Gujarat is emerging as India's Detroit
Chief minister is very business-friendly
Ahmedabad: In the middle of a strike at Maruti Suzuki's main factory that would cost India's largest carmaker $500 million (Dh1.83 billion) in lost production, the company negotiated a deal to invest $1 billion in new facilities on the subcontinent.
It was an unusual move, but — despite the troubles it and many other companies have had in India — Maruti was confident its new plant would roll out on time and without any hitches, for one reason: it will be built in the western state of Gujarat.
Ever since Tata Motors was unceremoniously ousted from the eastern state of West Bengal in 2008 over a land dispute, and successfully relocated to Gujarat, the state — and its controversial chief minister, Narendra Modi — have become known for their business-friendly, anti-union environment and emerged as India's answer to Detroit of the US.
"The main reason is because of the initiatives that have been undertaken by the chief minister," says Yaresh Kothari, auto analyst for Angel Broking. "He has been very proactive about inviting industrialists to the state and offering them quick access to land, which has become a major problem in the country."
This year alone, Ford and Peugeot Citroen have joined Maruti and Tata in making massive investments in the state, drawn in by attractive tax incentives, improved infrastructure and a streamlined land acquisition and approvals process absent from many other states.
— Financial Times
