EMC AT ANNUR, COIMBATORE FINAL DPRenvironmentclearance.nic.in/writereaddata/FormB/TOR/PFR/13_Nov... · One of the important objectives of the NPE is to achieve a turnover of about

EMC AT ANNUR, COIMBATORE – FINAL DPR

ADD‐ELCINA ELECTRONICS PARK PRIVATE LIMITED Page 2



CONTENTS LIST OF ANNEXURES ...................................................................................................................... 4

EXECUTIVE SUMMARY .................................................................................................................. 5

CHAPTER 1 .................................................................................................................................... 8

CONTEXT & BACKGROUND ...........................................................................................................

CHAPTER 2 .................................................................................................................................. 42

PROJECT OBJECTIVES ....................................................................................................................

CHAPTER 3 .................................................................................................................................. 45

TARGET BENEFICIARIES .................................................................................................................

CHAPTER 4 .................................................................................................................................. 48

PROJECT COMPONENTS ................................................................................................................

CHAPTER 5 .................................................................................................................................. 60

SUPPORT INFRASTRUCTURE .........................................................................................................

CHAPTER 6 .................................................................................................................................. 64

ENVIRONMENTAL IMPACT ASSESSMENT .....................................................................................

CHAPTER 7 .................................................................................................................................. 75

MARKETING STRATEGY .................................................................................................................

CHAPTER 8 .................................................................................................................................. 80

MANAGEMENT ARRANGEMENTS .................................................................................................

CHAPTER9 ................................................................................................................................... 93

MEANS OF FINANCE & PROJECT BUDGET ....................................................................................

CHAPTER 10 .............................................................................................................................. 102

TIME FRAME .................................................................................................................................

CHAPTER 11 .............................................................................................................................. 104

RISK ANAYSIS .................................................................................................................................

CHAPTER 12 .............................................................................................................................. 107

FINANCIAL & ECONOMIC ANALYSIS ..............................................................................................

CHAPTER 13 .............................................................................................................................. 115

SUSTAINABILITY ............................................................................................................................

CHAPTER 14 .............................................................................................................................. 119

CORPORATE SOCIAL RESPONSIBILITIES ........................................................................................



LIST OF ANNEXURES

1 Annexure 1 Architectural Design Report

2 Annexure 2 Electrical Design Report

3 Annexure 3 Plumbing Design Report

4 Annexure 4 MoUAIPL &GoTN

5 Annexure 5 (a) & 5 (b)

5(a) – Supply of Water: Copy of Communication from NTADL

5(b) – Bore well – Copy of Communication from the President, KuppanurPanchayat

6 Annexure 6 Copy of Application to TNEB

7 Annexure 7 Copy of Acknowledgement – Application for Environmental Clearance

8 Annexure 8 Detailed cost estimate for project

9 Annexure 9 Details of financial statement



EXECUTIVE SUMMARY Proposed project Greenfield Electronic Manufacturing Cluster (EMC)

Project location Annurtaluk in Coimbatore, Tamil Nadu. It is a part of the 1500 acre industrial park being developed for which a MoU has already been signed between the Government of Tamil Nadu (GoTN) and ADD Industrial Park (Tamil Nadu) Limited (AIPL) the Chief Promoter of the proposed EMC. From Annur town, the location is about 9 Kms from NH 209 connecting Coimbatore and Mysore and nearly 38 Kms from Coimbatore city.

Scheme and nature of activities involved in the project

To make India a global player in the field of electronics manufacturing and to offset disabilities faced by industries for reliable infrastructure, Electronics Manufacturing Clusters (EMC) Scheme was notified by the Ministry of Communications and IT, Government of India (GoI) in October, 2012 to provide support for creation of world‐class infrastructure for attracting investments in the sector. The EMCs scheme provides grant assistance for setting up EMCs across the country. The financial assistance under the Scheme is in the form of grant‐in‐aid for creating infrastructure and logistics.

As per the Scheme, a proposal for development and promotion of a Greenfield EMC on 157.6 Acres of land in Annurtaluk has been submitted by M/s. ADD‐ELCINA Electronics Park Private Limited to the Department of Electronics & IT (DeitY), Ministry of Communications and IT, GoI.

The proposed EMC project comprises of 163 plots of various sizes designed for sale as independent or combined units occupying 95+ acres. It would endeavour to bring the entire gamut of electronic manufacturing operations under one umbrella and facilitate all stages of the value chain of electronic manufacturing. Each plot would be connected by a road network along with all the common services like electric connection, sewer connection, central STP, treated water supply & storm water drainage, which can be utilized by the units within EMC. Further, common support facilities like tool room, CAD/CAM, testing, certification, R&D, administration, training and business centres and support services viz. employee hostel and mess, hospital, recreation facility, crèche, local shopping centre etc. The EMC would be a secured gated campus.

Details of special purpose vehicle (SPV)

Name of the SPV: ADD‐ELCINA Electronics Park Private Limited, Incorporated in June 2015 with CIN U31401KA2015PTC080857 Promoters: ADD Industrial Park (Tamil Nadu) Limited (AIPL) – Chief Promoter Om Metals Infraprojects Limited (OMIL) Adhunik Power Transmission Limited (APTL) Electronics Industry Association of India (ELCINA)



Master Plan The master planning is aimed at optimising the layout of the industrial plots with the following pattern of utilization: Processing Area (industrial plots & common / support infrastructure) – 86.5% Non‐processing area (common amenities) – 13.5%

Processing Area Processing area comprises of industrial plots and support infrastructure like roads, storm water drains, water treatment plants, sewage treatment plants, electrical substations, warehouse, buildings for administration, training, manufacture support and gate house etc.. The total area of 5,51,802Sqm. (136.6 Acres)

Non‐processing area Non‐processing area consists of other common amenities, which includes employee hostels, medical centre, clubhouse, worker welfare and green space with a total area of 86,050 Sqm. (21 Acres)

Project Cost Sl. No. Name of the component Amount (in INR Lakhs)

1 Processing area (% area)

a) Basic development (36%) 6021

b) Essential services (38%) 6282

c) Support services (6%) 1021

d) Manufacturing services (3%) 505

e) Government regulatory services (3.5%) 269

Sub‐total (86.50%) 14098

2 Non‐processing area

a) Welfare Services (3.4%) 2214

b) Green area (10.1%) 322

Sub‐total (13.50%) 2536

Total EPC cost of the project 16634

3 Land 1215

4 Administration expenses 493

5 CSR 83

6 Interest During Construction (IDC) 1131

Total Project cost including IDC 19594

Grant Calculation Grant Calculation

Processing / Non‐processing

Grant %

Grant Amount (in INR Lakhs)

Processing Costs 1,409,761,108 50% 7048.80Non Processing Costs 253,625,992

20% 507.25

Adm. Costs Allowed for Grant

3% 226.68

TOTAL GRANT 7782.74



Means of finance Source Amount (in INR Lakhs)

Grant 7783

Debt 8268

Equity (By Chief Promoter) 1736

Equity (By Unit holders) 1807

Total 19601

Employment generation Once fully established and populated, the Cluster expects to employ 16,000+ workers directly and another 32,000 indirectly. This is basedon the average capital investment of Rs. 14Crores per acre which adds up to about Rs. 1,300 Crores and an output of Rs.3,900Crores at a capital output ratio of 1:3.

Sustainability The proposed EMC would be operational from year 2 after receipt of finalapproval from DeitY. Sale of the plotsin the EMC is likely to take place in a phased and gradual manner. During the first year of construction 20% of the plots are expected to be sold and another 35% in the second year followed by 45% in the third year. During the operation and maintenance, a steady flow of revenue is expected from the maintenance charges collected from the unit holders, charges from use of tool room, testing, hostels, clubhouse, warehouse, for skill development services, communication service and other such income, which will sustain the EMC.For the infrastructure replenishment, a fee will be collected from the units of EMC once in 3 years for upgrading the infrastructure of the EMC which generates adequate cumulative cash reserves for the EMC. The NPV (as per the financial analysis) of the project is Rs. 694 Lakhs, IRR of the project is @ 14.31 % and the repayment period is 7 years and hence the project is economically viable.



CHAPTER 1

CONTEXT & BACKGROUND 1.1 Introduction:

Electronics industry is one of the fastest growing manufacturing industries in the world. The demand in the Indian market for Financial Year 2014‐15 stood at USD 90+ Billion and is expected to reach USD400 Billion by year 2020. At the current rate of growth domestic production can cater to only USD 100 Billion by year 2020 creating a demand supply gap of nearly USD 300 Billion which would be higher than oil imports and not sustainable. To correct this the Union Cabinet approved the National Policy on Electronics (NPE) in 2012 with a vision of transforming India into a global hub for electronic design and system manufacturing (ESDM) to meet both local and global demand. One of the important objectives of the NPE is to achieve a turnover of about USD 400 Billion by 2020 involving investment of approximately USD 100 Billion and increase employment to 28 million by 2020. This also includes achieving a turnover of USD 55 Billion by the chip design and embedded software industry and USD 80 Billion of exports in the sector. A major and important target of the NPE is to set up 200 Electronic Manufacturing Clusters which would enable and drive the growth of Electronics manufacturing. As part of the National Policy on Electronics (NPE) for promotion of Electronic Manufacturing Clusters (EMCs), an EMC scheme has been notified by the government vide notification no. 252 dated 22‐10‐2012 in part 1, Section 1 of the Gazette of India (Extraordinary). The scheme provides incentives including financial assistance in terms of a grant in aid to special purposes vehicles (SPVs) created for setting up EMCs. In line with the objectives of the NPE, to promote electronics manufacturing, ADD Industrial Park (TN) Ltd (AIPL) along with Om Metals Infraprojects Limited (OMIL), Adhunik Power Transmission Limited (APTL) and Electronic Industries Association of India (ELCINA) have formed an SPV to submit this final proposal for development and promotion of a Greenfield EMC on 157.6 acres of land near AnnurTaluk, Coimbatore District in the state of Tamil Nadu. This would be part of the 1500 acre mega industrial park that is being set up by AIPL for which a memorandum of understanding (MoU) with Government of Tamil Nadu (GoTN) has been signed on the 5th of November 2012. The detailed profiles of Chief Promoter and other Promoters of the SPV are provided later in the Chapter on ‘Management Arrangements’.



1.2 Electronics industry – India Electronics is now a key input in all aspects of human life and all sectors, including Telecom, IT/Computers, Consumer Appliances, Automotive, Medical, Lighting, Energy, Transportation and more. Further, the share of electronics in the form of hardware and software is rising by the day resulting in rapid growth of market for electronics, as mentioned above. This trend is bound to continue and gain further momentum. The size of the Electronics Industry in comparison with other sectors is estimated as follows: a) 4.40 times the size of Oil, Petrol and Minerals Industry b) 2.75 times the size of Chemicals and Plastics Industry c) 2.45 times the size of Food, Beverages and Tobacco industry d) 2.44 times the size of Transportation industry e) 2.20 times the size of Electricity, Water and Gas industry The birth of the Indian electronics industry can be traced to the sixties, when the Government took the initiatives of manufacturing space and defence electronic products for national security. This was followed by developments in consumer electronics, mainly the manufacturing of transistor radios, black and white TVs, calculators and other audio products. This was followed later in 1980s, with the manufacture of colour televisions, advent of computers and telecom products. India, though still a relatively small player in the world Electronics market, is growing very quickly with steady growth of the Indian economy. This is supported by supportive demographic trend of a growing and large middle class accompanied by rising incomes and aspirations. The demand growth is led by telecom products/infrastructure, computer & IT products, auto electronics, medical, industrial and consumer electronics.The electronics sector attracted foreign direct investment (FDI) worth Rs. 5,986.51 crore (USD 1.08 Billion at 2013 Exchange rate) during April 2000 to June 2013, according to the data released by the Department of Industrial Policy and Promotion (DIPP), Government of India. This FDI is not adequate and falls extremely short of the need to boost domestic manufacturing and keep pace with demand. While exports from India comprise a large range of electronic components and products for the following segments, the volumes are still quite low compared to competing countries:‐ a) Display Technologies b) Entertainment Electronics c) Optical Storage Devises d) Passive Components e) Electromechanical Components f) Telecom equipment g) Transmission & Signalling Equipment h) Semi‐Conductor designing i) Electronic Manufacturing Services (EMS)

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1.4 Overall industrysize & growth Revised estimates of the Indian ESDM industry indicate that the market was $68.31 billion in 2012 and projected to grow between 2011 and 2015 at a Compound Annual Growth Rate (CAGR) of 9.88 percent. The corresponding size of the market by 2015 was projected to be $94.2 billion. The following chart illustrates the total ESDM industry market growth. (Source: DeitY)

The total market (TM) for Indian ESDM (comprising of electronic products, electronic components, semiconductor design and electronic manufacturing services) was estimated to be $44.81 billion in 2012, representing a growth of 7 percent over the previous year. The TM is expected to grow at a CAGR of 11.5 percent and reach revenues of $64.85 billion by 2015. Total domestic market (TDM) for 2012 was estimated to be $17.07 billion, representing a growth of 11 percent over 2010. Growing a CAGR of 10.4 percent, the TDM is expected to scale to $22.66 billion by 2015. The chart below represents total market(TM) and total domestic market (TDM) for the Indian electronics market.



