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Delhi-Mumbai Industrial Corridor: a Global Manufacturing and Trading Hub

Sameer Pushp**


Delhi-Mumbai Industrial Corridor (DMIC) is a major step by the Government to boost the potential of Indian economy by improving the infrastructure sector. Today, India aims at sustained GDP of 9-10 per cent which necessitates the growth of the manufacturing sector to be at least 13-14 per cent per annum consistently. To achieve this, the Government has planned to promote integrated development of industry and infrastructure in a band of 150-200 km on either side of the Dedicated Railway Fright Corridor (DFC) between Delhi and Mumbai. The Delhi Mumbai Industrial Corridor is conceived to be developed as a Global Manufacturing and Trading Hub with emphasis on expanding manufacturing and service hub.  DMIC is a State-Sponsored Industrial Development Project aimed at developing an Industrial Zone and eco- cities spanning across six states in India.  DMIC project will see major expansion of Infrastructure and Industry – including industrial clusters and rail, road, port, air connectivity – in the states along the route of the corridor, covering an overall length of 1500 km. 


DMIC project is expected to double employment potential, triple industrial output and quadruple exports from the region in five years. The total employment to be generated from the project is 3 million and the bulk of which will be in the manufacturing/processing sectors. The project will be funded through private-public partnership and foreign investment. Japan is a major investor for this project. It will include a 4000 MW Power Plant, three sea Ports and six Airports in addition to connectivity with the existing ports. The industrial corridor project will be implemented by the Delhi Mumbai Industrial Corridor Development Corporation, an autonomous body comprising of Government and Private Sector.


The ambitious Rs.3,60,000 crore DMIC project crossed an important  milestone recently with the signing of two agreements between India and Japan. The agreement was signed in the presence of Shri Anand Sharma, Minister of Commerce & Industry. There is a proposal to develop Eco-cities (Smart Communities) in and around the dedicated corridor.  The smart cities will be built on the principles of environmental and ecological sustainability. The new eco-friendly townships and industrial zones in the DMIC region will adopt global best practices in sustainable development of future cities, not only in India but in the entire world.


Following an integrated approach to development, DFMIC envisaged the establishment of 24 high impact/ market driven nodes- Integrated Investment Regions (IRs) and Industrial Areas (IAs), spanning across six states within the corridors to provide transparent and investment friendly facility regimes. These regions are proposed to self- sustained industrial townships with world class infrastructure. It is proposed that 6 IRs and 6 IAs would be taken up for implementation in the first phase.


The Government of Japan has already sanctioned long term financial assistance for funding the western DFC. Extending the spirit of partnership and economic cooperation between India and Japan, the following joint initiative are being taken for implementing the project :


·    Collaboration in the Development of Eco- Cities (Smart Communities) at various places at DMIC region.

·    Setting up of a Project Development Fund (PDF) to undertake project development activities like master planning and feasibility studies, preparation of detailed project reports, obtaining necessary approvals and bid process management for projects to be taken up in DMIC region.


            The DMIC Project Development Fund is envisaged to be set up with equal contribution from the Government of India and Government of Japan. The Government has already approved grant of Rs.330 crore in the XI Five Year plan as the Indian Contribution. The Japanese component of US $ 75 million is being provided in the form of united loan from Japan Bank of International Cooperation (JBIC) and the Government of India is extending a guarantee to JBIC for this loan.


The project region of DMIC covers parts of Uttar Pradesh, Haryana, Rajasthan, Gujarat, Maharashtra and Madhya Pradesh. Delhi Mumbai Industrial Corridor Development Corporation (DMICDC) will have a revolving Project Development Fund for financing project specific SPVs to undertake activities like initial approvals etc. before they are bid out to private sector.  The initial size of DMIC-Project Development Fund will be Rs.1000 crore (US $ 250 million).  The Government of Japan is willing to contribute US $125 million (Rs.500 crore) for DMIC-PDF, as untied loan of Japan Bank for International Cooperation (JBIC) while Rs.330 crore has been approved for the project under the 11th Five Year Plan.


The DMICDC has signed MoU with the State Government of Gujarat on 25th July 2008 and with Madhya Pradesh on 26th August 2008 for preparation of perspective and development plan for each node jointly.  It is also proposed to initiate work on readily available but strategically important three to four early bird infrastructure projects identified by the States. The Government of Madhya Pradesh identifying the following early bird projects for initiating action immediately: Development of economic corridor along link road connecting Indore Airport to Pithampur along with the development of integrated multimodal logistic hub near Maksi.

The DMIC seeks to create strong economic base with globally competitive environment and state-of-the-art infrastructure to activate local commerce, enhance foreign investments and attain sustainable development.  DMIC is also a glowing symbol of Indo-Japanese collaboration. While India will get truly world-class infrastructure and experience rapid economic growth, Japanese investor will have unlimited opportunity for expanding their business base. It is well understood fact that commercial leveraging of a vibrant regional economic centre in an underutilized and under-invested area can usher a new era of economic prosperity leading to industrial development, employment generation, preserving the environment as well as boosting the services sector in India. (PIB Features)


*Freelance Writer


Disclaimer :  The views expressed by the author in this feature are entirely his own and do not necessarily reflect the views of PIB






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