Haryana approves Reliance Industries' quitting SEZ;

Haryana approves Reliance Industries' quitting SEZ;

to give Rs. 343 crore for land

Chandigarh: Reliance Industries' proposal to opt out of Gurgaon special economic zone (SEZ) has been approved by the Haryana government, which hyas said it will reimburse Rs. 343 crore to the company.

The amount offered by the state government for taking back the land is lower than Rs. 1,172 crore demanded by Reliance.

Chief Minister Bhupinder Singh Hooda told reporters in Chandigarh on Friday that RIL's proposal was approved by the state Cabinet at its meeting here.

Mukesh Ambani-led RIL had sought the reversal of 1,383.68 acres - from Reliance Haryana SEZ Ltd (RHSL) to the Haryana State Industrial & Infrastructure Development Corporation (HSIIDC) - saying that the project had become unviable.

An official release said the SEZ Project at Gurgaon had "been rendered economically unviable due to the mid-term corrections in the SEZ Policy viz. imposition of the Minimum Alternate Tax (MAT), withdrawal of the Tax holiday, slowdown in the global economy, prohibitively high prices of land and other problems associated with aggregation of land through private negotiations".

Sensing the difficulties posed in this behalf, the Chief Minister had requested Reliance to return the HSIIDC land, it said.

"As such, RHSL offered to return the HSIIDC land and abandon the SEZ project in Gurgaon vide their letter of January 2012," the release said.

"RHSL had requested for refund of the amount paid by them to the HSIIDC and re-imbursement of expenditure incurred on the site, apart from interest on the said amount aggregating to Rs. 1,172 crore," it added.

The proposal was considered at the level of the Haryana Investment Promotion Board, headed by the Chief Minister, after examining all the legal aspects of the Joint Venture Agreement, it said, adding that HIPB recommended acceptance of the return offer strictly in accordance with the provisions of the JV agreement.

"Accordingly, the Haryana Cabinet today approved the return of the land to HSIIDC, in lieu of payment of an amount of Rs. 343.51 crore to RHSL as against Rs. 399.85 crore paid by RHSL at the time of transfer of land and the demand of Rs. 1,172 crore by RHSL," the order noted.

"The claims on account of Administrative charges forming price of the subject, refund of the Stamp Duty, re-imbursement of development expenditure and interest amount have not been accepted. The refund amount has been worked out strictly as per the terms of the Joint Venture Agreement date 19th June 2006 signed between the HSIIDC and RVL."

HSIIDC and Reliance Ventures Ltd, wholly-owned subsidiary of RIL, had entered into a JV Agreement on June 19, 2006 for setting up of the SEZ over an area of 25,000 acres in Gurgaon and Jhajjar districts.

HSIIDC had transferred about 1,383.68 acres at Village Garhi Harsaru to the special purpose vehicle floated by HSIIDC and RVL for implementing the project - Reliance Haryana SEZ Ltd, for about Rs. 399.85 crore.

The project configuration was subsequently changed to SEZ in Gurgaon district over 12,500 acres and a Model Economic Township over 12,500 acres in Jhajjar district. Reliance was able to purchase, and aggregate, about 7,100 acres in Jhajjar, and another about 1200 acres in Gurgaon, but it was not contiguous.

RHSL also paid Annuity to the landowners whose land was acquired/procured in Gurgaon & Jhajjar amounting to Rs. 50.71 crore up to March 31, 2013. It included Rs. 17.61 crore on HSIIDC land in Gurgaon and balance amount of about Rs. 33.10 crore in Jhajjar where they had procured land through direct negotiations.

Soon after the Haryana government received the land return offer from RHSL, it has been engaged in discussions with the Union Ministry of Commerce & Industry for the best utilisation of the subject land, the release said.

"It has been agreed with the Ministry of Commerce & Industry to use the subject land for establishment of a state of the art Global City Project as a send investment node under the Delhi Mumbai Industrial Corridor (DMIC) Project," it further said.

"The Global City is envisaged to be developed as a high value added manufacturing infused area which, apart from adding to the economic development, would also help in generating skilled employment in Haryana."

Mr Hooda said the land acquired for the Reliance project would not be returned to the original owners of the land. The new project is envisaged to be an integrated model township in Gurgaon, comprising of the exhibition and convention centre, high value innovation and knowledge industries, central business district and township facilities.