1.5 Industry segments market size & growth

The Indian Electronics industry is divided into six sub segments, namely Consumer Electronics, Industrial Electronics, Computer Hardware, Communication and Broadcasting, Strategic Electronics and Electronic Components and their market growth rates from 2008 to 2013 are as below:‐

a) Consumer Electronics: Consumer electronics include electronic equipment meant for everyday

use and are most often used in entertainment, communications, and to enhance office productivity. Some of the major products under consumer electronics include MP3 players, audio equipment, televisions, calculators, GPS automated navigation systems, digital cameras and playback and recording of video media such as DVDs, VHSs or camcorders. The Indian Consumer Electronics industry has experienced rapid changes over the last few years. These changes have been resultant of a booming Indian economy growing at 8% and above till end of last decade, the changing lifestyles, higher disposable incomes and greater affordability have been important factors in fuelling this growth. The consumer preference has also shifted towards products and devices that come with smart technology, innovative designs, and user friendly and are also aesthetically designed. This increase in growth premium products, not only in Metros but also in rural areas is going to provide the future growth stimulus for the domestic consumer industry. Figure below shows the production growth of consumer electronics segment for the period 2008‐20013.



b) Industrial Electronics: The industrial electronics segment includes critical hardware technologies and systems with built‐in software. It is a very challenging area which is multidisciplinary in nature requiring high level of technical skill in designing systems for applications in a variety of industrial sectors of the economy. Even though India has been having significant expertise in conceptualizing such systems and its erection and commissioning, the sector is very largely dependent on import of critical hardware and associated software. Large projects are implemented with total import of C&I (commercial and industrial) packages from abroad without any knowledge of its design. In most cases, this leads to higher initial cost and a much higher maintenance cost in the long run. The domestic industrial electronic consists of process control equipment, test & measuring equipment, medical electronics, power electronics equipment, industrial electronics and automation and analytical instruments. This is a mature segment but the incentives announced under the National Policy on Electronics should revive this sector. Figure below shows the industrial electronics segment production growth for the period 2008‐2013.

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c) Computer Hardware: The computer hardware market consists of the computers, storage, and other devices segments. The computers segment comprises: desktops and laptops. Storage segment includes memory sticks, CD packs, hard disks and other data storage devices. The other devices segment include: computer peripherals, PDAs, organizers, calculators and satellite navigation systems.The growing income as well as levels and increasing awareness of PC as an Educational device seem to have impacted the PC sales over the years, especially amongst the SECC segment where the young population seem to be driving adoption. The derived value of production for this segment for 2012‐13, is about Rs. 24,300 crores, as against Rs. 16,500 crore in 2011‐12, a growth of about 47%. Figure below shows the production growth of computer hardware segment for the period 2008‐2013.

d) Communication & Broadcasting Equipment: Communication Technology is a key driver for development and growth of this segment.Telecommunications is one of the few sectors in India, which has witnessed the most fundamental, structural and institutional reforms since 1991. In recent times, India has emerged as one of the fastest growing telecom markets in the world. The communication technology has taken a big leap forward and received the national recognition as the key driver for development and growth. India has the second largest wireless network in the world with nearly 750 connections. As on 31st December, 2012, the total gross telephone subscribers in the country was 895.51 million covering total wireless subscribers of 864.72 million and wire line subscribers of 30.79 million respectively. During the period, the overall tele‐density was 73.34 per cent overall urban and rural tele‐densities being 149.90 and 39.85 respectively. The break‐up of the Tele‐density with .respect to wire line and wireless are 2.52 and 70.82. The total domestic broadband subscriber communication, navigation and surveillance systems, base were 14.98 million in December 2012. This coupled with proliferation of handsets (supportive equipment), FM stations, set top boxes which are also being exported makes this segment an attractive destination. The estimated value of production for this segment for 2012‐13 is Rs. 55,000 crore as against Rs. 40,500 crore in 2011‐12, i.e., a growth of about 35.8%. The figure below shows the production growth of the

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1.6 Opportunities

As per the “Report of task force to suggest measures to stimulate growth of electronics manufacturing industry”, the electronics industry can significantly boost India’s GDP, generate employment, modernize processes and enable country’s inclusive growth. Domestic manufacturing companies have the opportunity to expand their production to USD 400 billion by 2020 with a very significant contribution to GDP, at 20% for 2020, at par with other economies.

“The Indian ESDM industry presents a huge opportunity and is expected to emerge as a vital contributor to the nation’s economy.

While we continue to dominate the high‐end semiconductor design space, we are also seeing a major shift in focus from just design to end‐to‐end product conception and manufacturing to truly dominate the global ESDM industry”. KapilSibal‐ former Minister for Communications and IT.

a) The electronics industry can increase employment in the country significantly, since some of its

segments, such as electronic system manufacturing, are human capital‐ intensive. The industry was estimated to employ about 10 million currently and this could grow to 28 million in 2020.

b) The electronics industry has a high potential for domestic value addition, especially in some of its segments, e.g., semiconductor design and electronics system/product design.

c) Electronics is driving the Digital India agenda and facilitates e‐governance, developmental schemes and initiatives launched by the government, e.g., SarvaShikshaAbhiyaan (SSA), Restructured‐Accelerated Power Development and Reform Program (R‐APDRP) and Mahatma Gandhi Rural Employment Guarantee Act (MNREGA). The government’s allocation of funds for developmental schemes and initiatives is close to USD 45 billion. However, IT intervention is required to ensure the effective implementation of these schemes and initiatives.

d) The government is in the process of setting up Common Service Centers (CSC) at the village level, increasing tele‐density, scaling up broadband access and power availability. These initiatives aim to modernize and transform India, enable equitable and inclusive growth and

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make ICT relevant for everyone in the country. Although these schemes require heavy investment, they offer huge opportunities for the manufacturing and design industries to create designs for products manufactured in India.

The Indian electronics system design and manufacturing (ESDM) industry is one of the fastest growing sectors in the country. Witnessing uninterrupted growth, the ESDM Sector in India is globally recognised for its consumption potential. Changing global landscapes in electronics design and manufacturing capabilities, and cost structures have turned the attention of global companies towards India. Companies from around the world are looking to build local capabilities in India not just to serve the resident market but also to cater to overseas markets. This has resulted in the development of indigenous capabilities across the ESDM value chain in India though different segments such as telecom electronics, automotive electronics, consumer electronics and industrial electronics, are at different stages of ecosystem development. The focus is currently on providing the necessary impetus and developing the missing links so as to make the local ESDM sector globally competitive. (F&S and IESA Study excerpts) Electronics industry can play a big role in providing products and solutions for other industry verticals. Such products and solutions include low cost devices, handheld devices, bio monitoring solutions, micro payment solutions, GIS, project monitoring solutions, and smart meters to enable various developmental initiatives of the government. The industry has the potential to leapfrog India to next generation of technology adoption and holds immense transformational potential for various industry verticals as given below:‐

Industry Vertical Present State Future Potential

Access No connectivity Wireless

Electro Mechanical Meters Smart Meters

Energy Incandescent lighting LEDs

Energy Shortage Green Energy/Energy Efficiency

Healthcare Accessibility & Cost Affordable Devices/Telemedicine

Education Limited Reach Digital/Virtual Classrooms

Digitization Analogue to Digital Electronic society/Unique ID/Digital TV, Radio

Security Human dependence Integrated surveillance systems

Others E.g. automotive High cost, High emission cars Low cost, Low emission cars



1.7 Market demand for key products

The market demand for various high growth products are as given below also the Figure below represents some of them graphically:‐

a) PC Tablets: According to MAIT, the apex body representing India's IT hardware industry,

training and R&D services sectors, tablet sales in 2012‐13 stood at 1.9 million units as against 0.36 million units in 2011‐12 witnessing a growth of 427 per cent. According to a recently published report by TechSci Research ‘India Tablet PC Market Forecast & Opportunities, 2018’, the tablet market in India is set to generate USD 2 Billion in revenue by the end of 2013. Also the revenues are expected to grow at the CAGR of 33% by 2018. India is likely to have the second‐largest user base in the world, and the largest in terms of incremental growth, with 330 million to 370 million Internet users in 2015. Given current downward trends in the costs of Internet access and mobile devices, India is on the verge of an Internet boom. In an evolution pattern unique to India, users who access the Internet only through a mobile or tablet device will constitute around 75 percent of new users and 55 percent of the aggregate user base in 2015, leading to increasing demand for content that is optimized for a small screen‐(McKinsey report).

b) LED Products: By 2020 the LED products market is expected to grow to USD 34 Billion

from a base of USD 1 Billion in 2010.Growing population and rise in income provides an impetus to the growth of the LED market in India. Demand from consumer electronics is expected to emerge as a major growth driver for the Indian LED market. Increasing usage in street lighting, public places and growing indoor lighting applications is expected to boost the growth prospects of the LED market in India.

c) DTH: Digitisation will drive growth in DTH market. By 2020 the number of subscribers is expected to grow to 200 Million. The government announced the digitisation of cable television in India in four phases, which would be completed by the end of 2014. The digitisation of cable television has led to increased demand for set‐top boxes, dish, cables, and other electronic components. The DTH market is expected to see its annual revenue grow to more than Rs. 28,500 crore (USD 5 billion) by 2020. Consumer demand for media‐rich home entertainment services is driving innovations and new revenue opportunities in the STB industry. Next‐generation STBs will become hybrid devices, integrating the video content from multiple signal sources such as broadcast television, premium VoD, and Internet‐based over‐the‐top (OTT) video services, providing value‐added capabilities like time shifting, and allowing content to be distributed to a variety of viewing devices including multi‐room TV networks, personal computers, portable media players, and other mobile devices. STB manufacturers are looking to decrease



the bill of materials (BOM) cost by using in‐house CAS solutions and low‐cost system‐on‐a‐chip (SoC) optimized with lower‐powered CPUs that support HD video, but only simpler graphical user interfaces.

d) Semi‐Conductor Design: Rising demand and availability of talent to boost growth in the semiconductor design market. By 2020, the semiconductor design market in India is expected to increase to USD70 billion from USD9.9 billion in 2012.Solid State Technology in Metering and Lighting induce Growth in Semiconductor Revenues.

e) TVs: India is the world’s third largest TV market. The Market is slated to grow to USD

17.7 Billion by 2017.

f) Telecom Equipment: Rising tele‐density in the country is fuelling high demand for telecom equipment. By 2020 the market is estimated to grow to USD 34 Billion. This is fuelled by rapid mobile phone penetration in the country. Demand for mobile handsets in India, the world’s second largest telecom market after China, will reach 350 million a year by 2020, and 505 million handsets will be made in India that year(Federation of Indian Chambers of Commerce and Industry and professional services firm Ernst & Young). The report titled “Mobile Handsets: Providing Mobility to Every Indian,” also stated that the average selling price of handsets in India will rise to $60 by 2020, compared with $47 in 2010. The study recommends that there is need to set up handset manufacturing cluster parks that would enable a sustainable ecosystem for the manufacture of mobile handsets in the country. One of the primary drivers of the sector is an increase in average household communication expenditure. The untapped rural market is expected to provide handset players the next phase of growth. The number of 3G subscribers is expected to cross 300 million by 2020, fuelling the growth of 3G enabled handsets.Further, buoyant SIM Growth and Massive Social Sector Investment will grow the market for Smart Cards and related products.

g) Flash Drives: The market growth is driven by massive Flash Adoption in Digital Cameras USB Flash Drives, A/V Players, Gaming & Navigators, Mobile Phones, Tablets, Solid State Drives, Internet Enabled TV and Set Top Boxes. Storage Growth to 34GB average per Device By 2016 is expected as per SanDisk estimates and Gartner forecast.

h) Smart Meters: The Smart Electrical Meter provides numerous advanced functions for

recording and checking electrical energy parameters for monitoring and billing purposes and for accurately assessing demand and supply, plugging power pilferage, preventing overdraws etc.Some smart meters also contain a chip, which can be used to provide voice connectivity to user. The model can communicate with each and every household when there is a power crisis and can process any request to restrict the load.The futuristic technology also has small‐time micro power producers (houses and offices)



using solar panel or wind which will contribute to surplus power to the grid and hence help consumers gets a rebate in their bills. The consumers can remotely control the power consumed by home appliances like air conditioners, washing machines or ovens to save energy and cost. All these gadgets can be remote‐controlled through the web or a mobile phone. The smart meter also has a display system that shows real‐time power usage by geysers, air‐conditioners, sump systems, and other gadgets. As per an asianpower.com report, while there are significant infrastructural development and capacity building issues, India is estimated to install 130 million smart meters by 2021. Unlike developed countries however, India has not introduced smart metering in a large scale until now. The government is also going to finalize these eight projects of worth Rs. 500 crores (USD 9.69 million) on smart grid implementation, which uses a combination of smart metering and various technologies to improve the efficiency and reliability power system for sustainable growth. This however remains as a high growth opportunity across the next decade.

i) Surveillance Cameras: Presently in India security solutions are still dependent on personnel security guards manning sensitive premises or even common commercial and residential locations. However, this is changing as seen in developed countries and security options aided by electronics devices are gaining firm ground, such as biometric (finger print readers, voice and iris scan), CCTV and control room monitor alarms. According to a recent analysis by ASSOCHAM, the video and surveillance and CCTV market in India is gaining at a CAGR of 30% a year and is likely to cross Rs. 2200 crores by 2015. The Indian CCTV market is currently poised at Rs. 1300 cores and accounts for about 40% of the Rs. 3250 crores worth total electronics security market in India.

