K'taka to give Dharwad land to Tata Motors

The Karnataka government is ready to provide additional land to Tata Motors, a Tata Group company, at Dharwad to set up their new facility to manufacture and assemble a variety of buses and coaches. Tata Motors is planning to invest over Rs 1,000 crore in this plant.

According to Katta Subramanya Naidu, minister for major and medium industries, government of Karnataka, Tata Motors had submitted a proposal in this regard to the state government in September 2006. The company's proposal is being discussed at the next cabinet meeting, he said.

However, when contacted Tata Motors spokesperson declined to comment on the proposal. "We have formed a joint venture with Brazil-based Marcopolo to jointly manufacture buses in India. But where the plant will be set up is not known," he said.

"We have already held discussions with Tata Motors officials. They have a plant at Dharwad and sought additional 1,000 acres. We are ready to provide them additional land, but the exact extent of land to be given to them will be decided at the next cabinet meeting," Naidu told Business Standard.

According to the minister, Tata Motors has also proposed providing employment to 30,000 people in north Karnataka. The company plans to manufacture 10,000 buses every year.

Tata Motors already has a unit, Telcon, that manufactures construction equipment, set up a decade ago at Belur industrial growth centre, about 10 km from Dharwad on national highway No 4. It has acquired 680 acres of land.

It may be recalled that Tata Motors had announced a joint venture with Marcopolo, the Brazil-based global leader in body building and coaches, in May 2006.

A delegation led by Tata Motors' managing director Ravikanth and vice president T S Tagore had met Chief Minister H D Kumaraswamy in Belgaum in September last year and held preliminary discussion on the proposal.

A senior executive of Tata Motors had told Business Standard that the company would bring fabricated material from Brazil to assemble it with the Tata chassis at Dharwad and then supply it across the country and neighbouring nations.

The company had decided to set up this plant at Dharwad considering its proximity to Mangalore and Karwar ports. In addition to land, Tata Motors had also sought various incentives including tax concessions.

"The company have asked a lot of incentives like deferment of taxes to 20 years, etc. The state industries department is looking into their demands and take a decision soon," Naidu said.