THE SOUNDS ARE GOOD BUT IT IS STILL NOT MUSIC ON THE GROUND

HERALD: A brief opening remark Atul on the investment policy and where are we post the declaration?

Atul Pai kane:  The Investment Promotion Board (IPB) is going to be notified in a short time. The IPB as a part of the Goa Investment Policy  followed by the Governor’s assent means we now have to hit the ground running

HERALD: Shekhar are you happy with the movement post the declaration of the policy or do you feel more should have been done?

Shekhar Sardessai: Well the gap that needed to be covered has been covered. From the perspective of translating the policy to action in the form of creation of the board and the legislation that has gone into the creation of it makes it a truly single window system.

HERALD: Does the board supersede bodies like the GIDC, GSIA?

Sardessai: I think there is a provision in the act that states that unlike the statutory body, like the pollution control board which cannot be superseded, there are state bodies within the purview of the state government where it clearly states that if they don’t do their job then the board will have overriding powers.

Martin Ghosh: I want to clarify it is not an overriding power. The IPB will be a facilitation as well as grievance redressal mechanism. So if today if any unit is stuck in a predicament and that particular department is not able to resolve it , the appellate authority is given to the IPB. It is more of a facilitation window , there is no such thing that it overrides.    

Parag Joshi: Basically it is not interfering directly with the GIDC ,the idea is that we all function together to work as a single window.

HERALD: According to you what are the challenges? Are you confident this policy will become practice and if yes why?

Joshi: Whatever doubts which were there earlier.. definately now after this Make in India concept of the PM it is going to be a success. I’m 110 % sure.

HERALD: Having said that what are the challenges?

Joshi: Land availability is one of the biggest challenges as far as Goa is concerned and yes power and   quality of power is too. 

HERALD: Martin what do you think met the confidence of giants like your company?

Ghosh: We have been in Goa for 40 years , so that comes along with some amount of baggage. In the sense we are comfortable being here which is not to say that everything here is rosy. So if we compare on all India basis we are quite happy to be here of course when we do make investments we measure against globally and we take certain decisions. I think overall there are concerns with the infrastructure that we have here in the country in general, procedures take a little long in which Goa is more acceptable but we are more comfortable here than elsewhere.

HERALD: Mr Kunkolienkar, going back to two core issues of land and power first let us look at land. Now the government  needs a certain amount of land. If you could elaborate what the quantum could be and where will we get this land from?

Nitin Kunkolienkar: First IDC is trying to unlock land which is blocked by many people, maybe because many could not complete the projects. Or land was taken just as an investment or speculation. The corrective process is on and many people will surrender or have surrendered it.

HERALD: Currently IDC has no land to give away unless it unlocks, so what is the mechanism for unlocking?

Kunkolienkar: Unlocking like what you did for the IT park , where you give a 10 or 20% where you come at a mutually agreeable formula which is transparent  and give investors the option to surrender the land . Many guys had the projects but because of recession could not carry it out.

Pai kane:  I simply think the first attempt should be to get the SEZ land back. And if you have to, make a deal as long as the balance land given to the SEZ become non SEZ and is  within the land use policy of the GIDC. 

HERALD: You mean the 30% which remains with them?

Pai kane:  Whatever figure you agree on 20%, 30%, 80:20, what ever remains is with the current lessee. It can be used only for industrial purposes as per the current land use policy of the GIDC and not for anything to do with housing, tourism, or anything of that sort

HERALD: That has to be specified.

Pai kane:  Absolutely

HERALD: So a Raheja for example will not use it to build his housing estates.

Pai kane:  No chance, if he constructs a IT space and offers shell space to companies who come and set up companies quickly, (only then). I  agree the government  has to make a deal. It will free up 4 million sq mtrs of land which I think is more than our requirement for the foreseeable future. 1.2 will remain withSEZ promoters and can also be used  for industrial  purposes. So practically free up the entire land and it will not be SEZ land anymore. So that fight against sez is over the land availability is completed. GIDC is also looking for land banks. They have been identified and they have to started procuring the land. They have land available in Sanguem, Bicholim, Poinguinim,

HERALD: Where is this land, orchid land?

Sardessai: Sujay, what do you think you would do in terms of getting more land for Goa?

HERALD: Free up all the land locked up by all the departments. They hoard land. For instance the sports city land at Dhargal, is still in possession of sports dept, not released. The government has so much land locked within its own self. They need to unlock land under their own command. The feedback I get from informal conversations with ministers is that the govt has not been able to unlock land easily without litigation.I think the land policy, its acquisition, unlocking it, should have been dovetailed a lot more into the investment policy otherwise it becomes toothless

Ghosh: I remember on land there is a statement in the policy that earmarking of land would be one of the tasks of the IPB, the CEO has to think where. Pockets of land may be available but may not be ideal for industry. When a new board comes they look at things differently. I think the earmarking of land should  be done.

HERALD: My concern is since you (addressing Martin Ghosh) were involved when the policy was being drawn up was there application of mind on this issue or is this application of land happening post facto?

Ghosh: We took land seriously. It is one of the enablers in the document. We have seen the lay of the land that is not in eco sensitive zones, I think the quantum of land available is adequate.

HERALD: You are saying a new investor should go to IPB?

Pai kane:  IBP will have to get land from GIDC, changes have to be made in the land, new notifications will have to be done.

HERALD: What are the timelines from the first brick being laid and the first product being rolled out?

Pai kane:  The government has been giving out land for  four to five months with 25 units given clearances. We are meeting once a month and clearing projects.  I am part of the steering committee.