j) Medical Electronics: Medical electronics too is growing rapidly in India and is set to

witness a critical mass effect. Electronic components, devices, and products are increasingly gaining importance in the healthcare sector. The medical electronics has reinforced the existing healthcare infrastructure in various ways, from digitizing medical test, diagnostics, and therapeutic procedures to enhancing the reach of healthcare through telemedicine and health IT. The medical electronics market is viewed as a sub‐segment of the medical devices market. The medical devices market may be classified into two major categories ‐ devices that require external energy source to be operational (powered) and those that do not require any external energy source. Powered devices may be divided into three product categories ‐ equipment, implants, and disposables. Equipment accounts for the largest pie of the total market followed by medical implants and disposable segments, respectively. It is also the fastest growing segment and is largely dependent on imports. This can be further segmented into surgical equipment, diagnostics, and life support equipment. The medical electronics industry has witnessed double‐digit growth in the past couple of years and this growth trajectory is expected to continue. According to a Deloitte FICCI report Indian Medical



Electronics Industry Outlook 2020, the Indian medical electronics industry constituted sales of Rs. 5000 crores (USD 1 billion) in 2010 and is projected to reach Rs. 32,500 crores (USD 6.5 billion) by 2020, at a CAGR of 17 percent.

k) Automotive Electronics: Automotive Electronics is gaining share in the BOM of an automobile. Beginning with the requirement of providing enhanced engine control, the current breed of automobiles has become more and more reliant on electronics, enabling them in going faster, even while providing highest levels of safety. Today's contemporary cars have evolved into electronic machines, with more and more operations being controlled with electronic control units (ECUs). For instance, a premium segment car can comprise up to 150 such ECUs for controlling virtually all vehicle‐related aspects. These can include an engine control unit for managing a car's efficiency, a steering and surround view system for preventing accidents, a telemetric system offering information related to local hot spots, an electronic stability/traction control for maintaining appropriate steering control, and sensors for deploying airbags in the event of a collision. The major trends driving demand for increased penetration of electronics in automobiles include regulatory mandates for improving fuel economy and stringent emission standards as well as requirements for advanced safety systems, consumer demand for safety & security and comfort & convenience features, and growth of hybrid and electric vehicles. Environmental issues and highly stringent government regulations have been forcing auto OEMs to accord greater importance to fuel efficiency. The global market for Automotive Electronics, estimated at USD 191.3 billion in 2013 and forecast to be USD 204.6 billion in 2014, is further projected to reach USD 314.4 billion by 2020, thereby maintaining a CAGR of 7.3% between 2012 and 2020. OEM Automotive Electronics accounted for a share of 86.3% in 2013 equating to USD 165.2 billion in the overall Automotive Electronics market. This is forecast at USD 177.2 billion in 2014 and expected to register a 2012‐2020 CAGR of 7.6% to reach projected USD 277.1 billion by 2020.TE Connectivity in a study on “Electronics Manufacturing in India, in Pursuit of Greater Localization” found out that the Indian automobile industry has experienced significant growth in the last decade.The share of electronics in automobiles is estimated to grow from USD 9 billion in 2013 to USD 26 billion by 2020. Electronic components used in the automotive industry are estimated at 10 percent of the total bill of materials, and this is expected to increase by about 10 percent annually over the next ten years.



Source: IBEF

9.9

70

2012 2020 E

Semiconductor Design Market Growth IndiaUSD Billions

27.8%CAGR 7.7

17.7

2012 2017 E

TV Market India USD Billions

18.1%CAGR

11

34

2012 2020 E

Telecom Equipmet Market Growth India

USD Billions

11%CAGR

1

6.5

2010 2020 E

Medical Electronics Market Growth India USD Billions

17%CAGR

11

34

2012 2020 E

Telecom Equipmet Market Growth India

USD Billions

11%CAGR

1

6.5

2010 2020 E

Medical Electronics Market Growth India

USD Billions

17%CAGR

162.5

314.4

2013 2020 E

Global Automotive ELectronics Market

USD Billions

7.6%CAGR

9

21

2013 2020 E

Share of Electronics in Automobiles India

USD Billions



1.8 Top 25 products

Top 25 products (as by F&S, IESA Study) that account for 80 percent of the overall electronics Total Market (domestic and imports) revenues for 2012 are listed in the chart below:‐

Top 20 Products that account for 80% of Market

1. Mobile Phones 14. Printers and MFD

2. Flat Panel Display (FPD) TV 15. Routers and Switches

3. Notebooks 16. Car Radio

4. Desktops 17. CFL

5. Digital Cameras 18. Energy Meters

6. Inverters and UPS 19. Digital Instrument Clusters

7. Memory Cards and USB Drives 20. Smart Cards

8. 4W EMS 21. PON, GPON ONT

9. LCD Monitors 22. Tablets

10. Servers 23. LED Lighting

11. Base Stations 24. Payment Terminals

12. Power Supplies 25. 2W Ignition

13. Set Top Box

The IESA‐ Frost & Sullivan report

1.9 Government policy support & initiatives

The Government of India is increasing its focus on ESDM sector and aims to transform the country from a consumption‐driven market to the one that has manufacturing capability to meet local and export related demand while simultaneously focusing on producing high value add electronic products. This section describes various schemes the Government has launched to give a boost to manufacturing of electronics in the country as well create an entire electronics ecosystem. These schemes are gradually being understood and utilised by the industry for obtaining their benefits for enhancing competitiveness and business growth.

1.10 National policy on electronics (NPE)

The Cabinet on 25th October, 2012 approved a National of Electronic Policy (NPE) 2012 covering a comprehensive set of schemes for promotion of Electronics System Design and Manufacturing (ESDM). The key objectives of this policy are achieving a turnover of USD



400 Billion by 2020 involving investment of about USD 100 Billion and generate approximately 28 million jobs. Key incentives announced under this scheme were the Electronics Manufacturing Cluster Scheme (EMC), the Modified Special Incentive Package Scheme (M‐SIPS) and Preference to domestically manufactured electronics goods (Preferred Market Access [PMA]). The other focus areas of the policy are Human Resource Development, Promotion of exports, Cyber Security, Strategic Electronics, R&D, Handling E Waste and setting up of Semiconductor Fab in India. Approvals have been accorded for setting up of two semiconductor fabrication units in the country, entailing combined investment of USD 8.6 billion, one led by Israel's Tower Semiconductor Ltd. (in partnership with IBM) and the other by Franco‐Italian STMicroelectronics N.V. (in partnership with Hindustan Semiconductor).

Some of the key initiatives under NPE are as below:‐ a) EMC Scheme: In October 2012, the Government notified its Electronics Manufacturing Cluster

(EMC) scheme to provide world‐class infrastructure to attract investments in India’s ESDM sector. According to the scheme, the Government will offer financial support for implementation of EMCs that will help development of entrepreneurial ecosystem in the country, drive innovation and catalyse its economic growth by increasing employment opportunities and tax revenues. Key features of the scheme:

I. The proposed EMCs scheme supports setting up of both Greenfield and expanding or

modernising Brownfield EMCs. Upto 50% subsidy is available for infrastructure development in a Greenfield Cluster and upto 75% for any modernisation and Common Facility Centre in a Brownfield Centre. The Government has approved a number of proposals for setting up EMCs and for M‐SIPS incentives to units located in these EMC’s.

II. The Government would support a Special Purpose Vehicle (SPV), which should be a legal entity that is duly registered for this purpose. The SPV may be promoted by private companies, industry associations, financial institutions, R&D institutions, state or local governments or their agencies and units within the EMC.

III. The SPV will develop, operate and maintain infrastructure, amenities and other

common facilities created in EMCs.

IV. The SPV should consider including an academic or research institution as part of it for suitable academic‐industry linkages.

V. EMCs will use existing Information Technology Investment Region (ITIR) wherever

available.



b) Modified Special IncentivePackage Scheme (MSIPS): This Scheme provides fiscal incentives as part of a special incentive package to promote large‐scale manufacturing in the ESDM sector under its Modified Special Incentive Package Scheme (MSIPS). The objective of the scheme is to remove impediments in manufacture of electronic products, e.g., the high cost of power and finance, high transactional costs and poor base of supply chain, and create a level‐playing field for the development of an indigenous electronics‐manufacturing eco‐system in the country. The scheme has been extended by 5 years w.e.f. August 2015 and is now available till August 2020. These incentives offset, past disadvantages such as high tax, cost of power, finance and freight, high transaction costs etc. to a great extent. Comprehensive details of the scheme are available on DeitY website.

i. Capital subsidy up to 20‐25% for 10 years on Capex. ii. Reimbursement of CVD/excise for capital equipment in non‐SEZ units. iii. Reimbursement of central taxes and duties for 10 years in select high tech units like

fabs and ATMPs. iv. Available for the entire value chain of identified electronics products, manufacturing of

equipment for electronic production and select raw materials. v. Production subsidy at 10% of production turn over (ex‐factory) for fabrication and

ATMP of analogue mixed semi‐conductor chips, power semi‐conductors OLEDs, PCB’s etc. (introduced in revised MSIPS on 3rd Aug 15).

vi. Incentives available for 10 years from the date of approval.

c) Preferential Market Access: The Government has notified its policy of preferring domestically manufactured electronic products for procurement by all government ministries/departments (except Defense). The policy is applicable for goods purchased for the Government’s own use as well as for PPP projects and PSU’s. The definition of domestically manufactured electronic products requires that such products are manufactured by companies that are established and registered in India (including contract manufacturers but excluding traders).

d) The benefits of National Manufacturing Policy and National Investment & Manufacturing Zones to be available to EMCs.

India has entered into Free Trade Agreement (FTA) / Preferential Trading Agreement (PTA) with a number of countries / trading blocs (Thailand, Singapore, ASEAN, Korea, SAFTA, etc.) and more Agreements are under negotiation, wherein import of electronics hardware from these countries shall be allowed at preferential rate of import duty, which is lower than the normal tariff rate. 100% Foreign Direct Investment (FDI) is allowed under the automatic route in the ESDM sector. In case of electronics items for defense, FDI up to 49% is allowed under the government approval route, whereas anything above 49% is allowed through the approval of the cabinet committee on security. Two government‐driven initiatives to drive demand – National Knowledge Network & National Optical Fibre Network. Large demand generated due to government schemes like the National



Knowledge Network, National Optical Fibre Network, tablets for the Education sector, a digitization policy and various other broadband schemes. Venture funds with a strong focus on electronics planned include the Electronics Development Fund, Walden India Fund, KITVEN Fund and the SIDBI Fund. Electronic Sector Skills Council and Telecom Sector Skills Council have been set up for establishing an effective and efficient ecosystem for developing and imparting outcome‐oriented skills for the ESDM sector. A total of 90,000 people are to be supported under the Skill Development Scheme in six different states.

1.11 Financial support

Additional financial incentives are being offered by the Central Government to promote ESDM in the country and these have been introduced in the last Union Budget. These include correction /reduction in Customs Duties on specific inputs to correct inverted duties and also to reduce costs of Manufacturing.

SAD has been reduced to address the problem of CENVAT credit accumulation. On all goods except populated PCBs, falling under any Chapter of the Customs Tariff, for use in manufacture of ITA bound goods; SAD has been reduced from 4% to Nil.

1.11.1 Excise duty structure on certain goods is being restructured of which some items are as follows

1) Wafers for use in the manufacture of integrated circuit (IC) modules for smart cards from

12% to 6%. 2) Inputs for use in the manufacture of LED drivers and MCPCB for LED lights, fixtures and LED

lamps from 12% to 6%. 3) Mobiles handsets, including cellular phones from 1% without CENVAT credit or 6% with

CENVAT credit to 1% without CENVAT credit or 12.5% with CENVAT credit. NCCD of 1% on mobile handsets including cellular phones remains unchanged.

4) Tablet computers from 12% to 2% without CENVAT credit or 12.5% with CENVAT credit. 5) Specified raw materials [battery, titanium, palladium wire, eutectic wire, silicone resins and

rubbers, solder paste, reed switch, diodes, transistors, capacitors, controllers, coils (steel), tubing (silicone)] for use in the manufacture of pacemakers to Nil. There are more such items listed in the relevant Union Budget notification.

1.11.2 In order to provide a further fillip to companies engaged in manufacturing, benefit through an

Investment Allowance in the form of an additional deduction of 15% of cost of new P&M, exceeding INR 250 Million that is acquired and installed during any previous year, until 31.3.2017. Under the existing provisions of Section 35 AD of the Act, investment‐ linked tax incentive is available by way of allowing deduction of the whole of any expenditure of a capital



nature (other than expenditure on land, goodwill and financial investments) incurred wholly and exclusively for purposes of the “specified business” during the previous year in which such expenditure is incurred.

1.11.3 Export Incentives:Focus product scheme – 2% duty credit scrip, Special focus product

scheme – 5% duty credit scrip.

1.12 Make in india initiative

This is a major national programme designed to facilitate investment, foster innovation, enhance skill development, protect intellectual property and build best‐in class manufacturing infrastructure. The government has undertaken a number of initiatives to facilitate setting up business in India and this is a key focus area of the current government. Driven by the Prime Minister’s Office, large scale promotional measures are being taken by the Government for ‘Make in India’.

