Gujarat appears to be gaining an upper hand over its southern counterpart as a possible host of the car plant proposed by French company Peugeot, state government officials said.
Though Andhra had offered the best incentive package to the company compared with that of Gujarat and Tamil Nadu, other factors have come into play that might take the plant away from the state.
According to a senior government official, a large corporate house has joined the Gujarat government in actively lobbying for the project for the western state. Mired in political uncertainties that are often marked by public protests and resignations of elected representatives, the Andhra Pradesh government can only wait for a favourable outcome from the company solely on the strength of its offer.
The state has offered close to 1,000 acres of land at a nominal cost apart from promising 33-year waiver in VAT among other things to the company. Peugeot has been delaying its decision on a possible location since March this year.
“Automotive ancillaries, which had recently set up base at Sanand following shifting of Nano plant to Gujarat, are trying to influence the decision of Peugeot in the hope of gaining more business there,” an official of the AP industries department said.