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Karnataka's Krishna all set to allure global, domestic investors

George Iype in Bangalore

Karnataka Chief Minister S M Krishna is on a hard-sell drive. He has lined up a massive advertisement blitz in top international newspapers promoting Karnataka as the best investment destination in India and Bangalore as one of the top ten technology cities of the world. Also on cards are road shows in major Indian cities to lure domestic companies to set up shop in Karnataka.

Krishna seeks to strike a rich vein in the private investment gold-mine when he kick-starts showcasing the state as the best investment destination at the Global Investors' Meet in June.

As a precursor to the meet -- to be attended by the who's who of the Indian industry and nearly 400 delegates from 20 countries -- the Krishna government has lined up 17 crucial projects in power, water supply, minor airports, tourism, food processing, etc. for private investment.

Karnataka offers investment opportunities in information technology, electronics, telecommunications, bio-technology, apparel exports, automobile, pharmaceuticals, industrial parks, expressways and seaports.

The month-long mega show, on which the government is spending close to Rs 150 million, will be the biggest business meet that a state government has ever organised. In the bargain, the Krishna government hopes to rope in investments of more than Rs 50 billion by the end of June itself.

The event is being managed the Karnataka State Industrial Investment and Development Corporation in consultation with Arthur Andersen, KPMG, and the Confederation of Indian Industry, or CII. While Arthur Andersen and KPMG are carrying out the international promotions of the meet, the CII is helping the government to conduct the domestic road shows.

"We are ready to roll out the red carpet for multi-national and domestic companies who have shown immense interest in investing in various projects in the state," Karnataka Heavy and Large Industries Minister R V Deshpande told rediff.com.

"The Global Investors' Meet is the first mega-show that a state government has organised. We will showcase Karnataka as a market-friendly state and the most preferred destination for Indian and international investments," he said.

Karnataka is not the first state to host an international investors' meet. Maharashtra conducted a similar event four years ago and bagged several multi-million dollar projects. Karnataka has been planning such a meet for the last five years, but political turbulence acted as a major hurdle delaying the meet.

Deshpande, however, said that the variance between the Karnataka meet and the one hosted by Maharashtra will be the difference between "lightening bug and lightning".

"The meet starts on June 5 and will continue till June-end. We will give clearances to most of the foreign investment projects in June itself," the minister said.

He, however, added that some of the infrastructure projects would have to wait for a month or two as they may require environmental clearances from the central government.

About 200 prospective investors from 20 countries, including the United States, the United Kingdom, Canada, Australia, Japan, Singapore and Malaysia, have electronically registered their willingness to participate in the meet.

Some of the overseas companies have already submitted proposals in the fields of power, water supply, road development and mini airports.

Officials sources said that the United States-based El Dorado group, a world leader in hospitality industry, has submitted Rs 35-billion project proposals for setting up joint ventures in the hotel and hospitality sectors.

Buoyed by the encouraging response, Chief Minister Krishna has constituted a cabinet sub-committee that will clear all foreign and domestic investments on a priority basis.

Officials said that more than a dozen thrust areas are being projected for the meet. They said that the state cabinet is actively considering a proposal that the Karnataka State Industrial Investment and Development Corporation pick up selective, minority equity stakes in several joint venture projects.

Officials preparing for the meet said that one of the major projects that the state will push during the mega event is the 220-km Hubli-Bellary state express highway.

The Hubli-Bellary project is already underway with an investment of Rs 3.55 billion. The state government, however, now feels that the project be thrown open to private investors as a toll road on a build-and-operate basis.

The state government has also finalised a mini-airports plan as per which global tenders will be put up for setting up minor airports at Bellary, Mysore, Hubli and Gulbarga.

Besides, water recycling and rehabilitation schemes for Bangalore city, a gem and jewellery park at Karwar and a floripark near Bangalore, a 500 mega watt thermal power plant at Vijayanagar are some of the other projects on offer for private investors.

To promote tourism, the state government's action plan includes commissioning of six tourism projects worth Rs 2.60 billion at Kodagu, Bhadra and Mysore to private investors.

According to a recent study by the Bangalore-based Public Affairs Centre, nearly 1,200 large and medium scale industrial proposals involving a staggering investment of Rs 680 billion had come to the state on paper. But only 11.5 per cent of them actually materialised in the last four years.

Since these figures belie the projected picture that Karnataka is the most favoured industrial investment destination in the country, the Krishna government hopes that the Global Investors' Meet will help boost the state's image for private projects.

Business

Karnataka