Congress cries foul over Modi’s ‘incentives’ for Nano

November 11th, 2008 - 10:23 pm ICT by IANS  

Ahmedabad, Nov 11 (IANS) The Congress has criticised the Gujarat government for reportedly offering a soft loan of Rs.95.70 billion and other special incentives to the Tata group for the prestigious Nano car project in the state.If for an investment of Rs.220 billion by the Tatas, the Gujarat government gives sops worth Rs.300 billion, then Chief Minister Narendra Modi is bartering away the future of the state, Gujarat Congress chief Siddharth Patel told the media here Tuesday.

He was reacting to a news report in a local daily that the Modi administration has refused to confirm or deny.

The report said the government had denied information, sought under the Right to Information Act, on the Nano project.

The report said a soft loan of Rs.95.70 billion had been offered to Tatas with an interest rate of only 0.1 percent.

“This means that there is a debt of Rs.60,000 on the people for every Rs.100,000 Nano car produced,” Patel said.

He said the state’s industrial policy was twisted to favour one project. “Why so many sops for one project? Why not the same sort of incentives for others?” he asked.

Even the cost of relocating the project from Singur in West Bengal to Sanand near here, pegged at Rs.7 billion, is being borne by the state, Patel said.

The state is also bearing the cost of infrastructure development that includes roads and rail, gas pipelines, affluent treatment plant, electricity and water, he said.

If the value-added tax (VAT) trade-offs are calculated on the 250,000 Nano cars to be manufactured annually for a period of 20 years totalling five million cars, it comes to Rs.1.75 billion and if all the sops are taken into account then the figure comes to a whopping Rs.300 billion, he said.

“It is a sell-out. Modi has played the role of a broker,” said Gujarat Congress chief spokesperson Arjun Modhwadia.

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