Dubai: One day. Yes! All it takes is one day to get your license and get all other formalities over with at Jebel Ali Free Zone (Jafza), according to Rizwan Sajan, founder and chairman of Danube Group. He’s talking about the ease with which one can establish themselves in Jafza and one of the reasons that sealed his company’s future there.We at Gulf News head out to speak to some investors and ask them why they are in Jafza.
Another, of course, is 100 per cent ownership. “In 2003, [the] Danube business was growing in the UAE. We needed a bigger space and thought freezone was the right place to be. Having a space in freezone meant 100 per cent ownership and that is why we first thought of leasing a space in Jafza,” he tells Gulf News.“At first, I only wanted 100,000 square feet space when he wanted to take up a space in Jafza, he was only looking for an area of 100,000 square feet.
Of late, the free zone has been under fire from malicious quarters, but what the maligners have not considered is the loyalty and goodwill earned by an easy trading partner.
Sajan’s firm, for instance, grew almost five fold thanks to his venture into the area and a serendipitous connect.
“At first, I only wanted 100,000 square feet [of] space,” he recalls. “I approached Sultan Bin Sulayem and told him of my requirement. He said he [had] a place in mind but will get back to me,” he says.
Three months later, he got a call and went over to review a site. “He [Bin Sulayem] showed me a sprawling 350,000-square-foot space fronting the main road. He simply asked me to take it.”
Pleasantly stumped, Sajan said following his conversation with Jafza officials, he returned to his office and discussed the proposal with a friend. “I only needed 100,000 square feet of space but here there was a piece of land three times larger. What was I going to do with that space?” he wondered.
But the leasing rate was very economical. It cost just Dh1 per square foot. The starting cost for license and operations, he added, was Dh22,000 back in 2003.
Besides, a friend had an offer ready – “My friend said he would sub-lease the space if I did not require it. So next day I signed on the dotted line. The deal was concluded,” he explains.
Seventeen years later, Danube owns five million square feet. Jafza has proved somewhat of a good-luck charm. In 2003, the company’s turnover was $50 million, today the group enjoys a turnover of $1.3 billion. “Our revenues have spiked thanks to the great infrastructure and logistics available at Jafza. Whether it is proximity to the world famous Jebel Ali port, the smooth and quick dispatch of goods being imported [and] exported, Jafza has the best systems in place,” explains Sajan.
Peter Haywood MRICS, Manager – Industrial & Logistics Agency MENA for JLL, explains the lure. “There are the tax incentives that are attractive like any other free zone but the main advantages are the skill and expertise of the free zone in assisting with all current and future clients.
To add to the ease of doing business, many projects have been undertaken. “The building of the second bonded bridge connecting Jafza North and Jafza South has helped decrease transport time between Jebel Ali Port and client locations within Jafza. There is a bonded bridge that connects Jafza and Dubai South that connect Jebel Ali Port and Al Maktoum Airport, which greatly benefits companies that utilise sea and air freight,” Haywood explains.
Another admirer of Jafza is Jacky Panjabi, of Jacky’s Group. He owns two buildings in phase 1 and 2 of Jafza – acquired in 1997 and 2005 respectively - and recommends the zone for all the cost benefits and hassle-free documentation it offers. “If you own an industrial license in Jafza, you don’t even have to pay manufacturing duty. In accordance with the GCC law, if the product being manufactured in GCC it is exempted from duty. It can be any product. This is a big thing. That is a big boon for entrepreneurs from UAE,” he explains.
“The port is next door. My trailer doesn’t take time to clear the consignment. There is enough time given to clear the cargo. If there is any delay to clear the cargo as well. The customs gives you enough time to clear the cargo. If there is a delay in the cargo, Jafza steps in and really helps us out. These benefits are massive," said Panjabi.
Panjabi said he owns 100,000 square feet space in Jafza. “We built our first building in 1997 in phase 1 of Jafza. We built our second building in the second phase of Jafza in 2005. It was our 31st anniversary for Jacky’s Group and we celebrated in style.”
Sajan said Jafza rates are very competitive as well. “Today, it is cheaper to bring material from India to Jafza and re-export it lets say to Oman, than shipping directly from India to Oman. That is how competitive Jafza is.”
He added that the Danube Group deals with 1,500 cubic containers every month. “We deal with at least 100 containers every day.”
He [Sajan] recalled a light incident. “We purchased land in 2003 and our warehouse was built in 2005. Back then, ours was the biggest warehouse any building material company could have. So we decided to celebrate it in style and we threw a Bollywood style party inside the warehouse. It was the talk of town. There has been no looking back for us since.”