Alleging discrimination, MSMEs of Sanand threaten to shift business to Madhya Pradeshhttps://indianexpress.com/article/india/alleging-discrimination-msmes-of-sanand-threaten-to-shift-business-to-madhya-pradesh-5053791/

Alleging discrimination, MSMEs of Sanand threaten to shift business to Madhya Pradesh

Claiming that small entrepreneurs in Gujarat are being ignored, while "VIP treatment" is being dished out to their counterparts from Japan, a group of about 200 MSMEs who have been allotted plots in Sanand GIDC near Ahmedabad have surrendered their plots to the government.

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Members of Sanand Industrial Association accuse the state government of ignoring their concerns at a press conference organised at Ahmedabad on Tuesday. (Express Photo by Avinash Nair)

Claiming that small entrepreneurs in Gujarat are being ignored, while “VIP treatment” is being dished out to their counterparts from Japan, a group of about 200 MSMEs who have been allotted plots in Sanand GIDC near Ahmedabad have surrendered their plots to the government. Now some of these entrepreneurs plan to shift their business to neighbouring Madhya Pradesh.

“A delegation from the Sanand Industrial Association will be visiting Indore on February 9 to scout for industrial plots where we can set up our business. We have received an invite for the same from the Madhya Pradesh Audyogik Kendra Vikas Nigam (MPAKVN),” said Ajit Shah, president of Sanand Industries Association that represents MSMEs operating in the Bol industrial estate set up by the Gujarat Industrial Development Corporation (GIDC) that houses the Tata Nano and Ford Motors units.

“This government and it’s GIDC (nodal agency that is in-charge of setting up industries in the state) is laying out red-carpet for the industries from Japan, while it is totally ignoring the needs and concerns of local industrialists,” said Shah claiming that industries in Japan were being offered land at 10 percent discount at Hansalpur (about 36 kilometers from Sanand), while the MSMEs were asked to cough up the prices decided by the GIDC. “If we sublet an allotted plot, the GIDC charges us a premium of three percent of the allotment price of the plot. This is just one percent for industries from Japan,” he added.

“We do not have any problem with the Japanese. All we are saying is that we should not be discriminated and should be offered similar discounts,” the official from SIA said.

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Alleging discrimination by the bureaucrats who are currently heading the GIDC, members of the association said that about 200 units — that had proposed to park an investment of Rs 1000 crore — have already surrendered the industrial plots allotted to them in wake of the huge penalty imposed by the GIDC for failing to commission the units within the stipulated two years of allotment.

“We are being asked to pay a penalty for not commissioning our units within the stipulated two years after the allotment of the plots. This penalty together with the interest had touched estimated Rs 300 crore in 2015,” said Atul Shah, the treasurer of SIA. According to him plots began to be allotted from 2011 onwards and the infrastructure like power, water supply, roads and drainage were built by the GIDC only in 2015. “How can smaller players build units in an industrial estate that was devoid of basic infrastructure,” he asked. The SIA had approached the Gujarat High Court in 2016 against the imposition of penalty by the GIDC.

“The GIDC will not give us the lease deed of the allotted plots, without us paying the penalty. Without this lease deed we cannot approach the banks for funding, thus we are forced to surrender the plots,” Atul Shah said.

When quizzed about the issues faced by the MSMEs in Sanand, D Thara the vice-chairperson and managing director of GIDC told The Indian Express, “This issue happened even a year ago. They had also gone to the court. Just 20 days back, we had reached an agreement wherein we had asked them to ahead with the investments, after giving us a bond that they will accept the whatever ruling the High Court gives.” The officer said she received a “thank you” letter from the SIA for the decision.

Stating that notices were being issued to only those who were not utlising the land allotted to them, Thara said the GIDC was also sorting out the issues faced by MSMEs case-by-case. “We had also told them, you submit your case, and we will waive your penalty based on facts. We cannot hide anything… This probably has some other motivation, who knows,” she said adding that there have been several instances in the GIDCs where people “hoard land”.

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