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Mangalore SEZ faces delay on land acquisition

Mangalore Special Economic Zone Limited (MSEZL) is facing opposition from the landholders who are resisting acquisition of their lands. MSEZ Ltd, a joint venture between the Oil and Natural Gas Corporation (ONGC), India’s largest oil producer, and the Karnataka Industrial Areas Development Board (KIADB) and infrastructure financing firm, Infrastructure Leasing & Financial Services, which has already seen a delay of over one year, is likely to be further delayed due to non-availability of the land required for the expansion. As a statutory requirement, any multi-product SEZ needs to have at least 2,500 acres. Presently, MSEZL has acquired 1,800 acres in the first phase for around Rs 700 crore. It has now notified another 2,000 acres in the villages of Permude, Kuthethoor, Tenka Ekkaru and Delanthabetta near Mangalore. The main argument of the landholders is that the compensation amount announced by the company is far below the market prices. Hardly 11 per cent of the land notified is agriculture land. I S N Prasad, managing director, MSEZ Ltd said, the company has got a written consent from farmers for about 800 acres and the joint measurement survey is being conducted for that land. Another 300 acres is with the state government and “there will be no problem in acquiring this land,” he said. “Some of the landholders are ready to sell their land, while many others are asking for a higher compensation. We have paid a compensation of Rs 8.5-9 lakh per acre in the first phase. Now, farmers are asking for Rs 14-15 lakh. We are considering the proposal to increase compensation. But, cannot double the compensation money,” he told Business Standard. Going by the present pace of land acquisition, the conversion of MSEZL into a multi-product SEZ will be delayed further. “We would have completed the process of developing this into a multi-product SEZ much earlier, but for the delay in land acquisition. The declaration of the SEZ as a multi-product SEZ is still far away as we are yet to even apply for the official status. We can do it only when we get 2,500 acres of land,” Prasad said. Till today, MSEZL has spent close to Rs 700 crore, about 45 per cent of the cost of the project. In the first phase land has been allotted to companies like Mangalore Refinery and Petrochemicals Limited for their refinery expansion, OMPL (ONGC Mangalore Petrochemicals Ltd) and Indian Strategic Petroleum Reserve Ltd (ISPRL) for development of petrochemical industries. MRPL has taken around 250 acres at the SEZ to expand their refinery for an investment of Rs 12,000 crore, OMPL has got 450 acres to set up an aromatics complex at Rs 6,800 crore investment.

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