1.13 Tamil Nadu: electronics industry & investment attractiveness

Chennai, the capital of the state has emerged as the largest electronic hardware manufacturing hub in India. Tamil Nadu ranks first in the country in electronic hardware manufacturing (20‐25 per cent of national production). The state has the advantage of abundant skilled manpower at relatively lower wages coupled with harmonious and peaceful industrial relations. Tamil Nadu houses major multinationals, including Motorola, Dell Computers, Samsung, Sanmina‐ SCI, Flextronics and Nokia‐Siemens, besides more than 30 components suppliers. Chennai is the hub of electronic manufacturing in Tamil Nadu and hosts a large number of companies especially at Sriperumbudur and Oragadam. Among the recent developments is Lenovo’s announcement that it will resume the Motorola facility near Chennai and produce six million units of Lenovo and Motorola phones in a year. Sony, too, has announced it will start manufacturing TV sets in the state, while Videocon's consumer durables factory is set to go on stream soon. Dell, too, has reportedly held talks to expand capacity. A list of the major companies and their activities are as shown in table below:‐



Company Products Investments in Rs

crores

Flextronics Electronics Hardware and mobile phone components

450

Samsung Consumer Electronics 450 Motorola Mobile Handsets 135 Dell Computers 280 Sanmina Electronics Hardware 225 Moser Baer PV Panels 200 Signet Solar PV Panels 2000 TAPPI Semiconductor Semiconductor testing & packaging 1000

Nokia Siemens Mobile handsets and Communication networks

300

BYD China Mobile handsets components 350 Salcomp Finland Mobile handsets components 120 Perlos Finland Mobile handsets components 124 Wintek Taiwan Mobile handsets 161 Jabil,USA Mobile handsets 310 Laird Tech USA Mobile handsets 310 Polymatech Japan Keypads for mobile handsets 82 Shinetsu Japan Keypads for mobile handsets 47 TVS Electronics Computer Peripherals 100 Dixon tech Color TV 37 Natronics Semi Conductor Packaging 65

1.14 Vision 2023 at a glance

The State of Tamil Nadu has always been in the forefront of economic growth in the country. The State has made impressive strides over the years to carve out a niche for itself in the fields of engineering, automobiles, textiles, leather, Information Technology, electronic hardware and hi‐technology industries and the Gross State Domestic Product (GSDP) stood at Rs.4,51,313 crore at constant prices in 2012‐13.

a) The industrial GSDP of Tamil Nadu grew at an impressive rate of 9.60% from the year 2005‐06 to

2012‐13 at constant prices.

b) The Vision 2023 Tamil Nadu document envisages Tamil Nadu to be the most prosperous and progressive State with no poverty by the year 2023. Towards achieving this major goal, manufacturing sector is assigned the key role of energizing the economy and creating a virtuous circle of enhanced competitiveness, efficiency and vibrancy in all sectors and galvanize the citizen and other stake holders towards reaching the targets in unison. Under this strategy, one of the 10 thrust areas identified in the document is acceleration in the economy and achievement of long term goals by increasing the share of manufacturing in the State economy at the annual rate of 14% ultimately reaching the target of 22% by 2023.



c) To maintain its position as a progressive State, the Government has recently taken proactive

steps like the release of Vision 2023 Tamil Nadu document, formulation of Tamil Nadu Infrastructure Development Act, Rules and Regulations, along with Tamil Nadu Transparency in Tenders (Public Private Partnership and Procurement) Act and Rules. The United Nations Report on Probity in Public Procurement has recognised Tamil Nadu as the first State to have a legislative frame work to deal with Public Private Partnership procurement. Recognising the importance of quality infrastructure, the Tamil Nadu Infrastructure Development Fund (TNIDF) and a Project Preparation Fund (PPF) have also been set up and in 2013‐2014; Rs.2000 crores has been provided for the Tamil Nadu Infrastructure Development Fund and Rs.200 crores for the Project Preparation Fund.

1.15 Achievements & attractiveness

a) Traditionally, Tamil Nadu has been in the vanguard of industrialization among the Indian States. The State has had a strong presence in textiles, engineering, automobile production and auto components manufacture and recently in Information and Bio Technology sectors. Tamil Nadu has always been a safe haven for the investors owing to a favourable business climate, excellent infrastructure for trade and investment, outstanding law and order maintenance, peaceful industrial relations and healthy socio‐economic reforms.

b) Among the Indian States, Tamil Nadu is now ranked: i. First in the number of factories ii. First in the number of workers employed in the factories sector iii. Third in Gross Industrial Output and iv. Third in Net Value Addition

c) More than 3000 foreign JVs and 100% foreign subsidiaries including Ford, Hyundai, Saint

Gobain, Nokia, Motorola, Dell, Renault‐Nissan, and Daimler, in addition to major local manufacturers like Ashok Leyland, TVS group, Titan, Murugappa group, cement companies etc., have manufacturing bases in Tamil Nadu with a Foreign Direct Investment (FDI) of over USD 10.0 billion. Tamil Nadu is increasingly becoming the choice of destination for foreign investors, which provides them with a global reach. Ranked among the top three Indian States in terms of Purchasing Power Parity (PPP), Tamil Nadu is a haven for all those looking for a rich cultural heritage, a highly productive work force, excellent infrastructure and cost‐effective operations. Each of these facts is substantiated by an enviable track record.

d) Tamil Nadu is to‐date the only State to attract seven automobile giants‐Ford, Hyundai, Mitsubishi, Daimler, Nissan, Renault and BMW. As on date, Chennai, the capital of Tamil Nadu and the Detroit of South Asia, has an installed capacity to produce 13, 80,000 cars and about 3, 50,000 commercial vehicles each year.

e) Caterpillar, USA and Komatsu, Japan chose Chennai to establish their large earth moving

equipment manufacturing plants. Chennai is now emerging as one of the “Top 10” Global



Automobile manufacturing centres. The State is also the preferred choice for over 350 large auto component manufacturers accounting for more than 35% of India’s auto components production.

f) A comparison of the total operating costs across various investment destinations in India would

place Tamil Nadu ahead of the rest and in a very favourable position to offer investors opportunities they would find hard to resist. Chennai serves as the most cost effective production base for export markets by many MNCs.

g) Tamil Nadu is known as a major exporter of Leather and Leather Goods, Textiles and Garments,

Automobiles and Components, Engineering Goods, Castings, Pharmaceuticals, Spices, Agro‐Products, Marine Products, Electronic Hardware and, of course, Software.

h) Tamil Nadu offers an abundance of relevant skills, robust IT infrastructure and easily available

real estate. Chennai is the choice of international finance majors as well ‐ Stanchart, World Bank, Citibank and ABN‐AMRO Bank have set up their back office operations in the city. BPOs and off‐shore operations have also preferred to operate from Chennai. With more than 1,780 IT / IT Enabled Services (ITES) companies, over 3, 75, 000 professionals and annual IT exports of Rs.50, 000 crore, Chennai, with its IT Bay Area, towers over other major cities as an IT and ITES powerhouse.

i) Tamil Nadu has an enrolment of over 1,82,000 graduate engineers from 553 engineering

colleges, 1,20,000 diploma holders from 501 polytechnic institutes, 9,05,000 science and arts graduates, and over 35,000 software engineers.

j) Tamil Nadu has an enrolment of over 1,82,000 graduate engineers from 553 engineering

colleges, 1,20,000 diploma holders from 501 polytechnic institutes, 9,05,000 science and arts graduates, and over 35,000 software engineers. The State is blessed with a talent pool of keen minds, well‐honed expertise and specialized educational institutions like Anna University (the World’s largest engineering university), Indian Institute of Technology, Madras, the National Institute of Technology, Trichy and the Madras Institute of Technology and many other private institutions that serve as alma mater to some of the sharpest brains in the country, from where a legion of top notch engineers gear up to take on the world. The Government has set up the Indian Institute of Information Technology at Srirangam near Tiruchirapalli recently to take higher technical education to the next level for the coming decades.

k) The State also complements its skilled manpower with salubrious working conditions, a peaceful

industrial climate, committed workforce and extremely competitive wage rates that offer substantial cost savings. In short, when it comes to human resources, Tamil Nadu is the “Number 1” in skilled manpower availability.

l) The installed capacity of conventional energy sources in Tamil Nadu is 11,415 MW. Tamil Nadu

is the undisputed Leader in wind power generation with an installed capacity of 7,145 MW. The renewable energy capacity of the Tamil Nadu is 30% of the total installed renewable energy



capacity in the country. The State has unveiled the Solar Policy proposing to add 3000 MW solar power.

m) With the second largest coastline in the country of around 1076 Kms, a network of 3 major

ports and 23 minor ports4 that includes India’s most efficient container port at Chennai, Tamil Nadu has effectively harnessed the might of the oceans to provide the perfect gateway for investors to reach out to the world. Its climate favours year‐round port operations.

n) Travelling within Tamil Nadu or to any other part of the world from the State has been made

extremely convenient, through extensive connectivity in the skies, on land and across the waters. 650 plus direct international flights a week and passenger traffic of over 4.50 million per year make Chennai’s international airport the perfect launch pad, with excellent connectivity to Europe, USA, the Gulf and East Asia.

o) Be it apparel or leather, food or textile processing, biotechnology or IT, the State Government of

Tamil Nadu has developed industry‐specific parks that help promote products from each industry. In the Private Public Partnership (PPP) mode, the Government of Tamil Nadu has promoted the Mahindra World City, a modern self‐contained industrial park, on the outskirts of Chennai. This is India’s first operational Special Economic Zone (SEZ) created with world class infrastructure, offering Plug and Play facilities.

1.16 State government incentives as per industrial policy 2014

While a state electronic policy is being developed the following are the incentives announced vide state industrial policy of 2014. a) Tamil Nadu has an incentives package structured to encourage Value‐addition and local

sourcing and provides support for projects depending on investment size. GoTN provides quality and reliable infrastructure support including Power and Water supply, roads, communication, waste disposal, etc. The state also ensures a Single Window Facilitation & In‐principle composite approval on a fast‐track mode within 30 days. The state is on the verge of declaring an Electronic Hardware Policy.

b) Power supply to Industries: All units with demand of more than 10 MVA will be provided with reliable supply at 110 KV or 230 KV level depending on the eligibility. Uninterrupted power supply will be given to the projects if the same is covered by MoU or Government Order (non‐MoU).

c) Inclusion of Investment made in captive power plants: Captive power plants will be treated as eligible fixed assets for the purpose of the structured package of assistance. “Captive Power Plant” for this purpose means a power plant set up to generate electricity primarily for the units’ own use.

d) VAT refund on Capital Goods for establishing captive power plants: Refund of 50% of the VAT



paid on purchase of capital goods exclusively for captive power generation within the construction period, provided they are manufactured in Tamil Nadu.

e) Promotion of desalination plants and waste water treatment and recycling plants: Developers of Industrial parks/ SEZs/ Industry clusters, etc. will be provided incentives to set up desalination plants/ waste water treatment and recycling plants. Also, the Government will encourage industries to undertake large waste water treatment and recycling plants on the Public Private Partnership (PPP) mode for treating urban sewage to industrial grade water. The industries will be encouraged to adopt measures for rainwater harvesting system to recharge the aquifers in the industrial area.

f) Cluster level skill development: This Initiative will focus on specific existing clusters in the auto,

leather, textiles, and electronic hardware sectors. A Cluster Human Resources (HR) Skills Development Committee will be established in each major cluster with the membership of engineering colleges, polytechnics, ITIs, arts and science colleges in the vicinity and the participating industries to set targets for training and the revision of course content of these institutions.

g) Subsidy for quality certification / Patent registration: The Government will reimburse 50% of

the expenditure incurred by the industrial units subject to a maximum of Rs.1.00 lakh, in getting the BIS, ISO 9000 / 14000 or any other national or international certification or patent registration.

h) Promotion of R & D: In order to encourage Research and Development in manufacturing sector,

companies investing in R & D facilities will be incentivised. For capital goods to be used in setting up hi‐technology R & D centres VAT would be zero rated. Such capital goods shall not be used for commercial production and be used exclusively for R & D.

i) Flexibility in labour laws will be adopted without compromising labour welfare. Subject to

applicable labour laws and within the parameters of the Industrial Employment (Standing Orders) Act, 1946 (Central Act 20 of 1946), flexibility in employment conditions including flexible working hours for women and shorter and longer duration of working hours, 24x7 operations (3 shifts), employment of women in the night shifts and flexibility in hiring contract labour will be permitted.

j) To avoid procedural delays in getting statutory clearances from various authorities, the

Government of Tamil Nadu has established a Single Window facilitation mechanism under the Guidance Bureau to accord in‐principle composite approval for pre‐ project clearances at the State Government level. A Committee headed by the Chief Secretary will monitor the progress of final approvals of all such cases.

k) Electricity tax exemption is also available depending on investment amount and employment

generated. For example an investment of Rs 5 to 50 crores in fixed assets and generation of 100 direct jobs, Rs 0.30 crores will be given as capital subsidy and electricity tax exemption of 2



years will be provided. 1.17 Coimbatore industry & investment attraction

Traditionally, Coimbatore has a recall as a strong industrial base predominantly in the automotive components, textiles, and pump sets businesses. The trade in Coimbatore accounts for a total annual turnover of Rs. 16000 crores.Coimbatore has a thriving market in the automotive components market. The market share of Coimbatore in automotive components is around 25% ‐30% out of the total Indian automotive component business. The Small and Medium Enterprises caters to supply requirements of Indian automotive OEMs such as MUL and TATA. Coimbatore also is home to pump set manufacturers. About 60 % of the water pumps and 40 % of the motors used in India are made in Coimbatore. The Coimbatore region is home to more than fifty thousand large, medium and small scale enterprises doing thriving business over the years. When it comes to the leading manufacturing and industrial hubs in south India, Coimbatore takes pride of place. Coimbatore is the Second largest industrial region in Tamil Nadu with a successful entrepreneurial and disciplined work culture. It is the highest revenue yielding district in the state even ahead of Chennai, thus making it one of the fastest‐growing second‐tier metro cities in India.

