7 mega parks will attract substantial foreign investment: Textiles Secy

Upendra Prasad Singh says even as 10 states have expressed interest in PM MITRA, many more are expected to participate when the government invites proposals

Even as 10 states have expressed interest in PM MITRA, many more are expected to participate when the government invites proposals, Textiles Secretary UPENDRA PRASAD SINGH tells Shreya Nandi in an interview. He says the mega textile parks will attract substantial foreign direct investment (FDI). Edited excerpts:
 
What are the states that have shown interest? Are you anticipating interest from overseas buyers or private parties?
 
Based on written communication, 10 states — Gujarat, Karnataka, Madhya Pradesh, Assam, Uttar Pradesh, Andhra Pradesh, Odisha, Telangana, Rajasthan, Punjab — have indicated that they have more than 1,000-acre land and they will be interested in developing a textile park. More states may be interested and we are yet to seek proposals from (all) states. The proposals will be evaluated on a ‘challenge method’ and then selected.

 

Even though 100 per cent FDI is allowed in the textile sector, foreign investment hasn’t been significant due to problems such as land, power, water availability, clearances, connectivity, among others. If we develop a world-class industrial infrastructure in a plug-and-play model, then investors will not have to bother about issues like land availability, infrastructure clearances, etc. We not only expect all kinds of players from the Indian textile industry, but also expect substantial FDI inflow in textile parks.
 
Since the Scheme for Integrated Textile Parks (SITP) did not achieve its objectives in the past, what can be done to make PM MITRA a success? How is the approach different this time?

 
I won’t agree to the fact that the SITP scheme was not a success. Over the last one month, I have visited seven integrated textile parks. Barring one (park) due to management issues, the other six are fully or partly functional. In my opinion, they have done well. But yes, there are a few changes. Tho­se parks are very small and don’t give an advantage of scale as they are spread over an area of 220 acres (or so).
 
Under MITRA, we are talking about a minimum 1,000-acre land. Under the SITP scheme, the state involvement was less, and did not provide land to private players.

 
In the case of MITRA, the state will be providing the land, which is the basic requirement for the allotment of the park. The state government’s involvement will be much more meaningful. There will also be an integrated value chain.
 
That’s why we are going for a mega textile park, instead of a small-sized integrated textile park.
 
What will be selection criteria and key features? When can we expect the guidelines?
 
The textile parks could either be greenfield or brownfield. We will be providing 30 per cent of the infrastructure cost as development capital support, subject to a cap of Rs 500 crore for greenfield and Rs 200 crore for brownfield parks. The other component is Competitiveness Incentive Support (CIS) and will be up to 3 per cent of turnover of a newly established unit.

 
The master developer will not develop the park but also maintain it during the concession period. In case master developer is finalised for a particular site, then there will be a hybrid model — part master developer and part special purpose vehicle (SPV). The Cabinet has decided that master developer will be a preferred model.
 
The guidelines will be notified within a month. The detailed criteria will be a part of the guidelines. Broadly, the selection criteria for the sites could be related to port or road, rail connectivity. Others will be power, water availability and labour laws in the state. Once the site is decided, then the master developer will be finalised.