KIA Motors which is the part of Hyundai has announced its decision of shifting its manufacturing plant from Tamilnadu to Andhra Pradesh. The news comes at the time when few of the ministers houses were raided by the IT officials.
Kannan Ramasamy, Managing Director of Infratech Infrastructure Services of Chennai has alleged on his facebook post that some politicians demanded a very huge bribe to allow KIA to enter the state. He said that the lands were offered at 50% more than the usual rates.
The company which is entering late in the crowded Indian automobile market has planned to take on the entry level segments since the availability of brands and models are really less making it a lucrative segment. It announced an investment of USD1.1 Billion which would have also generated few thousands of jobs. However a state official denied the allegations saying “TN was willing to offer only those concessions that it could under its industrial policy”.
“As part of their local consultants, our team made a detailed study and recommended Tamil Nadu as first choice, Gujarat as the second choice and Sri City (AP) as third choice. They approached TN industries secretary and SIPCOT, and SIPCOT has enough lands to give at Oragadam complex.”, he said.
Tamilnadu was the first choice by default because of the presence of its parent company Hyundai in Sripreumbudur with Gujarat coming in next and Sri City from Andhra Pradesh as third preference. Kia Motors demanded tax holiday, power tariff concessions and infrastructure such as roads, water, drainage, fast-track approvals, etc. for setting up the factory in SIPCOT which is the industrial hot spot near Chennai.