Andhra plans $86-bn SDZ comprising petro complexes

The state Government has appointed the Andhra Pradesh Industrial Investment Corporation (APIIC) as the nodal agency for the project while GTZ-Germany is the technical partner for environmental management. A special purpose vehicle, AP PCPIR Development Authority, is also being formed.

Officials at the APIIC said the PCPIR envisages having manufacturing facilities for domestic and export-led production in petroleum, chemical and petrochemical sectors with associated services and infrastructure. The Centre would provide rail connectivity, highway network and airports while the state Government would provide basic infrastructure including power and water supply.

According to APIIC executive director Murlidhar Reddy, the amount and investment and the size and scale of infrastructure development would be unparallel, and it would change the entire scenario on the coast.

The state Government is expecting over Rs 3 lakh crore ($ 85.75 billion) investment in the PCPIR where ONGC, HPCL, GAIL, Mittal Energy, Total (France), Bharat Petroleum, ISPRL, Continental Carbon, Reliance, Air Liquide, Velankani, Baker Hughes, Biocon and Naturol are set to invest. Officials said, about $ 41 billion worth investment has been committed so far.

Nestling between two industrialised zones, Vizag and Kakinada — both having two ports each and connected to the Golden Quadrilateral — the PCPIR’s USP is also its strategic location as it is well connected both to the outside world as well as hinterland.

There is a frenzy of infrastructure development already in the region. The existing Vizag port is being upgraded for handling PCPIR cargo, the Gangavaram port is scheduled for phase-I commissioning by June 2008 and is dedicated for PCPIR. A dedicated port for Kakinada SEZ is proposed while the Kakinada Deep Water port is also being upgraded for handling PCPIR cargo. The Chennai-Kolkata National Highway-5 and the Vizag-Rajahmundry stretch are being made four and six-laned respectively. The state highway 97 is being upgraded into four lanes to provide fast connectivity to Vizag city while a 138-km long coastal corridor connecting Gangavararm port with Kakinada port is also being planned. A dedicated 220 KV sub-station has already been set up in the PCPIR.

Initially, three refineries with a total capacity of 45 million metric tonnes per annum (MMTPA) would be coming up if the PCPIR proposal is cleared by the Centre’s Committee on Economic Affairs, and the state Government addresses the environmental concerns.

The PCPIR policy was announced by the Centre last May to create special zones where environment is conducive for setting up large integrated petrochemical complexes which offer benefits of common infrastructure and support services of great cost advantage. The PCPIR also includes five SEZs that were declared earlier in 2006-07.

Last month, the PCPIR proposal of Andhra and Gujarat were passed by the Chemicals and Petrochemicals Department, and it would now be taken up for scrutiny by the 15 Central secretaries committee chaired by cabinet secretary K Chandra Shekhar. Depending on their decision, the proposal would be forwarded to the Committee on Economic Affairs.