Doubts over petro region sops

Government undecided on concessions, but top-level delegation in US to hardsell plan.

Even as India hardsells its petroleum, petrochemical and chemical investment regions to over 30 CEOs of global companies in the United States this week, there appear to be sharp differences within the government over the nature of concessions to these regions.

"While there is a view that these regions should be given the same benefits as special economic zones, the companies are looking for faster clearances and not fiscal benefits," an official said.

A delegation led by Minister of State for Industry Ashwani Kumar will seek inputs on the regions from the petrochemicals and chemicals industry, including leaders of Exxon, Total, BASF and Bayer at Greenbrier, USA, on June 7.

Officials said there were also differences over the minimum area of these zones. "Also, if these regions are spread over 25,000 hectares, who will be responsible for developing them?" an official said.

There is also the question of social infrastructure in these regions, such as, construction of houses, schools and hospitals.

Officials said it was unclear if the infrastructure would be developed by the companies or the state governments.

An inter-ministerial task force formulating a policy for these regions has defined these zones as specifically delineated investment regions with an area of around 250 sq km, including special economic zones, free trade warehousing zones, export-oriented units and other existing industrial clusters.

The government has identified five locations for these regions. These are Dahej in Gujarat, Vishakapatnam in Andhra Pradesh, Mangalore in Karnataka, Paradip in Orissa and Haldia in West Bengal.

The regions will have specific incentives for promoting infrastructure, services, and domestic and export-led production.