1.17.1 Evolving businesses

The earliest form of enterprise in Coimbatore was the evolution of a well irrigated system. The irrigation innovation was necessitated by the droughts that the region underwent in extreme climates. The soil conditions were and are still extremely palpable for cotton cultivation. The textile trade witnessed a healthy growth with an entry into the international markets. The developments led to the establishment of the Coimbatore spinning and weaving mils consequently. This was among the first step from the transformation of an agriculture‐based business to an industrial based business. Envisioning the growing role of cotton weaving and spinning mills, the farming community moved up the vertical chain to undertake processing of cotton yarn into spun yarn where an attractive export market existed. These pioneering efforts gave way to textile capital goods business that offered a captive market for growth. What began as a focused center for the manufacture of textile motors in the early 1900s has today become a multi – disciplinary entity that is capable of catering to voluminous demands in the international market. Tooling Divisions were incepted primarily as captive units for manufacturing houses and have become a major engineering activity in the region today. With time, many tooling divisions became profit centers of their own, owing to the consistent investment in technology. Today several corporate houses offer precision tooling services to global industries. The light engineering industry in the Coimbatore region also specializes in offering customized engineering solutions for diverse requirements. This expertise could be translated into potential new business opportunities. How the businesses evolved in Coimbatore is as per Figure below:‐



The city is the second largest software producer in Tamil Nadu, next only to Chennai. IT and BPO industry in the city has grown greatly with the launch of TIDEL Park and other planned IT parks in and around the city. It is ranked 17th among the global outsourcing cities. Companies like Aditi Technologies, Cognizant Technology Solutions, Wipro, Infosys, Robert Bosch GmbH, IBM, Tata Consultancy Services, Tata Elxsi, Dell, CSS Corp and KGISL having a presence in the city.

1.17.2 Electronic manufacturing There are a number of small/micro sized companies in Coimbatore engaged in various electronics related manufacturing and marketing activities. A sample list of micro/small sized companies is as per Table below. As seen from the table the strength of the area is towards existing industries like automotive components, textiles and pump sets. The engineering industry base in Coimbatore has not been fully leveraged and forms an attractive proposition for setting up an EMC in the region.

Cotton Farming

Spinning Mills Export Opportunities

Farm Based Machine Tools

Machine Tools Automotive Engineering

IT/ITES

EMC

1800

Pioneering Local Communities initialising farming

1920

Local Communities identify export opportunity during

1900

British ushered in the Industrial Era by setting up the Coimbatore Cotton and weaving Mills association

193‐40

Burgeoning demand for cotton from the region lead to mechanisation of textile mills

1920‐30

Cotton Industry paved way for farm related industrial equipment

1930 onwards Diversification into auto components

opened new market for entry

Today

Traditional businesses are converting IT/ITES into new business

Today

Location favours

electronics



Company Activity

Indus Electronics India Pvt Ltd Electronic electrical instruments and textile machinery spare parts

Electronics & Controls Corporation

Control Engineers and System Designers

Mighty Electronics Equipment Corporation

Mfg:‐ Electronics lab equipment

Applied Electronics Corporation Stamping for Motors Pumps, Sheet Metal Boxes

Lakshmi Electro ‐Tech Industries Mfg :‐ Electrical & Electronics, Electrical Control Panels Servo Voltage Stabilizers

B.J. Electronics Pvt Ltd M PP Plastic Film Capacitors

Electronics Signals & Controls Switch Boards & Control Panels

Getech Electronics Pvt Ltd Fabrication of Switch Boards & Control Panels

Abirami Electronics Pvt Ltd Computer / printer components

Statex Electronics Textile Testing instruments

Salzer Electronics Ltd Mfg: ‐ Rotary Switches & its allied switch gear products

Accurate Electronics Mfrs. & Assembling of Electronic Weighing Scales

Balaji Electronics Electronic motor run capacitors & mosquito swatter bat

Able Electronic Services Mfrs of Servo Stabilizer , UPS , CVT , Auto Transformer & Batteries

Textro Electronics AC/DC Drives, Electronic Equipment& Controls, Electrical Control Panels

Ashwin Electronics Mfg: ‐ Electronic Fair Metres

Techno Electronics & Instruments

Textile Testing Instruments for Cotton, Yarn & Fabric, Moisture tester

Renson Electronics Voltage Stabilizers Battery Chargers, UPS Powder Coating ‐Job Work

Cat ‐ Cam Electronics Thermal over load protector

Textek Electronics Private Limited

Automotive Electronic Instruments Manufacturer

Edison Semiconductor Pvt Ltd Electric vehicle technology

Universal Circuits Electric and Electronic Circuit Board Manufacturer

Arvey Sales Company Electronic Weighing Machine and Sales Manufacturer

The Everest Scales Company Electronic Weighing Machine Manufacturer

BJ Electronic Private Limited Companies, Electronic Component Manufacturer

Micro‐V Electronic Instruments Electronic Tester Manufacturer

Gowri Electronics Electromagnetic Relay Manufacturer

Power Electronics Dish Antenna Manufacturer

Abirami Electronics Private Limited

Sheet Metal Components Manufacturer

Sinic Electronics Private Limited Money Count Machine Manufacturer



1.17.3 Talent availability Coimbatore is home to five Universities, a large number of Engineering colleges, 85 Arts, Science and Commerce colleges. Apart from an exciting business environment, Coimbatore has a substantial pool of manpower resources well qualified for engineering and computer software related professions. Coimbatore is an educational hub of Tamil Nadu. There are 40 Engineering Colleges within 40 Kms from Annur (proposed project location) which offers courses related to electronics. This is over and above other Engineering colleges in the region and proves that there is adequate skilled manpower available.

1.17.4 EMCs near Coimbatore

Kanchipuram District and Vellore in Tamil Nadu are already a notified Brownfield clusters. Bangalore and Mysore in Karnataka are also already notified as Brownfield Clusters. There are a total of 5 electronic hardware SEZs being developed around Chennai.



1.17.5 Connectivity to the proposed site at Annur

a) Distance to Major Cities: The major cities close to Annur and the distance and driving time to these are given in table below:‐

City & State Approximate Distance Approximate Driving Time

Coimbatore 30 Kms 45 minutes

Coonoor (TN) 63 Kms 1.5 Hours

Erode (TN) 87 Kms 2 Hours

Salem (TN) 152 Kms 2.5 Hours

Mysore(Karnataka) 182 Kms 3.5 Hours

Kozhikode ( Kerala) 216 Kms 4.5 Hours

Madurai(TN) 223 Kms 4.5 Hours

Cochin ( Kerala) 238 Kms 4.5 Hours

Bangalore(Karnataka) 299 Kms 6 Hours

Hosur (TN) 309 Kms 6 Hours

Pondicherry (TN) 367 Kms 6.5 Hours

Vellore(TN) 378 Kms 6.5 Hours

Mangalore (Karnataka) 437 Kms 8 Hours

Kanchipuram (TN) 444 Kms 7 Hours

Sriperumbudur (TN) 472 Kms 7 Hours

Chennai (TN) 486 Kms 7 Hours

Sri City (AP) 549 Kms 8 Hours

b) Roads & Transportation: Locally the villages are connected through smaller roads and the villagers have access to the site. Annur lies on the junction of three important roads, NH 209 (Coimbatore‐Mysore), Annur ‐ Avinashi road and Annur ‐ Mettupalayam road to north east of Coimbatore city. Bus service is available to Coimbatore City almost once in 10 minutes. It has adequate road links and takes only less than an hour to reach Coimbatore or the nearby towns Avinashi, Mettupalayam, Sathyamangalam, Tirupur etc. Commitment is made by GoTN for widening nearby roads as per of MoU signed with GoTN. c) Railways: The nearest Railway Station to Annur is at Mettupalayam at 22 Kms, but Coimbatore is also close by at 32 Kms. Coimbatore Junction, also known as Coimbatore Main, is the primary railway station serving the metropolis of Coimbatore. It is one of the major rail junctions in South India and the third busiest and revenue yielding railway station in Tamil Nadu after Chennai Central railway station and Chennai Egmore railway station. It is one of the A1 graded station in the Southern Railway. This station comes under the jurisdiction of Salem division of Southern Railways. It is one of the top booking stations in India according to Indian Railways. The trains provide excellent connectivity to Chennai, Bangalore, Cochin, Mumbai and Delhi.



Air Connectivity: As per airport authorities, the annual passenger traffic at Coimbatore (embarking and disembarking) is in the region of 108 million passengers every year with around 40 million embarking, 40 million disembarking and another 28 million by means of transit. Coimbatore has direct flights to all metro cities. It is the 18th largest airport in India in terms of total passenger movement and 13th largest airport in terms of cargo handled. Airlines that fly to Coimbatore are Air India, Jet Lite, Spice Jet, Indigo, Air Arabia and Silk Air. Dedicated Customs set up for Export Cargo, Import Cargo is available and Unaccompanied Baggage clearance is available for six days. A warehouse with one time holding capacity of 100 tons and cold rooms and strong rooms are also available. Though it is an international airport only a few flights are available to Sharjah, though Cargo airlines fly to Sharjah and Bangkok

Name of the Airport Distance from the Airport

Salem 157 Kms

Calicut 170 Kms

Kochi 170 Kms

Tiruchirappalli 206 Kms

Madurai 230 Kms

Bangalore 294 Kms

Chennai 395 Kms

e) Sea Ports: The nearest sea port is at Cochin and is approx. 240 Kms from the site. . The nearest sea ports and distance to the seaports are given in Table below:‐

Port Approximate Distance

Krishanpatnam Port, Nellore, AP 624 Kms

Chennai Port 499 Kms

Mangalore Port 441 Kms

Tuticorin 404 Kms

Cochin Port 240 Kms

1.17.6 Communication

In Coimbatore, VSNL has its international gateway at PSG STEP Software Park in Coimbatore. The Earth station is backed up with a fibre optic cable link to Chennai. VSNL offers both IPLC (International Private Leased Circuit) and Internet both in multiples of 64kbps. STPIs Earth station is also located at Coimbatore at Saravanampatti in the KGISL complex. It also offers both IPLC and Internet leased lines both in multiples of 64 Kbps. Both the earth stations are seamlessly expandable and by virtue of Coimbatore’s locational advantages can get hooked to the wide band width submarine fibre optic cable at Chennai or Kochi for mission critical and delay sensitive applications. With other ISPs having been given license to put up their earth stations or gateways, many of them would be able to provide reliable & redundant connectivity. This will reduce telecom and connectivity costs in Coimbatore. This will also induce companies to set up operations there to take advantage of the cost benefits involved. The current earth station in PSG STEP provides a bandwidth of 14 mbps through optic fibre channels and satellite connectivity to Cochin.



1.17.7 Cost comparison

An analysis by PricewaterhouseCoopers shows the cost comparison of nearby cities with Coimbatore for IT services in a scenario where billing is being done for IT services provided. Table below provides profitability scenarios across cities at billing rates of USD 10/ hr. Coimbatore has a clear advantage when it comes to manpower and real estate costs and is at par only with Cochin. This is indicates that for electronics manufacturing too the manpower and real estate costs would be favourable compared to other cities nearby.

Overheads Chennai Bangalore Hyderabad Cochin Coimbatore

Manpower 26% 27% 26% 21% 20%

Real Estate 8% 9% 5% 3% 3%

Power 1% 2% 1% 1% 1%

Connectivity 2% 2% 2% 1% 1%

Marketing 10% 10% 10% 10% 10%

Miscellaneous 2% 2% 2% 2% 2%

PBDIT 51% 48% 54% 62% 63%



1.17.8 SCOT The strength, opportunity, challenges and threat analysis that emerges out of the above clearly indicates that Coimbatore is a very favourable location to establish an EMC. The proposed location at Annur is just 30 Kms from the heart of the city and is well connected and land has already been procured for the EMC. AnMoU has been signed by AIPL with the Tamil Nadu state government to establish an Industrial park in an area of 1500 acres. The EMC will benefit greatly with synergies with the common facilities available at the Industrial Park too. The SCOT analysis is given in the table below.

Strengths

1) Talented Manpower Availability 2) Enterprising Community 3) Thriving IT, Engineering and

Manufacturing Sector‐design strength combined with expertise in tooling , many foundry and machine shops

4) Synergies with Sriperumbudur and Oragadam and other clusters nearby.

5) Excellent Connectivity by land, air and sea (Cochin Port) and availability of communication facilities.

6) Land Availability 7) Comparative Favourable Costs

(Manpower & Real Estate) 8) Salubrious Climate 9) MoU already signed with the state

Government for setting up and industrial park of 1500 acres in the proposed location.

Opportunities 1) Extension to Electronics manufacturing

focus relatively unexplored. Tremendous scope for automotive electronics (nearly 350 auto component manufacturers in the state, PCBs and Medical Electronics which is a relatively un‐ explored area.

2) Captive Electronics Components/products for local industries

3) Ability to Leverage Design Capabilities

ChallengesManpower may require extensive training.

Threats None Envisaged



CHAPTER 2

PROJECT OBJECTIVES 2.1. Brief Description of the Project

The proposed project envisages developing a model and state of the art EMC; spread over 157.6 acres of land. The project would provide facilities that match world‐class EMCs and would be an ideal place for investors to establish their manufacturing facilities with ease and without hurdles. The SPV will develop the infrastructure facilities and support investors who want to set up individual units within the cluster.

