DMIC update

The Union cabinet is all set to clear the proposed $90-billion Delhi-Mumbai industrial corridor this week, imparting a much-needed momentum to infrastructure investments. The project, which envisages creation of seven new mega cities, a 1483-km fast-speed freight corridor, and industrial zones along the way, has already secured mandatory approvals from all related government departments. The department of industrial policy and promotion, or DIPP, is likely to move the proposal for cabinet nod this week itself, two government officials familiar with the matter said. “Cabinet is expected to take up the proposal shortly,” a finance ministry official said. The industrial corridor has proposed a revolving fund of Rs 18,500 crore to finance trunk infrastructure such as sewage disposal and roads, with the government providing 35-40% of the financing. The seven cities will get Rs 2,500 crore while Rs 1,000 crore will be available for planning and project development. “The aim is to create a business model out of urbanization and the trunk infrastructure would help in land monetization and undertaking-specific greenfield and brownfield industrial and physical infrastructure projects,” a DIPP official said. The DMIC proposal had been stuck with the Planning Commission for over two months. While the North Block gave its go-ahead in July, the commission's approval now will enable expeditious clearance of the proposal. DIPP, which comes under the commerce and industry ministry, will recast the institutional structure of the Delhi Mumbai Industrial Corridor Development Corporation, a special purpose vehicle created to implement activities under the DMIC Project. This would involve transfer of 51% equity of IDFC and IL&FS to government-run financial institutions. The government will continue to hold 49% in the venture.