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The Karnataka government is all set to introduce the 'deemed approval' concept to help new projects. The state, which has about Rs 5,39,087 crore projex under various stages of implementation, is likely to roll out the new system in a month or two.
'Deemed approval' means that if a project does not get approval from a government agency within the period stipulated, then it is deemed to be approved. The Department of Industries and Commerce, Karnataka, is presently working with departments such as power, water, pollution and labour, seeking their opinion on what constitutes a reasonable time period for granting approval.
The state government has also introduced a combined application submission system under which a promoter can forward applications seeking clearances from different departments. The Karnataka Udyog Mitra (KUM) will follow up on each proposal with the departments concerned, and monitor the progress of approvals.
By taking these steps, Karnataka will join the neighbouring states of Telangana and Andhra Pradesh, which have introduced similar concepts to woo investors. The move is expected to help the state in not only retaining big ticket investment proposals but also expedite the pace of project execution.
In July 2013, Posco India abandoned its six million tonne finished steel project due to land acquisition issues. The Karnataka Neeravari Nigam’s Rs 5,985 crore Upper Bhadra Lift Irrigation project has been stalled due to non-receipt of necessary clearances.
In September 2014, Hero MotoCorp decided to shift its proposed two-wheelers manufacturing unit with a capacity of 1.5 million numbers per year, from Dharwad to Chittoor district in Andhra Pradesh, due to tax concessions and other sops offered by the state.
Recently, Zuari Global cancelled its one million tpa di-ammonium phosphate (DAP) unit planned at Karwar, in Uttara Kannada district, due to land issues.
To tackle the land acquisition issue, each investment proposal, filed online, will first come before the Land Audit Committee. The committee will assess the land requirement in each case and will take a view on how much land to give. If land is not available in the place an investor is seeking it, then an alternative place will be suggested.
Between April-December 2014, Karnataka saw 362 new projects worth Rs 50,673 crore being announced, as compared to 298 projects worth Rs 19,590 crore announced during April-December 2013.
Major projects announced in 2014 include Sesa Sterlite’s proposed steel unit with a capacity of five million tpa coming up at Kakkabevenhalli, in Bellari district; Asian Paints’ Nanjangud unit with a capacity of five lakh klpd; Hindustan Coca-Cola Beverages’ aerated drinks project coming up Yadgir taluka in Kalaburagi district.
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