IFSC in struggle for ‘SEZ’ tag

The state government’s ambitious plans to construct the International Financial Services Centre (IFSC) at Bandra-Kurla Complex (BKC) has hit another hurdle, as the ministry of commerce hasn’t yet notified it as a special economic zone (SEZ). The state government had cleared one hurdle by refusing to give away the plot meant for the IFSC to the Railways for the Mumbai-Ahmedabad bullet train terminal, but chief minister Devendra Fadnavis’s pet project has still not taken off.

It has been more than a year since the state government urged the Centre’s ministry of commerce to get the 20-hectare plot in BKC notified as an SEZ for the IFSC. The Centre is yet to give an approval for the same, without which the state cannot even start basic work like designing a layout for the IFSC.

According to the norms, SEZ-notified zone should at least measure around 50 hectares, however, in the case of BKC, it is only 20 hectares. The state had urged the Centre to relax norms, citing a land crunch, and the same would be compensated in terms of vertical development, that is by giving additional Floor Space Index (FSI) for construction.

BJP MP Poonam Mahajan, chairman, IFSC committee, said, “We are very much on track and the SEZ notification by the ministry of commerce is also expected to come soon. The master layout and the SEZ notification have nothing to do with each other.”

It is only after the plot gets the SEZ tag that benefits and incentives that include duty-free import domestic procurement of goods for development are made available. Investors are likely to find BKC an attractive area for their bases. The Mumbai Metropolitan Region Development Authority (MMRDA), the implementing agency of the project, is set to appoint a consultant who will design the layout of the project. However, an official involved in the project, said, “For a consultant to prepare a layout, he has to be given details related to the measurement of the plot and, without having any clarity from the Centre on declaring the plot as an SEZ, the consultant cannot start work.”

The construction of the IFSC is already mired in controversy as Railways had been forced to tweak designs for the Mumbai-Ahmedabad bullet train after the state government was adamant about the BKC plot being used for the IFSC.

Mr Fadnavis on Friday said, “We have asked for a clarification from the Centre as to whether or not the Centre can reduce the land required for financial SEZs. The central government has broadly agreed.”

In May 2015, Mr Fadnavis had revived the proposal for the IFSC, which had been on paper for close to six years. A proposal for the construction of the same was approved by the MMRDA in August 2015. The centre would encourage international companies to set up their hubs in the commercial area of BKC.

Railways controversy Following the announcement by Railway Board that a Mumbai-Ahmedabad bullet train terminal would be constructed at Bandra-Kurla Complex (BKC), the chief minister’s office hurriedly ordered the Mumbai Metropolitan Region Development Authority to float tenders for appointing design consultants for the construction of the IFSC on the 20 hectares of land that was reserved at BKC, while refusing to share land with Railways for the bullet train terminal.

Maha pitted against Guj Highly placed said that the Centre is yet to take a decision on declaring the plot for the International Financial Services Centre (IFSC) at Bandra-Kurla Complex (BKC) as special economic zone because the Maharashtra government is competing with Prime Minister Narendra Modi’s dream project, the Gujarat International Finance Tec-City (GIFT), in Ahmedabad.