The Global City Project is proposed to be developed jointly by the HSIIDC and the DMIC Trust/DMICDC through a special purpose vehicle (SPV) with equity participation by DMIC Trust and HSIIDC in equal proportions.

Reliance asks Haryana to declare agri land as urban

Reliance asks Haryana to declare agri land as urban

Reliance Haryana SEZ Limited (RHSL), the special purpose vehicle (SPV) incorporated to implement the now-shelved Special Economic Zone (SEZ) project in Gurgaon and Jhajjar districts, has asked the Haryana government to declare as "urban" chunks of agricultural land in Gurgaon district which the company had bought from farmers.

Reliance's request is being viewed as an effort to seek exemption from the land ceiling provisions in Haryana. As per the Haryana Ceiling on Land Holdings Act, the permissible area allowed for an individual to possess ranged from 18.12 to 54.5 acres.

However, an amendment was made in the Act in October 2011, which exempted land acquired for non-agricultural purposes and falling within an "urban area" as defined in the Haryana Development and Regulation of Urban Areas Act from the ceiling law.

The RHSL, a joint venture of Mukesh Ambani's Reliance Ventures Limited and Haryana State Industrial and Infrastructure Development Corporation (HSIIDC), had purchased 1,200 acres of agricultural land in Gurgaon district and 7,000 acres in Jhajjar district for setting up two SEZs.

The projects, however, stand shelved as Reliance got the structure of the SEZ project in Jhajjar changed (a model economic township will now come up instead). The death blow to the SEZ project came in January when the state government asked Reliance Industries to return 1,383 acres transferred by HSIIDC to RHSL in 2006 as the SEZ project could not fructify for the past six years. The in-principle approval for extension of the multi-product SEZ at Gurgaon, given by the department of commerce, government of India, also expired on March 31.

The SEZ prospects at Gurgaon looked grim from the beginning, with the in-principle approval granted by the union government for the SEZ expiring in March 2009 after two extensions.

While the RHSL has already got the agricultural land procured for the SEZ project in Jhajjar declared an urban area through a February 14, 2011, notification issued by the town and country planning department, it has now stepped up efforts to get the chunks of purchased land in Gurgaon district declared urban. Besides exemption from the ceiling law, getting this land declared urban will also help Reliance get industrial licences for it.

The development also assumed significance since the draft development plan of Farukhnagar in Gurgaon district was approved on Tuesday by a state level committee of the town and country planning department under the chairmanship of chief minister Bhupinder Singh Hooda. A large chunk of land being sought to be declared urban by Reliance is in the Farukhnagar controlled area.

Principal secretary, town and country planning, Sudeep Singh Dhillon, when asked about the request from Reliance, said: "They can file an objection once the draft development plan of Farukhnagar is notified. After that, we can examine whether they can be accommodated or not. The power to accept or reject the objection rests with the state government."

Reliance official Amit Vij told HT on Thursday that the request for declaring agricultural land as urban was a mere formality. "As per our agreement with HSIIDC which is a joint venture partner, we can also undertake industrial activity on this land,'' he said.

Asked whether Reliance after aggregating the land was now turning into a real estate developer, Vij denied it.

The RHSL, in a communication to the Town and Country Planning department, has said that while most of the land (in Jhajjar) is now part of urban areas as well as the controlled area, it is requested that land falling in Farukhnagar and Gurgaon controlled areas, presently outside the urban areas, be declared urban.

"This would facilitate our ability to undertake further procurement of land so as to enable development for industrial/institutional purposes," the RHSL wrote.

The company has specifically requested that chunks of land falling in Mubarakpur, Iqbalpur, Sultanpur, Budhera, Jhajrola, Makdola and Kaliwas villages be declared urban.

"When we look at combined maps of the Gurgaon Manesar development plan-2021 and 2025, Farukhnagar controlled area and Jhajjar district, we find an area consisting of parts of these villages situated within these three areas which is not declared urban presently. The RHSL has purchased land for the development of SEZ/Model Economic Township projects and some of the area is situated in between these zones," it said.

Reliance has also requested that portions of land in these villages, which are part of the Farukhnagar draft development plan, be earmarked as industrial/institutional zone.