A total of 163 plots of various sizes have been designed for sale as independent or combined units occupying 95+ acres. The Cluster would also endeavour to bring the entire gamut of electronic manufacturing operations under one umbrella and facilitate all stages of the value chain of electronic manufacturing. The project is expected to be completed in a single phase across 18 months from start date. It is expected that the Cluster would house approximately 95 manufacturing units if each such unit is about an acre.

2.2. Development Objectives

a) Local Community: Provide State of the Art Industrial Infrastructure to enhance competitiveness and efficiency of Electronics Manufacturers who are competing globally with manufacturers operating in lower cost economies with highly efficient eco‐systems. High value added manufacturing in electronics sector in India typically suffers 8‐10% cost disability making it difficult for local manufacturers to be competitive in global markets. Further, most electronic products are subject to zero Customs Duty thereby compelling India to import more than 70% of its domestic demand. A key objective of this Cluster is to provide a supportive manufacturing environment, which would reduce manufacturing costs by at least 5%.

b) Attract investments for setting up Manufacturing Units by reputed companies which are looking

to be competitive in the global market. The infrastructure and support services would make the Cluster a preferred location for ESDM Sector.

c) Enable all investing manufacturer members to avail benefits under the various Schemes of

National Policy for Electronics. These include MSIPS, Preferred Market Access (PMA) and encouraging R&D through Venture Funds financed through the Electronic Development Fund (EDF). The Cluster SPV would also provide information and support to enable members to avail benefits under the State Industrial and IT/Electronics Policies. These expert support facilities for obtaining government policy support would strengthen the competitiveness of manufacturers in the Cluster.



d) The development of a large industrial park at Annur, Coimbatore within which the EMC is proposed would create the environment for manufacturing and would help to facilitate mutual growth of electronics and other industries at the same place.

e) The Project aims to create significant employment and investment opportunities. Once fully

established and populated the Cluster expects to employ 16,000+ workers directly and another 30,000 indirectly. This is based on a conservative assumption of average capital investment of Rs. 14 Crores per acre which adds up to about Rs 1300 Crores and an output of Rs. 3,900 Crores at a capital output ratio of 1:3.

f) The Government of Tamil Nadu has attached prime importance to the growth of electronics

industry in the state. The proposed EMC is also in line with the ambitious programme of the state government, which would significantly boost the socio‐economic growth of the region of Coimbatore and Tamil Nadu state in general.

g) The proposed EMC is envisaged as a green campus coupled with smart city concepts, which

would facilitate the establishment of manufacturing units with a view to creating an environmental friendly, sustainable and efficient manufacturing eco‐system.

h) Other key objectives of the Project are to provide Skill Development facilities to develop trained

and efficient manpower for ESDM Sector. A Skill Development Centre would be established which would operate under the guidelines and occupational Standards of the Electronics Sector Skills council.

i) The project has progressive CSR Objectives including providing health and education facilities to

the community living around the project. The CSR activities would also include women’s welfare projects, girl child development activities and low cost or free medical facilities for lower income homes.

Location: The proposed site (approx 157.6 acres area) for the Greenfield EMC is located at AnnurTaluk, Coimbatore District in the state of Tamil Nadu. The site is located near the Town of Annur about 9 Km from NH 209 connecting Coimbatore and Mysore. The exact location is to the West of OthiMalai Road connecting Annur to OthiMalai temple. The site area was procured from the surrounding Vadkkalaur village to the South West, Akkaraisengapally village to the North West and Kuppanur village to the South. The turn to the site on the OthiMalai Road is about 9 Km from Annur and the site lies approximately 1.8 Km to the West from the OthiMalai Road. The site is approximately 38 Km from Coimbatore City and 36 Km from the Coimbatore International Airport (Reference Figure below). Location coordinates (in latitude and longitude) demarcating the proposed EMC area are 11o 18’ 5.4” N / 77o 5’ 11.7” E.



Proposed

Annur

To Coimbatore City

9

OthiMalai

157 Acres

1.8



CHAPTER 3

TARGET BENEFICIARIES

3.1. Key Stake Holders

The key Stakeholders and beneficiaries in the project are:‐ a) Local Community of AnnurTaluk and other areas nearby b) Electronics Industry c) Government of India‐ DeitY d) State of Tamil Nadu e) ELCINA f) ADD Industrial Park ( Tamil Nadu) Ltd and other consortium members g) Financial Investors and Lenders

3.1.1. Local Community:

The maximum benefit of establishing an EMC at Annur will go to local community. The economy of the area primarily depends on textiles spinning. The proposed EMC would generate both direct and indirect employment to the people of the area. Further the allied infrastructure would be required to cater for the proposed EMC and this would enable the overall development of the area. There are CSR activities being planned for the benefit of the local community and allocation has already been made in the project budget. Urban forestry development, drinking water provision, health care educational aids and medical facilities etc will be provided the local community.

3.1.2. Electronics Industry

a) This is a great opportunity for companies investing in the cluster to participate in the several schemes under National Electronics Policy, like MSIPS, PMA etc to offset cost disadvantages faced by these companies. They would also be able to benefit from various state schemes.

b) The cluster is also expected to promote the startup ecosystem in the industry, through venture funds, since the Government has announced a number of implementation policies on Electronics Development Fund.

c) Being part of a large industrial park allows these companies to take not only advantage of common facilities of the park like social infrastructure, convention centre, golf course, knowledge city etc but also find synergies with other sector units investing into the industrial park.



d) A well‐developed cluster can give a unit located in it, a cost advantage because of various reasons such as, increased supply chain responsiveness, consolidation of suppliers, decreased time‐to‐market, superior common infrastructure andlower logistics costs.

e) Assured, good quality and value for money infrastructure & services. f) Hassle free operating environment and a single point interface for all infrastructure &

services. g) Synergies from co‐opting companies within EMC.

3.1.3. Government of India‐ DeitY: If India achieves 25‐30% annual growth in electronics production

over the 12th Plan period, it will create millions of direct and indirect employment opportunities, contribute to meeting inclusive growth objectives, Reduce Foreign Exchange outgo and add to government revenues while improving the quality of life and empowerment of our people:‐

a) Supports the NPE vision and strategy of setting up 200 clusters. b) Help reduce fiscal deficit as the EMC will contribute to narrowing the gap between

domestic demand and production. c) Possible FDI & increase in Local investments. d) Social Benefits in terms of development of the area and employment generation

3.1.4. State of Tamil Nadu: TheCoimbatore Cluster will benefit Tamil Nadu in that:‐

a) This further strengthens the States initiative on Electronics manufacturing. b) This cluster is an electronics manufacturing gateway to Bangalore and Cochin due to its

proximity to these cities and is likely to attract investments from outside the state as well.

c) This would assist in development of the local area. d) This would generate employment and up‐skill a fair portion of the local working

population.

3.1.5. ELCINA

a) This cluster is yet another feather in ELCINA’s cap and a significant milestone in realizing ELCINA’s Cluster Vision.

b) ELCINA represents the industry and would be in a position to facilitate further investments in the sector.

c) Being able to develop and promote a number of clusters will enhance the credibility of ELCINA and will enable it to represents the Indian Electronics Industry more strongly on various platforms including Department of Electronics & IT (DeitY) Government of India.

3.1.6. ADD Industrial Park ( Tamil Nadu) Ltd and other Consortium members

a) Recovery of investment in the land acquired which is being transferred to the SPV.



b) Participate in the potential benefits of EMC through equity stake (either through equity or premium for the land).

c) Enable these companies to contribute to the development of Annur region. d) Positions these companies as a significant players contributing to the national strategy

to boost electronics manufacturing and infrastructure development. e) Participate in Nation Building.

3.1.7. Financial Investors and Lenders

a) Reduces the risks in the project through commitment from DeitY& Government of TN. b) Bankable revenue streams and adequate cove. c) Credit enhancing mechanisms. d) Reducing the execution risk by selecting investors with a good track record.

3.2. Employment Generation

Employment Generation: At 163 saleable plots of approx ½ acres each and at an average of 100 employees per unit of ½ acre, 16300 direct jobs are estimated to be created. Indirect jobs in the electronics industry can be thumb ruled at about 2 times the direct employment. The total employment generated is expected to be 48900 jobs.

Employment Generated Per ½ acre Assumption Total Direct Jobs 100 16300 Indirect Jobs 200 32600

3.3. Total Expected Investments by Units The EMC has 163 saleable units of 1/2 acre each for sale in an area of 95 acres. In an acre it is possible to set up an unit and the total cost of machinery for a full manufacturing line ( including 30000CPH SMT line) would be USD 3 Million ( Rs 19 Croresapprox). Including land and building the total cost would be around Rs 22 Crores for a full‐fledged manufacturing unit. It is possible that some units would build vertically and include more SMT lines and other P&M. However all units are not likely to set up a complete manufacturing line as some are going to be supporting manufacturing units and some supporting services. The following is assumed.

Item description No of Units Investment/Unit Total Investment /INR Crores

Full Line Manufacturing Units 30 22 660

Support manufacturing Units 45 12 540

Supporting Services 20 8 160

Total 95 1360



CHAPTER 4

PROJECT COMPONENTS

4.1. Broad project outline:

A Greenfield EMC (Electronics Manufacturing Cluster) is proposed to be developed on an area of 157.6 acresatAnnurtaluk, Coimbatore District in the state of Tamil Nadu. The main objective of the project is to provide a state‐of‐the‐art manufacturing facility for electronics industry with support from Government of India under the Electronics Manufacturing Cluster (EMC) Scheme of the National Policy on Electronics 2012. The EMC shall have world class facilities and utilities akin to a SMART CITY in order to facilitate efficient manufacturing. The project mainly comprises of saleable industrial plots of approximately 2000sqm each, which can be combined to form larger plots as per the requirement of the manufacturer. Strong emphasis has been provided on easy accessibility, efficient transport network, greenery, worker welfare services and recreational services within the project to attract manufacturers. GREEN INITIATIVES like “Zero‐Discharge” campus, solar lighting, storm water recharge through a natural water reservoir, design suiting the natural land contours, energy efficient electrical distribution system make this campus a very attractive and sustainable manufacturing destination. Broad outline of the project components is: PLOT AREA = 157.6acres = 637852sqm. a) Industrial Plots saleable (163 Nos.)= 385714sqm. = 60.5% of the total plot area. b) Services Areas = 12537sqm = 2% of the total plot area. c) Roads = 116232sqm. = 18.2% of the total plot area. d) Parking / Truck holding area = 21099sqm= 3.3% of the total plot area. e) Common Amenity Buildings = 37755sqm with built up area of 16750sqm = 5.9% plot area of

the total plot area. f) Green area = 64515sqm= 10.1% of the total plot area.

4.2. Masterplan: Planning concept

The total site area is 157.6 acres and the entire area is proposed for setting up of the Electronics Manufacturing Cluster. The Master planning is aimed at optimising the layout of the industrial plots, planning of infrastructure (utilities and amenities) and determining the inter and intra circulation after incorporating the detailed analysis of the site, assessment of immediate

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Page 5

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collects water from various parts of the site and joins the reservoir. This is achieved by carefully planning the layout as per the natural contours of the site.

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energy efficient, sustainable and pragmatic network within the cluster. The site is serviced by three substations & three water works area to achieve an efficient network. Solar Streetlights have been planned along the roads in the entire campus along with underground water supply lines, storm water drainage, sewage network, communication network, electricity distribution lines. Sewage Treatment Plants (STPs) at three different locations have been planned within the cluster to optimise the sewage system.

f) Flexibility:The planning of the Park has been kept flexible so as to be adaptive to the rapidly evolving business landscape. The Master Plan allows programmed or functional re‐arrangement and re‐distribution of plot sizes, infrastructure network and open space distribution enabling the units to have plots of variable sizes with a provision of future expansion. The typical plot size is approximately 2000sqm, but the design offers the flexibility to combine plots as per the needs of the manufacturer.

g) Compliance: The Master Plan also complies with the guidelines issued by Department of Town and Country Planning, GoTNandthe Ministry of Environment, Forests and Climate Change (MEFCC), Government of India (GoI).Provisions of the National Building Code and prudent engineering practices have been followed in preparing the Master Plan. The Master Plan follows the zoning concept for meeting the statutory norms of planning, to minimise the impact of pollution, if any, on the resident population in and around the Park and to attain the economics of design by consolidating scarce and costly resources for shared access.

4.3.Final Masterplan

The detailed master planalong with the entire architectural features is attached as Annexure 1 (Architecture Design Report).

