WBIDC creates Rs.300 cr VC fund

West Bengal Industrial Development Corporation has created a Rs.300 crore venture capital fund to promote IT and BPO firms in the region. The fund is now seeking participation from private sector companies and is also contemplating a tie-up with financial institutions, state minister for IT and environment Shri Manabendra Mukherjee said. WBIDC and West Bengal Electronic Development Corporation (WEBEL) already have a venture fund exclusively in eastern India to encourage entrepreneurship in the small sector.


MIDC maps marketing plan

The Maharashtra Industrial Development Corporation (MIDC) has drawn up plans to market its specialised parks to attract emerging sectors. MIDC is promoting a Floriculture Park at Talegaon near Pune, spread over 200 hectare of area. Plots will be allotted to individuals willing to start their own floriculture units. The corporation would be providing common facilities like post harvest service and logistics, apart from professionally run plant propagation nurseries through service providers for production of quality planting material at economical rates.


Rajasthan's New Investment Policy 2003

The Rajasthan State Government had announced three industrial policies in the 90s; in 1990; 1994 and 1998. The major incentive available under the first two policies was Capital Investment Subsidy whereas under the 1998 policy it was Interest Subsidy upto 2%. Besides that Sales Tax Exemption and Deferment schemes were also available from time to time.

The highlights of the current policy are given below:

  • 100 percent exemption of Luxury-tax on new investments;
  • Exemption of 50 percent on Stamp-duty and Conversion-charges in case of all investments;
  • Exemption of 50 percent on Electricity-duty, Mandi-tax and Entertainment-tax for 7 years in case of all investments;
  • Interest subsidy of 5 percent would be made available. And additional interest subsidy of 1 percent to SC/ST (Schedule Castes/ Scheduled Tribes) entrepreneurs for 7 years. This interest subsidy would be available to the units having a minimum borrowing of Rs.50 lakh or having an investment of atleast Rs.25 lakh in land and buildings. For purpose of calculating investment in land and buildings, the calculation for land would be made at DLC rate and for building at the rate of Rs.300 per square meter.
  • Wage/employment subsidy of 25 percent of wages/salary with respect to such workers who are contributing towards PF and 30 percent on appraisal by Rajasthan State Industrial Development and Investment Corporation (RIICO)/Rajasthan Financial Corporation (RFC) when the inventor is not availing interest subsidy. Wages/employment subsidy would be available for 7 years.
  • The sum total of interest and wage/employment subsidy would be subject to a maximum of 50 percent of sales tax, purchase tax, VAT and works contract tax.
  • Wage/employment subsidy would be available only if the unit provides direct employment to atleast ten persons in case of new units.
  • Interest and employment subsidy would be available to new as well as existing units for modernisation and expansion to the extent of additional employment generated or capital borrowed and additional taxes paid.
  • The payment of interest and wage subsidy would be made through a mechanism which would be worked out within a period of one month.
  • Interest @ 5 percent annum would be payable to investor in case the reimbursement is delayed for a period of more than 30 days.
  • Guarantee Commission would be reduced to 0.5 percent in case of RIICO and RFC so as to reduce their lending rates.
  • A budgetary provision of Rs.100 crore would be provided every year till 2007 for development of critical infrastructure for new investment.
  • For the purpose of this policy, “New Investment” shall mean investment in a project involving loan of atleast Rs.50 lakh or investment in land and building of atleast Rs.25 lakh.

RIICO releases Citizens' Charter

RIICO released its Citizens’ Charter recently. On the occasion, Dr. Chandrabhan, the Industries Minister said that the State Government had made a commitment to the entrepreneurs, industrialists and the people at large that it will provide a responsive, accountable and a transparent Government. This had been kept in mind when RIICO charted its Citizens’ Charter. The objective of this Charter is to provide information to entrepreneurs, investors and other citizens. Now they will have a right to information about RIICO’s activities and schemes.

In the charter, time limit had been set for allotment of land and disposal of pending issues. The concerned Sr. Regional Manager/Regional Manager/Assistant Manager will now allot land within 15 days; execute the lease deed within 3 days, make amendment in the partnership and articles of association within 7 days and provide extension of time limit for construction and production within a period of 7 days. Similarly, for sanction of financial assistance, the lease deed to be provided to financial institutions for loan will be done within 3 days and the loan will be sanctioned within 60 days of receipt of complete application. Similarly, time limit has also been set for equipment refinance scheme, working capital, flexi-loan and multi-purpose loan. After the receipt of 0.1% processing charge, the loan will be cleared as early as possible. As far as one time settlement is concerned, the process will be completed within 45 days.

