of non-core assets in Delhi, Noida, Gurgaon and Kolkata. The focus for the company and all other real estate developers now is affordable housing.

Though the Nayachar investments would be made over a long period of time, smaller investments are underway. For instance, four different studies are on. Also, Singapore-based Jurong Town Corporation have been appointed as consultants. Consultants have been appointed for the deepwater port, too. Even with the offloading of stake in NKID, Unitech would have a presence in West Bengal. The company has a residential project in New Town Rajarhat and an IT park, in partnership with the Universal Success group.