HERALD: This screening committee was doing the job of the IPB in the interim. So what were the kind of industries who appplied?

Pai kane:  A Spanish pharma company called Ordain, an R&D firm, a fish processing unit, a garment processing unit, couple of IT companies , a textile unit, a chemical unit , a manufacturer of controlled devices and a company  with Russian technology for water purification. They got around 25,000 sq mtrs.

HERALD: Coming to power and the challenges you faced. Let me start with Mr. Ghosh. All of you went through a harrowing time with the Reliance contract for power supply coming to an end. Just share your concerns based on the experience.

Ghosh: Firstly there is a shortage of power in Goa and in India. To grow you need more power, either generated or procured.

HERALD: If the Rs 25,000 crore dream investment comes you will need another 300 megawatts.

Ghosh: I think we will need much more than what we are getting now. Something needs to be done on the procurement of power, secondly on the transmission and distribution of power. While the customers of R-Infra had to pay large amounts , the quality of power was exceptional. So what we need is power at reasonable price at that quality. It will give Goa a competitive edge over the other states. Compared to other states we don’t have holidays, we have some informal load shedding, our rates are low compared to other states so we have an advantage. Industry is willing to pay.

HERALD: Where do we stand now?

Ghosh: Significant work needs to be done 

HERALD: Right now you are depending completely on government power.

Ghosh: Yes and captive power.

HERALD: The coal blocks are no longer there, the CM is saying you have to buy power at a higher cost.

Ghosh: It is a thermal plant which is most cost effective, even if we have to pay 50 to 70 paisa more industry will be happy. Provided you get quality power. Even civilians will like good quality power. If the state gets good quality power it will be a game changer

HERALD: Are you confident of getting it given the recent experience?

Kunkolienkar: The government will quickly act after the Supreme Court judgment (on the coal block cancellations) and some action will come in 3 or 4 months regarding re allotment. We don’t see much of delays .

Pai kane:  One of the challenges is distribution, we believe the GIDC should be the accumulator and they should set up their own substations and they should distribute. The new guys who come should not suffer like we did. The cost of electricity is almost one third compared to the neighbouring states. Maharashtra charges Rs 9 a unit and this is not to say it is great power but you still need to back it up. Goa it is at Rs 4 a unit. The new guys are getting their power from the Reliance grid and everyone else at Rs 3.80. At this rate we are 50% lower.

HERALD: Look at all policies, tourism policy, industrial policy it is all about going big. Where does that leave the small industry? Do they have space in the pool?

Joshi: When you are saying big it has to be put in context. It is big when compared to the size of Goa

HERALD: I am talking of a generic mind shift change. They say if 2 and 3 star hotels are not working, let’s do 5 stars. Tourism is becoming all about huge 

convention centers.

Sardessai: I think the focus areas of the policy are high value areas. They will co-exist with this eco system where you need the convention centre and the five star hotel. Today If I want to put my guests up in Panjim I have just two hotels. Look at the rates, if we have five or six of them the rates will come down. Panjim needs two or three five star hotels.

HERALD: Do you think the tertiary industry will benefit from this?

Pai kane:  Tertiary industry cannot rely on themselves, they need a large industry, we cannot have one without the other. Goa is not the best place for manufacturing for small industries; if there is a mother unit in Goa it will be easier 

HERALD: What are your satisfaction levels with the industrial scenario and the way forward?

Joshi: I think the overall scenario in the country was dull till a few months earlier. The mood is changing but actual changes are yet to take place. In next six month’s there will be upturn

HERALD: Shekhar why will people come to Goa?

Sardessai: I think any industrialist set up here you will give you the answer. They don’t work on thin margins and need manpower which is well paid. They are happy here since they find the talent here and the overall ecosystem in terms of licence raj compared to other sates, goa is far better in that respect. We need to keep this image growing. Policy envisages we will improve infrastructure, improve the climate and make Goa an aspirational investment destination

HERALD: But industries have also moved out, Goa has lost.

Kunkolienkar: There are factors you cannot blame Goa, Himachal had exemptions, then changes in central excise many job workers used to come and operate in Goa , tv manufacturers, they had benefit under earlier tax regime , excise then changed the rule of valuation , so the benefits of working here was lost. Many companies scaled down their operations and moved high quality operation to other states. It happened then GST VAT came . GST will bring lot of advantages to the state.

HERALD: You are saying the someone who is here will not move out?

Kunkolienkar: No, he will not, his entire ecosystem will be looked after. We want a cluster to come. Rs 25,000 crore is not just top companies but periphery that will develop has to be included in this. Many people were interested but then the sez controversy put them off. In Goa it is easier to approach the administration than in other states. Logistically i think Goa will emerge as a hub we have a connectivity , sea , air, road. All this is available in a radius of ten km. 

Pai kane:  Goa offers a unparallel experience at a marginal extra cost. There are very few places where you can go from home to office and back in thirty minutes.     If we can dovetail this with skill sets , good infra . single window then it will work. We will become a destination where we will refuse more people than grant.

Ghosh: I  am even stevens or lukewarm because the ease of business has not set in we have to see those changes . the sounds from the PM are good but it is not music on the ground. I suppose that will take time. Having said that in Goa , we have the natural advantages which were mentioned , connectivity , enough talent pool , we have never had a problem getting people in goa . 90 percent local. I think power, waste management has to be addressed. If we can overcome that it will be a diff story.

HERALD: Be euphoric but also circumspect.

Ghosh: Yes , hope for the future.