The Tatas have found a new home for Nano. Describing it as a ‘homecoming’, Tata Group Chairman Ratan Tata, with Gujarat Chief Minister Narendra Modi by his side announced that the mother plant for Nano would come up in Northcote Cattle Farm (in Charodi, Sanand), 30 kms from Ahmedabad—incidentally, about 100 years back Jamsetji Tata had donated Rs 1,000 for establishing the cattle farm, when the state was reeling under severe drought.
The state government today handed over 1,100 acres of prime land for the project, where Tata Group will invest Rs 2,000 crore to manufacture Nano and its variants including an electric car and CNG car. A State Support Agreement was signed by government officials and senior Tata Motors executives.
To begin with, the plant will have a capacity of manufacturing 2.5 lakh cars per annum in the first phase, which will build up to 5 lakh cars per annum. The project complex will also house a vendors' and ancillary park accomodating 60 small and medium units and “could be bigger than the project originally envisaged”.
"We chose Gujarat because of conducive and industry friendly environment as well as infrastructure of the state. It is a special day because we’ve been through a sad experience from a small quarter of West Bengal inspite of the good support from that state government. As a result, time was a major constraint for us. Also, location of the land that was being offered (by the Gujarat government) was very attractive. We were impressed by the pace at which Gujarat government facilitated the project shift including the land acquisition. We promise to become a good corporate citizens of Gujarat and stand for all that Gujarat stands for,” said Tata, adding “Aapde ahiya na chiye ane aapde ahiya paachaa aavya (We belong here and so we have come back here).”
When asked, what benefits Gujarat government had offered for the plant, Tata said that the benefits are slightly better than what West Bengal had offered.
Tatas have bought 1,100 acre of prime land at current market price, which comes to around Rs 3.5 lakh per acre. The integrated project will comprise the mother plant and the vendor park. The project, including Tata Motors’ plant, vendor facilities and service providers, will together generate over 10,000 direct and indirect jobs.
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The development will give a major boost to the auto ancillary industry in the state, as the group also plans to set up Automobile Academy and will also contribute to human resource development.
When asked about the relocation cost of the Singur plant, Tata said, “We are evaluating it and have not quantified the loss. We are trying to retrieve all costs out of Singur. We hope this will not have any effects on our finances in the current fiscal.”
Tata Motors, which had planned to launch the Nano car from around October, had received offers from several other states after announcing its pullout last week from West Bengal, where farmers unhappy with the compensation for their land had forced work to be suspended for more than a month at the factory at Singur.
He said that Tata Motors will establish a new dedicated mother plant with the shortest possible time lag and least possible incremental project cost. “This is Tata Motors’ maiden venture in Gujarat, and will broad-base the company’s manufacturing footprint. We are happy to contribute to Gujarat’s strong industrial progress by creating an auto cluster, which will have a cascading impact on the state’s economy,” he added.
While awaiting the Sanand plant’s completion, Tata Motors will explore the possibility of manufacturing the Nano at its existing facilities at Pune and Pantnagar, and launch the car in the last quarter of this financial year.
He said that the company will try to meet with the launch deadline and launch Nano from one of its existing plants in the country. “We may not have the volumes but we’ll try and meet the deadline,” said Tata.
Narendra Modi, who completed seven years in office today said, “I see this project as much more than a mere investment—I am supporting it in national spirit. After shipbreaking, pharma, petrochemicals and textiles, this project will make Gujarat a force to reckon with in the surface transport sector as well as automobiles. Several countries have invited Tatas to set up the project. If that would have happened, it would been bad for the whole country.”