"The same may be reflected in the final development plan of the Farukhnagar controlled area. Also, the area meant for the development of the project in Jhajjar and Gurgaon be not marked amenities zone as reflected in the draft development plan of KMP (Kundli-Manesar-Palwal)," the communication said.

Reliance proposes to demerge model township at Haryana SEZ

Reliance proposes to demerge model township at Haryana SEZ

Reliance has proposed to demerge the model township from its Jhajjar Special Economic Zones (SEZ) in Haryana.The demerger will be subject to the approval from the Haryana State Industrial and Infrastructure Development Corporation (HSIIDC).Reliance has signed a pact to induct IL&FS into a new company. Reliance Ventures will have 45% interest, while IL&FS and HSIIDC will have 45% & 10% stake, respectively.The company was asked to return the land during a meeting between RIL chairman Mukesh Ambani and Haryana Chief Minister Bhupinder Singh Hooda in New Delhi on January 17. Hooda had suggested that since the SEZ project had got delayed by over six years it would be better that the land be returned. The SEZ was to be set up in 2006 through a special purpose vehicle — Reliance Haryana SEZ Ltd — created after a collaboration between Reliance Ventures, a wholly owned subsidiary of RIL, and HSIIDC.

SPECIAL ECONOMIC ZONE OF RELIENCE

Special Economic Zone of Relience

After the MoU for setting up the country’s largest SEZ (25,000 acres) was signed between Anand Jain, one of the directors of RIL, and Rajiv Arora, MD, HSIDC, Mr Ambani said, “What differentiates Haryana from other states is the sheer scale of development. We have a lot of respect for the state government.”

Reliance has incorporated a company by the name of Reliance Haryana SEZ to set up this multi-product zone. For the development of the project, it will enter into an equity arrangement with HSIDC, the ratio of which will be determined shortly. A special committee will be constituted to identify the land for this project. It will comprise two members from HSIDC and two from Reliance.

The land is in the Jhajjar-Bahadurgarh belt. (Villages near Garhi Harsaru (26.6 Kms.) in Gurgaon — Khandsa (29.2 Kms.), Narsinghpur, Mohammedpur, Gadauli and Harsaru and villages of Jhajjar) — Talking to ET Mr Ambani said, “The land would be finalized within two months time and the first benefits of the SEZ would start accruing to the state in 24-30 months. We are keen on an expeditious completion of this project.” As regards the quantum of investment, he said, “There is no cap on investment.

The idea is to develop the critical mass. Development of infrastructure is a continuous process but considering that the project would be developed over an area of 25,000 acres, the investment could anywhere be between Rs 25,000-40,000 crore. The competition of this SEZ will not be with the SEZs of other states. We would be competing with the most favored investment destinations such as Singapore, Malaysia, Dubai and China.”
The SEZ by Reliance would be in addition to nine SEZs already approved in principle by the Central Government in Haryana. Mr Hooda told ET, “Our endeavor is to make Haryana the ‘Numero Uno’ state in the country. The Reliance SEZ would be another feather in our cap. Not only would it bring in a lot of investments, it would translate into direct and indirect employment for around four lakh people.

”In the SEZ, 6,500 acres have been earmarked for low polluting industries, 5,000 acres each for basic infrastructure and commercial establishments, 3,750 acres for residential area, 1,250 acres each for institutional area, leisure and entertainment.
In a conversation with ET Anand Jain, director, RIL said that the SEZ would involve a diverse portfolio of industries. “The areas that could be successfully developed in this SEZ are automobiles, auto components, agro based industry, biotech, IT and garments. We would strive to get the best of the Fortune 500 companies to invest here,” he added.

Reliance Venture Ltd. is developing a 2,000-MW gas-fired project as part of a special economic zone in Haryana State. Haryana Govt. has notified for public objection against environment clearance. A team of Mukesh Ambani’s Reliance Industries Ltd recently met aviation ministry officials to kick start the proposed cargo airport at their ambitious SEZ project in Jhajjar. The airport and a 2,000-MW power plant were the highlights of the Rs 40,000-crore project that will be spread over 25,000 acres in Gurgaon and Jhajjar.

IL&FS Equity

Last month, (Jan 2011) IL&FS had completed the purchase of a 45% stake in Reliance's Model Economic Township (MET), comprising 10,000 acres of land, in Jhajjar, Haryana.