ADB, IFC pitch in for Mumbai SEZ

The Asian Development Bank (ADB) and the International Finance Corporation (IFC) have in-principle agreed to fund the Mumbai Integrated Special Economic Zone (MiSEZ)to the tune of $75 million each.

"A decision on how much of the funding would be in loans or in equity would be taken after the completion of a due diligence exercise by both the institutions," sources close to the development told Business Standard today.

An ADB team has already visited India on a recce while a team from IFC is expected later this month.

The Gujarat Positra Private Infrastructure Ltd, which is developing the MiSEZ, has also been rechristened as the Mumbai Integrated SEZ Ltd after a board meeting earlier this month.

The company has also submitted its proposal to construct a captive airstrip in the MiSEZ to the Ministry of Civil Aviation.

The MiSEZ is a culmination of two projects "" the Maha Mumbai SEZ and Navi Mumbai SEZ. The MiSEZ has picked up 74 per cent equity in Navi Mumbai SEZ Development Co Pvt Ltd. The remaining 26 per cent stay with the Maharashtra government.

While the Maha Mumbai SEZ will be spread over 2,126 hectares in the first phase, it is over 450 hectares for Navi Mumbai.

Sources said MiSEZ was also in talks with international financial institutions for tying up more funds. "A leading company has already evinced interest to invest up to $ 500 million but is awaiting the SEZ legislation," sources said.

According to estimates made by the company, kick-starting the first phase of the project will require Rs 2,500 crore. Finances from several domestic institutions have already been tied up. These include Rs 500 crore from IDBI and Rs 200 crore from IFCI.

Jurong Consultants of Singapore, which has been appointed master planners and engineers for the project, has picked up a 10 per cent stake. American firm Parsons Brinckerhoff has also picked up a similar stake.

Contractors such as Bouygues of France and Larsen and Toubro have been shortlisted for executing the project. The company has also mapped out its marketing plans through channel partners Kurt Salmon Associates and Ascendas.

The company has also signed agreements with 200 companies for land acquisition and negotiations are on with another 900, sources said adding that firms in sectors such as auto components, micro-electronics, pharmaceuticals, engineering and services were keen to set up units in the zone.

Mumbai SEZ and its financiers

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• ADB and IFC have agreed to fund upto $75 million each. It is yet to decided whether it would be a loan or equity
• MiSEZ Ltd has submitted a proposal to construct a captive airstrip to the Ministry of Civil Aviation
• MiSEZ is an amalgamation of two projects""the Maha Mumbai SEZ and Navi Mumbai SEZ
• The first phase is estimated to cost Rs 2,500 crore. IDBI has promised Rs 500 cr and IFCI Rs 200 cr