Sunday, December 31, 2006

What SEZs could be...

Found this interview of Marc Faber (of Gloom, Boom and Doom fame) in ET a couple of days back. I liked his answer to a question on Indian real estate developers.

We have (in Malaysia and Thailand) industrial land development companies. They buy big chunks of land, put in water and electricity and build factories. If you are Sony and you want to produce out of Thailand, you could buy land. But it is a nightmare till you put in water and electricity . You go to these industrial land development companies . They will rent or sell you a factory and provide the whole infrastructure for a management fee. That is a good business model.

Today in India everybody is rushing to put up IT parks, Technology parks but really there arent too many people doing this work. These were done earlier by governments by setting up industrial estates (One which I visited in Butibori - Nagpur was particularly impressive - its better than E-city Bangalore too). Nowadays there is very little policy attention towards creation of industrial infrastructure. But one town I have seen recently comes to mind - Sriperumbudur, TN - which seems to be doing all the right things.

If the SEZs that are being set up can make it easier for manufacturing companies to set up factories here, it will give that boost to the manufacturing industry that is so desperately needed here, Singur notwithstanding.

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