A lot was expected from Global Investors Meet- 2010: An investment of Rs 13.92 lakh crore that would go into creating eight lakh jobs in the state. But the years since have proved that the government had set its sights a little too high as the state has so far received only Rs 15,369.9 crore in investment and created 23,359 jobs. Of the 389 MoUs signed, only 37 have translated into actual projects and even these involve smaller local companies like Swastik Steel, Hospet, Nirani Sugars, Kisan Mouldings and Kej Minerals. None of the bigger promises have made it past past the paperwork yet.
The Rs 1,36,000 crore steel plant planned by Bramhani Industries Karnataka Ltd (now known as Uttam Galva Ferrous Ltd), is hobbling along for want of land. When steel giant, ArcelorMittal announced it’s plans to invest Rs 1,30,000 crore in a steel plant in Bellary, Karnataka seemed to have netted the biggest catch of all, but problems in land acquisition and now the global slowdown in the steel industry have dogged the project which is not expected to materialise anytime soon. As of now the company has made some headway in acquiring about 1,800 acres for the proposed six million tonne plant, but still needs more.
Another steel major, Posco was expected to set up a Rs 1,32,336-crore plant in Gadag, but the farmers’ refusal to part with their land, has now forced the government to look for a new location. In a nutshell, Karnataka been able to realise only about 9.5 per cent of the proposed investments thanks mainly to land-related problems. While the state readily promised to provide land through the Karnataka Industrial Areas Development Board (KIADB) to investors, the board didn’t have any at its disposal and so could not establish the new industrial areas needed.
Of the 277 projects pending, 159 are meant to come up in KIADB industrial areas and 47 on land acquired under the Karnataka Land Reforms Act. The biggest lesson the state government can learn from GIM 2010 is to consciously focus this time on small-ticket projects, especially medium and small industries, as they can result in more employment. The investment per project may be smaller, but its impact could be greater on the economy.