4.4. Project components:

The cluster has been envisaged as a self‐sustainable and efficient manufacturing hub complete with all modern amenities and a green and clean environment conducive for electronic manufacturing. The key components of the EMC are listed below:

OUTLINE AREA CHART

S. No.

Particulars UnitPlot Area

Building Area

% Area % Area

sqm sqm Processing Non‐

Processing

TOTAL PLOT AREA (157.6 ACRES) sqm 637852

1 INDUSTRIAL PLOTS ‐ Total 163 plots sqm 385714 60.5

2

SERVICES AREA: ESSENTIAL SERVICES ‐ Electric / water works / recharge water body & other services for servicing the industrial plots.

sqm 12537 1250 2.0

a Electrical Network: Sub‐station‐1, 2 & 3. sqm 8337 500.0

b Plumbing Network ‐ STP, WTP, Pumpingsystem.

sqm 4200 750.0

3 ROADS: BASIC DEVELOPMENT ‐ Area under roads and truck handling parking area for connecting industrial plots.

sqm 116232 18.2

4 TRUCK HOLDING (PARKING) ‐Area under truck handling / parking area.

sqm 21099 3.3

5 COMMON AMENITIES: MANUFACTURING SUPPORT & WELFARE SERVICES

sqm 37755 15500 2.5 3.4

Building‐1: Gatehouse sqm 1573 750 0.2

Building‐2 : Support Services: Admin & Training Building

sqm 5936 3500 0.9

Building‐3 : Manufacturing support building

sqm 2964 2200 0.5

Building‐4: Employee hostel & mess sqm 4097 3000 0.6

Building‐5: Clubhouse sqm 4392 1500 0.7

Building‐6a, 6b & 6c: Worker welfare sqm 2829 2550 0.4

Building‐7: Ware house sqm 5746 1400 0.9

Building‐8: Medical centre sqm 3025 600 0.5

Building‐9: Community Hall sqm 3596 future 0.6

Building‐10: Shopping Complex sqm 3596 future 0.6



GREEN AREA ‐Total area under landscaping / Greenery

sqm 64515 10.1

TOTAL 637852 16750 86.5 13.5

4.4.1 Industrial plots: A total of 163 plots have been planned for setting up of manufacturing units by the SPV. The typical size of the plots is approximately 2000sqm and they can be combined to set up larger manufacturing facilities. The total saleable area under these plots is 385714sqm. Each plot would be connected by the road network along with all the services like electric connection, sewer connection, central STP, treated water supply & storm water drainage. Further, each manufacturing unit can use the common amenities being provided in the cluster. The entire campus is a secured gated campus.

4.4.2 Services area: Essential services

All modern services have been planned for the project.

a. Electrical network: All electrical power requirements, communication, security systems are brought under this category. The maximum electrical demand load of the complex is worked out as 30 MW. Each manufacturing unit of approximately 2000sqm size shall be provided with a 150 KW electric load supply. TheTamil Nadu Electricity Board (TNEB) will provide power at 110 KV, 3 Phase, 50 Hz connection. This will be connected to a Gas Insulated Switchgear (GIS) and subsequently to 3 outgoing power transformers of 10 MVA (5x2 MVA) each. From here onwards, a 33 kV supply line will be taken through an underground cable (UGC) to the three 33 kV/11 kV substations. Power shall be received through a Ring Main Unit (RMU) via metering at the substation of the complex. Each manufacturing unit will be supplied power through individual cable from the 11 kV substations as per the respective load required. The detailed electrical description and the design calculations are mentioned in the Annexure 2: Electrical design report.

b. Plumbing network: The campus has been planned as a ZERO‐DISCHARGE self‐sustainable campus. The campus shall provide uninterrupted treated water to all the manufacturing units and common amenities. The campus shall receive water from the GoTN appointed agency as well as back‐up water supply from the bore wells plannedwithin the cluster. 7200 KLD is the total water requirement of the campus, which is met through 2400 KLD fresh water & 4800 KLD STP water recirculation. The entire campus is divided into three zones with their own water treatment plant (WTP) and pump house for water supply. The drainage network is very elaborate with separate sewer and storm



water drainage connecting all the units. All three zones will have their individual 1800 KLD STP units. Thus, a total of 5400 KLD capacity STP shall be set up. Total STP water generated is 4800KLD & STP water utilised is 4800KLD. Thus, we achieve a ZERO discharge industrial park. The detailed distribution description and design calculations are mentioned in the Annexure 3: Plumbing design report.

4.4.3 Roads: Basic development

Bitumen surface roads as per the Ministry of Road Transport & Highways (MoRTH) specifications with footpaths and green area have been planned for the entire campus. A total of approximately 7 Km length of roads shall be laid, which shall consist of 30m wide road (350m) at the entrance; 18m wide road (1750m) as the main ridge road; 15m wide road (400m) with the central storm water channel & 13m wide road (4300m) servicing the plots. All road sections have been carefully planned to maximise accessibility and provide aesthetic value to the campus by incorporating water channels, footpaths, street lighting, service ducts & greenery. The natural slope of the original land has been maintained to a large extent in designing the roads. A typical section through the road is as follows:

Owing to the naturally sloping terrain, there shall be basic land development required for cutting & filling the land in order to develop terraces to suit the master plan. The cost of basic land development, which includes the cutting / filling of land to establish the suitable gradient and terracing of the land has not been included in the detailed cost estimate as per the requirement of DeitY. This cost has been factored in the land cost, which is not considered for the purpose of evaluation.

4.4.4 Truck holding area:



Proper care has been taken to plan the truck holding areas for the parking of trucks. An area of approximately 21100sqm is planned as a bitumen surface for this purpose. Worker welfare buildings are also planned adjacent to the truck holding areas.

4.4.5 Common amenities:

Efficient and functional common amenity buildings are proposed to facilitate the manufacturing units as prescribed in the DeitY guidelines. The detailed description & layout of all the buildings are depicted in the Annexure 1: Architecture Design Report. The common amenity buildings are as follows:

Building‐1: Gatehouse: Government regulatory services building: The building shall be the entry point of the cluster campus and shall house the time office, security personnel and government support office. It shall be a 2 floor building comprising of a signature gate signifying an institutional entrance to the campus. It is planned on a 1573 sqm plot with a built up area of 750 sqm at an estimated cost of approximately Rs. 2.70 Crores. Building‐2: Support services: Admin & Training building: This building is the heart of the campus and showcases the cluster. It is planned as an institutional building consisting of a grand reception area and a cluster administration office. There shall be a business centre with a 200 seat auditorium, 2 Nos. of 30 seat conference rooms with video conference facility and an office space, which can be used by the manufacturers. The building shall also house 2 training rooms for 40 people each for conducting industry specific skill training programs for the employees of the manufacturing companies. The maintenance office along with a store and IT / telecommunication hub shall also be planned in this building. It is planned on a 5936 sqm plot with a built up area of 3500 sqm at an estimated cost of approximately Rs. 10.2 Crores. Building‐3: Manufacturing support building: This building shall house the central manufacturing support facilities for the aid of the manufacturers. It is a 2 floor building with space for testing / certification, tool room, CAD design, R&D centre as per the needs of the cluster. Some basic testing machines shall be placed in this building so that the manufacturers do not have to invest in setting up such cost intensive facilities in their units. This building is planned on a 2964 sqm plot with a built up area of 2200 sqm at an estimated cost of approximately Rs. 5.05 Crores. Building‐4: Employee hostel& mess: Welfare services: This is a facility provided for temporary stay of employees / guests within the cluster. It has a common dining area, multipurpose hall and gaming area along with accommodation for 103 guests consisting of 11 single rooms, 11 double rooms and 14 five‐bed dormitories. It is a 5 storey building



planned on a 4097sqm plot with a built up area of 3000 sqm at an estimated cost of approximately Rs. 10.50 Crores. Building‐5: Clubhouse: Welfare services: This is the recreational building planned for the employees of the cluster, which consists of a restaurant, swimming pool, gaming area & multipurpose hall. It is a 2 storey building planned on a 4392 sqm plot with a built up area of 1500 sqm at an estimated cost of approximately Rs. 4.40 Crores. Building‐6a, 6b & 6c: Worker welfare buildings (3 Nos.): Welfare services: This building has been proposed at 3 locations within the campus and houses the basic welfare amenities for the workers in the cluster. Each building will have a convenience shop, ATM, creche, first aid centre, cafeteria and a worker orientation space. There shall be 3 buildings of 850 sqm built‐up area each at 3 locations within the cluster at an estimated total cost of approximately Rs. 4.77 Crores. Building‐7: Warehouse: Essential services: A central warehouse has been planned for the benefit of the manufacturers. It is a single storey prefab shed building with loading / unloading dock planned on a 5746 sqm plot with 1400 sqm

built‐up area at an estimated cost of approximately Rs. 3 Crores. Building‐8: Medical Centre: Hospital & ESIC building: A basic medical centre with first aid and preliminary medical facility, emergency ward and chambers for doctors have been proposed. It is a single storey building planned on a 3025 sqm plot

with 600 sqm built up area at an estimated cost of approximately Rs. 2.30 Crores. Building‐9: Community Hall building: Welfare services: A 3596 sqm plot has been reserved for the development of a community hall building in future. It has been planned near the water reservoir so that it becomes a recreational area.

Building‐10: Local Shopping Centre building: Welfare Services:

A 3596 sqm plot has been reserved for the development of a local shopping centre building in future. It has been planned near the water reservoir so that it becomes a recreational area.

4.4.6 Green Area



Green areas are the lifeline of any development and enable a healthy, clean environment within the cluster. The location of the green areas has been planned very strategically so that they are easily accessible from all parts of the cluster. The site has two elevated points, which have been reserved for natural landscaped green areas to enable uninterrupted views of the entire campus. The main ridge road has a continuous green belt on either side along with other scattered green areas located in the campus.

4.5. “GREEN” campus features:

The design ideology of the cluster has been evolved with a keen thrust of incorporating GREEN technologies. We plan to get a GREEN CERTIFICATION RATING for the project so that we can attract the best manufacturers in the industry.

The key features incorporated in the project are: 4.5.1. Site selection & planning: The entire campus has been planned keeping in view the

natural contours of the land so as to be least invasive. The natural slopes are used for water drainage and a reservoir is planned at the lowest point to recharge groundwater. The natural features are retained as much as possible. Electrical distribution is planned so as to minimise the distribution losses.

4.5.2. Health & well‐being:A green campus results in happy, committed and efficient working

professionals. The central ridge provides a peaceful, calm and green getaway from the hectic activity in the industrial plots. The ridge has all the common amenities and is flanked by the two natural green high points providing beautiful vistas of the campus. The entire campus shall be a tobacco free campus. Noise levels shall be kept in control by careful planning of accessibility and transport routes, segregated truck handling areas interspersed with green belts and trees.

4.5.3 Building planning & construction: The emphasis has been on sensitive building design &

construction. All local and low energy consuming materials with high recycle value content shall be used in the construction. Solar streetlights have been used in the campus to demonstrate the commitment to alternate renewable energy. The planning compliance with all national & international standards has been done in order to create a truly holistic manufacturing campus.

4.5.4 Recycle, reuse & recharge: zero discharge campus:The entire campus pledges not to

discharge any waste water. Rather the entire waste water produced is processed through the central STP and then consumed entirely within the system, thus, achieving a ZERO DISCHARGE CAMPUS. Total STP water generated is 4800KLD & STP water utilised is 4800KLD.



4.5.5 Building operation & maintenance:Since Green buildings have energy efficient and effective building solutions, the operation and maintenance is both cost effective and simple. All systems are self‐sustainable with a very low payback period.

4.5.6 Benefits of green buildings:The project will reap both tangible and intangible benefits by

going for a “green” campus, such as:

Reduced operating cost Enhanced productivity of occupants Green Corporate image Demonstration of the commitment to Green in order to attract international investment into the campus.



CHAPTER 5

SUPPORT INFRASTRUCTURE

The proposed Electronics Manufacturing Cluster (EMC) shall have the most advanced electrical, plumbing (water supply, drainage, sewerage), security & communications network in order to facilitate a hassle free manufacturing campus. It is envisaged that all the infrastructure services shall be laid below ground along with the road network so that they are not visible and also easily serviceable since they do not cross any private territory. A schematic layout of the services is as follows:

5.1.Water Requirement:

The water requirement for the campus has been worked out considering that 5L/sqm (assuming 50 litres per person consumption & 200 people shall be employed on a 2000 sqm plot) domestic water consumption & 10L/sqm for the process water requirement. The total industrial requirement for the manufacturing units is estimated to be 5786KLD, out of which 3729KLD will besupplied by STP and the balance 2057KLD shall be fresh water. The total domestic requirement of water for Common Amenities, Roads, Park& External Areas is estimated as 1350KLD, out of which 1030KLD will be supplied by the Sewage Treatment Plant (STP) and balance 320KLD shall be fresh water. The plumbing design report is attached as Annexure 3. The source of fresh water will be from the New Tiruppur Area Development Corporation Limited (NTADCL) where adequate water is available for which action has been initiated by AEEPPL based on the MoU signed between AIPL (the Chief Promoter) and GoTN for the development of industrial park at Annur, Coimbatore within which the EMC is proposed to be established. A copy of MoU is attached as Annexure 4. A copy of the communication received from NTADCL confirming the supply of water for



the industrial park, which houses the EMC is attached as Annexure 5 (a). In the meantime, the President, KuppanurPanchayat (which is the authority concerned) has issued a No Objection Certificate (NOC)for drawing water from the existing and new bore wells proposed within the EMC, a copy of which is shown as Annexure 5 (b).

5.2. Electricity Requirement:

The total electrical power requirement for the EMC is estimated as 30 MW, which is proposed to be met by establishing 3 substations each consisting of 2 Nos. of 5MVA transformers each. Each unit shall be provided with a 150 kW electric load supply. TheTamil Nadu Electricity Board (TNEB) will provide power at 110 kV, 3 Phase, 50 Hz connection. The power from the grid will be at 110 kV, which will be connected to a Gas Insulated Switchgear (GIS) and subsequently to 3 outgoing power transformers of 10 MVA (5x2 MVA) each. From here onwards 33 kV supply line will be taken through an underground cable (UGC) to 33 kV/11 kV 3 Nos. substations. Supply shall be received through a Ring Main Unit (R.M.U) via metering at the substation of the EMC. From 11 kV substations each unit will be supplied with individual cable as per the load required.