Those having a complaint regarding allotment of land have been advised to contact the concerned unit heads and Advisor Infrastructure at the Head Office in RIICO. Similarly any complaint regarding development works in any of the RIICO’s industrial areas; may be made to Chief General Manager (Projects) in the head office. He said that for any kind of complaint, the entrepreneurs and investors can also contact the senior officers of RIICO or him personally.
Rent-free built up space for IT and ITES Companies

In an attempt to give a fillip to IT/ITES project RIICO will now provide rent-free built up space in the Software building of the Sitapura-based IT Park in Jaipur.
Any I.T. (Information Technology)/I.T.E.S. (Information Technology Enabled Services) project wanting a plug and play facility in the software building will be exempted from payment of basic rent of Rs.5.65 per sq. ft per month. This exemption, however, will be for only the first year and they will have to pay monthly common service charges @ Rs.2.90 per sq. ft.

RIICO has constructed a software building in I.T. Park where built up space on rent as well as on outright sale is available. In the first phase 20,000 sq. ft. built up space has been constructed. The modules are available in multiple of 1000 sq. ft. Facilities like continuous power, water, high-speed data communication link through the Satellite Earth Station among others are available in the building. The I.T. Park in which the Software building is located has been developed in the I.T. Park developed on an expanse of about 100 acres in the Export Promotion Industrial Park (EPIP) near Jaipur. Developed plots are available in the multiple of 1000 sq. mt. RIICO is providing a rebate ranging from 25 percent to 60 percent on land to I.T. industries in the area.

A high speed data communication facility is being provided to I.T. units in periphery of about 30 kms. in Jaipur through an Earth Station. Set up by RIICO in association with STPI, the Earth Station is providing both point to point and internet connectivity to I.T. units.

Keeping in mind the requirement of trained and skilled manpower; RIICO has promoted advanced computing institutes; Compucom Software, Cistem Software, Global Institute of Technology and B.R. Mirdha Institute of Technology and Science. Apart from uninterrupted quality power, the park has a good network of roads and other infrastructure.

Some of the well-known units like G.E. Capital International Services, Compucom Software, Cistems Software, Global Institute of Technology, Software Technology Park of India, AM Plus are already operational in the Park.

RIICO launches new scheme for Medium Term Loan

RIICO has launched a new scheme for medium term loan against securitisation of fixed assets. Under this scheme, those companies which are in production for the last 5 years and have earned cash profit for the last 3 years will be eligible for financial assistance. They must also have a satisfactory repayment record with financial institutions/banks and should have repaid atleast 75% of the principal amount of term loan.

The loan amount will be limited to 30% of fixed assets value subject to maximum of Rs.2 crores. The repayment of the loan shall be made within a period of 6 years with a moratorium period of not more than 1 year. RIICO has launched this scheme to meet the fund requirement of the entrepreneurs for setting up expansion of projects. This loan can also be used for clearing debt, working capital term loan and corporate loan. The builders setting up commercial, residential complexes can also avail of this assistance, as can entreprenurs for hotel for tourism-related projects. This scheme will also be useful for financially sound companies wanting to raise funds to invest in their associate concerns.

RIICO has also decided to charge only 1% premium on the balance in case an entrepreneur returns the loan before time to the Corporation. A number of important decisions relating to infrastructure development have also been taken. RIICO has agreed to the proposal made by the Neemrana Industries Association for taking care of infrastructure related facilities like water, fire fighting arrangements and general maintenance of the industrial areas. The service charges received from the allottees in these areas will be given to the Industries Association. Similarly, if any other industries association wants to take up the responsibility of maintenance of its industrial areas : they too will be given the permission. The Board of Directors also took a decision to set apart 3000 sq. mt. chunk of land free of cost to the Vishwakarma Industries Association for making a Recreation Club.

The premium charged on the transfer of commercial plots has been reduced to half and the yearly service charges taken from the allottees of such plots have been reduced from 4 times to 2 times of industrial rate. RIICO will now charge only Rs.7.5% of the prevailing industrial rate instead of 10% on the transfer of residential plots. There has also been a reduction in the retention charges for commercial plots in which there has been a delay in the commencement facilities. The development charges in the industrial areas of Khushkhera and Chopanki have been reduced to the level of rates prevailing on 1st April, 2002.

