Tata Motors to get Rs 95 bn from Guj government

AHMEDABAD: Auto major Tata Motors, which is developing small car Nano project in Gujarat's Sanand, will get benefits worth Rs 95 billion from the state government for developing infrastructure around the project area, sources said.

Tata Motors will get 20 years from the commencement of the project to repay the amount at an interest rate of 0.1 percent. The amount will be repaid by adjusting value added tax dues of the company, the sources said.

The company would use the fund to build a township and a 'transport nagar' near the plant location in Charodi village near Sanand to meet the logistics support needed by the project.

Local government officials refused to comment on the deal between the government and the auto maker.

However, Arjun Mothwadia, former leader of the opposition in the state assembly, said the deal had been approved by both sides though it was yet to be announced.

Though the Congress party, to which Mothwadia belongs, made several efforts to get the details of the arrangement through the Right to Information provisions, it did not succeed, he added.

The government had also pledged to provide 100 acres for Tata for developing the proposed township.

However, Tata Motors officials said the total amount was an aggregate of "various concessions", including the 100 acres, stamp duty exemptions and concessional power tariff.

Tata Motors last month shifted out its Nano plant from Singur in West Bengal to Sanand following protests by the opposition Trinamool Congress-led farmers against the project.