July Launch for India's $100 Billion Industrial Corridor

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Researched by Industrial Info Resources (Sugar Land, Texas)--The government of India is in the process of appointing a team of consultants from among 17 consulting agencies that have submitted expressions of interest for participation in the ambitious $100 billion Delhi-Mumbai Industrial Corridor (DMIC) project. Sixteen agencies have been shortlisted and the government is likely to announce its final decision this month. The team of consultants appointed will commence work on the project by July. This initiative is expected to see completion within a period of 10 years from commencement.

The DMIC is a trade and business development initiative spread over 436,486 square kilometers across Delhi, the states of Gujarat, Haryana, Madhya Pradesh, Maharashtra, Rajasthan, and Uttar Pradesh, and the union territories of Dadra and Nagar Haveli and Daman and Diu. It is being built with the upcoming 1,483-kilometer dedicated freight rail corridor between Delhi and Mumbai that will offer high-speed connectivity to high axle-load wagons. Under the DMIC project, airports, industrial and manufacturing hubs, ports and special economic zones will be developed in a 300-km zone along the route of the $5.5 billion rail project.

Phase I of the DMIC project will commence in 2008-09 and will be completed by 2012, which will coincide with the completion of the railway. During this period, six industrial zones of about 100 square kilometers each and six investment regions of nearly 200 square kilometers will be developed along the corridor to form self-sustaining industrial townships with excellent infrastructure facilities including industrial clusters, and air, road and rail connectivity for freight movement to and from logistic hubs and ports. Phase II of the project will last from 2012 to 2016.

In January of this year, the government established the DMIC Development Corporation as a nodal agency for the execution of the project. The government holds a 49% stake in the agency, while the remainder is held by financial institutions such as Infrastructure Leasing & Financial Services Limited (Mumbai), Infrastructure Development Finance Company (Chennai, Tamil Nadu), and India Infrastructure Finance Company (New Delhi), as well as the governments of the six states through which the proposed corridor will run. Also in January, the Indian government indicated that the DMIC project could be extended by an additional 200 km to Ludhiana to include the state of Punjab in the project. In May, the government sanctioned a sum of $250,000 for setting up an autonomous committee and a nodal agency in the state to facilitate development initiatives under the DMIC project. A total amount of $10 billion has been earmarked for the industrial development of the state under this initiative.

Japan has committed to an investment of $10 billion over the next five years toward the DMIC project. Japan hopes to promote investments by small and medium Japanese companies and will also set up a task force to mobilize and implement investments for the project. India is also seeking investments from the United Arab Emirates. Infrastructure work will be executed mainly in the public-private partnership mode.

The DMIC project has a direct influence on an area that is home to 178 million people, or nearly 17% of India's total population. The development of this global manufacturing and trading hub is expected to generate more than 3 million employment opportunities, mainly in the manufacturing and processing sectors. The project will catalyze industrial growth in these regions and will see industrial output tripled and exports quadrupled within a period of five years.

Industrial Info Resources (IIR) is a marketing information service specializing in industrial process, energy and financial related markets with products and services ranging from industry news, analytics, forecasting, plant and project databases, as well as multimedia services.