RIICO's profit of Rs.3.42 crores in 2002-2003

RIICO has posted a net profit of Rs.3.42 crores in the financial year 2002-2003.

During above mentioned period, RIICO earned an income of Rs.151.37 crores and spent an amount of Rs.147.85 crores under different heads. RIICO sanctioned financial assistance to Rs.63.63 crores and disbursed an amount of Rs.45.89 crores. It made a record recovery of Rs.130 crores in the year.
During the last financial year RIICO spent Rs.31.05 crores for the development of its industrial areas and Rs.11.14 crores towards its maintenance. RIICO also took an important step of returning loans which it had received on higher rate of interest thereby making a saving of Rs.20 crores in the form of interest that would have been paid.

RIICO in association with SIDBI has formulated Rajasthan Venture Capital Fund for financing of IT, Biotech and other knowledge based industries. The Fund has been made operational in November, 2002.

During the year under review, the Corporation introduced a new scheme for providing loans to Builders/Commercial/Residential Complexes taking up development of real estate projects.

New loan scheme in Rajasthan

RIICO has launched a scheme for industrial units to avail of medium term loan against securitisation of fixed assets. Five year old units making profit in the last theee years will be eligible for financial assistance under the scheme.

The RIICO board at its recent meeting also cleared four projects worth Rs.13.82 crore and sanctioned a term loan of Rs.8.16 crore to these projects. According to RIICO officials, the scheme is aimed at helping entrepreneurs to meet their funds requirements for expansion. The loan can also be used for clearing debt and meeting working capital requirements.

The units must have a satisfactory repayment record with financial institutions and banks and should have returned atleast 75 percent of the principal amount of the term loan sourced earlier, said an official.


HSIDC retains 'MA' rating for Public Deposit Scheme

ICRA has reaffirmed the ‘MA’ rating, signifying adequate safety, to the Public Deposit Scheme of Haryana State Industrial Development Corporation for the current year as well. This rating has been retained by the Corporation continuously for the last ten years which reflects the financial health of the Corporation as well as the investing public’s faith in its public deposit scheme.

ICRA has reaffirmed the rating after carrying out annual surveillance and due consideration of the latest developments and performance of the Corporation. This rating takes into account Capital Adequacy, Asset Quality, Recoveries, Management, Earnings, Financial Flexibility and Liquidity position of the Corporation. HSIDC is a State level industrial development corporation, wholly owned by the Government of Haryana. HSIDC provides financial assistance by way of term lending and equity investment in the projects being set up in the State of Haryana. The State Government has also declared HSIDC as the sole nodal agency for development of industrial infrastructure in the state of Haryana. HSIDC has achieved ISO 9001:2000 certification for its financial and related services being provided to industries in Haryana. It has earned the distinction of being the first state level financial institution in the country when it received ISO 9002:1994 certificate from Bureau of Indian Standards (BIS) in 1997. The upgradation was necessitated because of the higher standards and bench marks fixed by the ISO over the years. The
upgraded certificate has been awarded to HSIDC after thorough investigation from the auditors and the requisite qualification possessed by the corporation for obtaining the new version of ISO 9000 quality management systems standard. International certification limited - a certification body based at Auckland in New Zealand is having its group companies in Mesa Arizona (USA), Abu Dhabi (UAE), Brisbane (Australia), Seoul (South Korea), Toronto (Canada), Bangkok (Thailand), Delhi and Chandigarh in India. The group provides independent third party certification service for environment, quality and occupational health and safety management system to national and international standards, including the ISO 9000 series of standards, ISO 9001:2000, ISO 14001:1996, QS-9000 and global HACCP, laboratory registration conforming to ISO guide 25.

HSIDC calls for settlement of loans

HSIDC has invited the borrowers covered under revised Reserve Bank of India (RBI) guidelines to settle their accounts through one-time settlement scheme.
An HSIDC spokesman said on September 16, 2003, the companies whose accounts with outstanding upto Rs.10 crore are classified as sub-standard, doubtful and loss as on March 31, 2000, would be covered under these guidelines.

Similarly, the companies whose cases were pending before courts, subject to consent decree being obtained without prejudice to the rights of the corporation would also be covered. The cases where no one-time settlement had been approved earlier and had not been categorises as wilful defaulters would also be covered. The minimum one-time settlement amount payable would be worked out as per the RBI norms.

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