Tata Steel sets up new company in SEZ at Odisha, will invest Rs 2,500 crore
19 June 2015
Tata Steel has set up a new company to spearhead its investment in a proposed special economic zone at Gopalpur in Odisha, seeking to attract global electronics and electrical component makers from China and Southeast Asia and defence sector manufacturers.
The new company, Tata Steel SEZ, will invest close to Rs 2,500 crore in developing infrastructure at the 2,970-acre SEZ.
"We are in advanced talks to bring in electronics companies and defence production units. We hope to make the SEZ a world-class venture. We have appointed Ernst & Young as the marketing consultant to help us in our efforts to attract the best investors," said Arun Misra, VP (Gopalpur Project) and MD of Tata Steel SEZ.
The SEZ is located on land that Tata Steel acquired in the 1990s for a steel plant, which was eventually shifted to Kalinganagar and is due to be commissioned soon. The SEZ project was cleared by the Board of Approvals and is awaiting licence renewal. Land registration is under way, after which the company will apply for notification and then start development and putting the infrastructure in place. Some 1,800 acres will be available for manufacturing units in the SEZ, which is likely to provide employment to 15,000 people.
While an electronics park is due to come up on 300 acres, about 600 acres will be available for defence manufacturing units. The company has already started preliminary talks with the defence ministry on this. While Tata Steel is setting up an Rs 800 crore ferro chrome plant on 400 acres inside the SEZ, the company is making an effort to generate more employment per acre.
"Odisha is rich in natural resources but that does not mean all industries in the state have to be mineral-based," Misra reasoned. Misra, who visited China to scout for potential investors, said the Indian government's 'Make in India' campaign is well known there and elsewhere in Asia and investors are keen to participate in the SEZ. Apart from electronics manufacturing, they include manufacturers of switch gears and insulation panels. The SEZ will also reserve space for heavy engineering companies. "With the Kalinganagar plant due to be commissioned soon, we would like to encourage steel ancillary units to set up shop. A portion of the SEZ, or roughly around 100 acres, will be earmarked for local entrepreneurs and startup companies," Misra added.
A key attraction of the SEZ will be access to Gopalpur port. Investors have expressed the desire to set up base inside the SEZ, targeting export markets in Vietnam and Myanmar.
Tata Steel will consider the prospect of getting involved in operating the port in partnership with other companies.