Price fight hits leather studio plan

The proposed leather goods park in Kolkata seems to have run into rough weather over valuation of the land within Calcutta Leather Complex (CLC), threatening the prospect of setting up a design studio with central government funds.

The leather goods manufacturers have offered to buy plots at Rs 1,300 per square metre within the CLC. However, the BOT builder, M L Dalmiya & Co., has refused to scale down price below Rs 1,670 per sq.m..

The producers have maintained that the cost of the land should not exceed Rs 1,200/sq.m. but they were still ready to go up to Rs 1,300/sq.m.. They have demanded that the government should give land outside CLC for the leather goods park.

However, the state has clearly told the manufacturers that the park must come up within CLC.

"We have asked both parties to come to a settlement over the price as the park should come up within CLC," a government sources said.

However, the imbroglio over the park has put the proposed design studio in jeopardy.

The studio is supposed to come up within the leather goods park. The Planning Commission has promised to give Rs 5 crore to develop the studio under Integrated Leather Development Fund (ILDF).

The money is supposed to be drawn from the Centre by September 30. If that does not happen, the fund would go back to the Centre.

Council for Leather Export (CLE) is the implementing agency for the project. It had also roped in Italian assistance to develop the studio.

The arrangement to this effect was made during chief minister Buddhadeb Bhattacharjee's visit to Italy last year.

CLE is supposed to make a detailed project report for the park and also secure counter guarantee for performance from the special purpose vehicle (SPV) which is supposed to be set up for the design studio.

Given that the site for the park is yet to be identified, a DPR for the studio cannot be preapred now. Even if the leather goods manufacturers and BOT entity resolve differences following government intervention, time to complete the formalities as laid down under ILDF is running short.

Similar studio projects are being execute under schedule in Agra, Ambur and Nellore but West Bengal may lose the project.