The total power required for common area (i.e. non‐processing area) is 1605 kW demand, which is shown in the table below. The power requirement for processing area is shown in the report on the electrical system design, which is attached as Annexure 2.



ITEM Substation1

(Connected load in kW)

Substation 2 (Connected load in

kW)

Substation 3 (Connected load in

kW)

Transformers 2 No 5 MVA 2 No 5 MVA 2 No 5 MVA

Welfare Building (6a)(Approximately) 70 70 70

Gatehouse (Approximately) 50

Administrative Building (Approximately) 237

Hostel (Approximately) 168

Ware House (Approximately) 80

Medical Centre (Approximately) 60

Plumbing (Approximately) 200 200 200

Community Hall (Approximately) 100

Shopping Complex (Approximately) 100

Common Area (Approximately) 865 470 270

Total for Common Areas (non – processing area) 1595



Based on the MoU signed between AIPL (the Chief Promoter) and GoTN for the development of industrial park at Annur, Coimbatore within which the EMC is proposed to be established, the Tamil Nadu Electricity Board (TNEB) has been requested for supplying the required power for the EMC. The matter is being processed by TNEB, GoTN. The copy of the application submitted to TNEB in this regard isattached herewith as Annexures 6.

5.3: Security & Communications Network

Security considerations are paramount in the campus. The entire campus is a secured, gated campus to ensure the security of every individual. All areas shall be adequately lit and the access points duly manned by security personnel. Smoke / heat detection system is provided in all buildings. Communication systems are the backbone of any manufacturing cluster. All the leading telecommunication brands have expressed their interest in setting up their network. As part of our infrastructure we shall be laying an Optic Fibre Communication network in the entire campus. Kindly refer to Annexure 2: Electric Design report for the detailed report on the electric network.



CHAPTER 6

ENVIRONMENTAL IMPACT ASSESSMENT

6.1 Introduction

The campus is proposed to be a sustainable and “green” campus with all state‐of‐art facilities. The environmental impact assessment (EIA) is extremely important to minimise the impact of industrial development on the environment. Apart from being a mandatory approval required for the EMC, the EIA will help in developing a sustainable cluster. The summary of the project is as per the table below:

Proposed project Greenfield Electronic Manufacturing Cluster

Category 8(b), “B2”

Project location Kuppanur village Survey No. 70, 71, 72, 207, 208, 209, 210/1A, 210/1B, 210/2, 239, 240,

241, 242, 243, 244, 313 Akkaraisengapalli village Survey No. 556, 558, 559, 560, 561, 562, 563, 564, 565/2, 567/3 Vadkalur village Survey No. 304, 313/2, 314 AnnurTaluk, Coimbatore district, Tamil Nadu

Total plot area Land area:‐ 63.79 Ha / 157.6 Acre

Total built‐up area 21,169 sq. M

Environmental setting Site co‐ordinates

Latitude Latitude

11o19.087’N 77o3.671’N

11o18.713’N 77o3.781’N

11o18.632’N 77o4.359’N

11o18.214’N 77o4.875’N

11o18.131’N 77o5.113’N

11o18.178’N 77o5.601’N

11o16.975’N 77o5.671’N

Elevation 394 m AMSL



River

R.Bhavani 5.21 Km, West

Waterbodies

Annur Lake 5.0 Km, SE

Vadkalur Lake 1.8 Km, SE

MasakkaananKuttai 3.0 Km, SE

Reservoir

BhavaniSagar reservoir 9.6 Km, NNW

Reserve Forests

Odunthurai R.F 9.0 Km, WNW

MedurPethikuttai Forest 5.4 Km, NNW

Mountain Mount Sirumugai 2.1 Km, North Mount Othimalai 6.13 Km, North

Densely populated area Annur 5.66 Km, SSE Nearest major habitation Mannur ‐ 0.2 Km, West. Proposed facilities Electronic Manufacturing Cluster Total occupancy 6379 Persons (Including visitors) Parking details 21,099 Sqr. Mtrs. Water requirement Total water requirement 72,00 KLD

Total fresh water requirement 24,00 KLD Source of fresh water: New Tiruppur Area Development Corporation Limited (NTADCL) and bore well / tube well

Treated water from STP – 48,00 KLD

Water supply Source New Tiruppur Area Development Corporation Limited& bore well / tube well

Sanitation details Proposed sewage treatment plant (STP) capacity of 54,00 KLD.



Solid‐waste management The solid wastes will be collected and segregated. Thebiodegradable&non‐biodegradable waste will be given to authorized recyclers.

Power requirement Power demand: 30 MW

Source: TANGEDCO will be supplying the power through the nearest TNEB substation for which the MoU has been signed with GoTN

Emergency Back‐up DG Sets ‐ Used for Common areas, External lighting and Lifts. Fuel Requirement: Ultrapure low sulphur content diesel

Back‐up:

DG Set 2 Nos. Of 500 kVA; 2 Nos. of 200 kVA; 3 Nos. of 100 kVA and 1 No. of 82.5 kVA.

LS‐Diesel‐ 100 Litres/Hr

Individual lessee will be managing their power back up facility based upon their requirements

Air Pollution/Noisegeneration Sources

DG Sets will be provided with stack height of 3m above thebuilding height. Also provided with suitable acoustic enclosurestominimize noise.

Total investment of the project/activity

Estimated total project cost for infrastructure development under thisproject is Rs. 196/‐ Crores

Funds allocated for EMP Capital cost: Rs. 195 Lakhs Recurring cost: Rs. 56.5 Lakhs/Annum Name of the Environmental Consultant involved

M/s. VIMTA LABS LIMITED Branch office: No. 8 – Azad Road R. S. Puram, Coimbatore – 641002

Regd. office: 142, IDA, Phase‐II, Cherlapally, Hyderabad‐500 051 QCI/NABET Accredited EIA Consultancy Organization, NABL Accredited, ISO 17025 Certified and MoEF Recognized Laboratory



LANDUSE SPLIT‐UP

Sl. No.

Land Use

Area

(in Sqr.Mtr)

Area (ha) Area (%) Usage Type

1 Industrial Plots 385714 38.57 60.5 Processing area

2 Services Area 12536 1.25 2 Processing area

3 Roads 116232 11.62 18.2 Processing area

4 Parking Area 21099 2.11 3.3 Processing area

5

Common amenities 37755 3.78 5.9

Processing area (2.5) + Non processing area (3.4)

6 Greenbelt 64516 6.45 10.1 Non‐processing area

Total 637852 63.79 100

Kuppanur Village SF.No. 70, 71, 72, 207, 208, 209, 210/1A, 210/1B, 210/2, 239, 240, 241, 242, 243, 244, 313

Akkaraisengapalli village SF.No. 556, 558, 559, 560, 561, 562, 563, 564, 565/2, 567/3

Vadkalur Village SF.No. 304, 313/2, 314

AnnurTaluk, Coimbatore district, Tamil Nadu

I. Water and wastewater management

The total water required for the project is 7,200 KLD. The fresh water requirement of (2,400 KLD) will be met from New Tiruppur Area Development Corporation Limited / Bore well and 4,800 KLD from STP as treated water.

The total wastewater generation of the area development will be about 5,323 KLD. The generated wastewater will be treated in the STP (90% efficiency) of 5400 KLD and the treated wastewater will be utilized for process, domestic requirement and in common amenities

Surface run‐off collected from the terrace floor run‐off will be diverted to the rainwater recharging structures.

II. Greenbelt / landscaping

The project will be developed with 6.45 ha green cover. In the upcoming future developments more green belt area will be developed covering 35% of the total area.



III. Solid waste management

The total waste generated from the entire project amounts to around 0.32 TPD. Out of which biodegradable will be about 0.19 TPD (i.e. 60%) and non‐biodegradable will be about 0.13 TPD (i.e. 40%). The solid wastes will be collected and segregated. The biodegradable & non‐biodegradable waste will be given to authorized recyclers. STP sludge generated from the STP will be used as manure for garden.

SOLID WASTE GENERATION DETAILS

Sl. No.

Source No. of Persons

Per capita Considered (in TPD)

Total Solid Waste (TPD)

1 General Garbage

Industrial Plots 6379 0.05 0.32

Total Garbage

2 STP sludge ‐‐‐ ‐‐‐ 0.88

SOLID WASTE MANAGEMENT

Sl. No.

Description of waste

Quantity

Mode ofCollection

Mode of Disposal Organic (60%)

Inorganic (40%)

1 General Garbage 0.19 TPD Manual Authorized waste collectors

0.13 TPD Manual

2 STP sludge 0.88 Manual On own land for Gardening

IV. Fire safety measures adopted

Firefighting system to the Industrial plots is designed based on the recommendations of NBC 2005. Following safety measures are envisaged.

o An exclusive UG Sump at the ground level & OHT on the stair case core of each block at

the terrace level will be adopted.

o An electrical driven fire pump and one diesel pump shall be provided.



o One no. of Sprinkler pump exclusively for sprinkler system.

o One no. of wet riser will be provided.

o FHC is envisaged with hydrant valve and hose reel at each staircase landing level.

o Separate pump riser & distribution network is proposed for sprinkler system.

o Portable fire extinguishers are proposed to be placed at strategic locations.

o Fire brigade inlet connection for external pumping arrangement is envisaged

o A yard hydrant of building peripheral length is provided

o Installation control valve is envisaged for sprinkler system

o Automatic sprinkler system is envisaged for entire building

The above safety requirements are same for all the blocks 6.2 Indicative environmental & social impact 6.2.1 Environmental impact: The environmental impacts due to the development of the EMC are pre‐dominantly likely to be in term of air, water and noise pollution. However no major impact is expected during construction and operational stage. The operating units will have to obtain pollution control clearance from state authorities at an individual level and adhere to the norms laid down by the authorities. Necessary control measures will be undertaken at the design stage to meet the statutory requirements and towards minimizing environmental impacts.

6.2.2 Air quality during Construction: Cutting and levelling activity would be required for providing roads, sewage network, storm water system, administrative buildings for proposed project. The potential source of air quality impact arising from the establishment/construction of the proposed project is fugitive dust generation. The dust, measurable as Particulate Matter (PM<2.5μ, PM 10μ), Sulphur dioxide (SO2) oxides of nitrogen (NOx), would be generated as a result of construction activities. During construction, the existing houses nearby may be subjected to the potential dust impacts. The potential dust sources associated with the constructional activities are loading and unloading of the materials, top soil removal, vehicular movement over unpaved roads, and wind erosion, etc. The possible constructional activities that contribute to the environmental impacts broadly given below:

a) Dust Generation during leveling of earth b) Dust generation due to the movement of vehicles on unpaved roads c) Emission of pollutants from vehicular exhaust d) Unloading of raw materials and removal of unwanted waste material e) Accumulation of excavated earth material



6.2.3 Air quality mitigation measures: For the proposed development, levelling and grading will be carried

out; where ever possible the natural elevations will be maintained and not be disturbed. Levelling activity will be carried out for providing roads, sewage network, storm water system, and places required for providing buildings for administrative, production/manufacturing plant and other utility erections. According to the engineering assessment; most of the excavated material shall be reused within the proposed development. Most of the construction dust will be generated by the movement of carrying vehicles on unpaved roads. Unloading and loading of constructional materials shall also act as a potential source for dust nuisance. Given the implementation of proper control measures for dust suppression, no adverse impacts are expected. The control measures proposed to be taken up are given below:‐

a) Water sprinkling on main haul roads in the proposed development will be done, this

activity will be carried out at least twice a day, if need arises frequency will be increased on windy days, in this way around 50% reduction on the dust contribution from the exposed surface will be achieved.

b) The duration of stockpiling will be as short as possible as most of the material will be used as backfill material for the open cut trenches for road development.

c) Temporary tin sheets of sufficient height (3m) will be erected around the proposed site for the development of as barrier for dust control.

d) Tree plantations around the boundary will be initiated at the early stages by plantation of 2 to 3 years old samplings using drip irrigation so that the area will be moist for most part of the day.

e) All the vehicles carrying raw materials will be covered with tarpaulin / plastic sheet, unloading and loading activity will be stopped during windy period.

f) To reduce the dust movement from civil construction site to the neighborhood the external part of the building will be covered by plastic sheets.

g) During Operation DG set stacks and other process emissions are passed through appropriated air pollution control units/treatment systems and vented through stack meeting the TNSPCB standards



6.2.4 Water quality mitigation measures: During the development necessary precautions will be taken, so that the runoff water from the proposed site gets collected to working pit and if any over flow is, will be diverted to nearby greenbelt / plantation area. At the time of construction in the proposed development, all the equipments washed water will be diverted to working pit to arrest the suspended solids if any and the settled water will be reused for constructional purposes, and for sprinkling on roads to control the dust emission, etc. The waste generated from the proposed project site work , will be segregated like used oil, lubricants, etc and disposed to authorized recyclers the waste like soiled cotton, paper, etc will be disposed to municipal bins or sold out to the authorized agencies. The domestic wastewater generated from temporary toilets used by the work force will be treated through sewage treatment plant and reused. Therefore, impact on water qualitydue to the proposed development would be insignificant.

6.2.5 Noise mitigation measures: Noise generating equipment will be used during day time during brief

period of its requirement. Proper enclosures will be used for reduction in noise levels, where ever possible the noise generation equipment will be kept away from human habitation. Temporary tin sheets of sufficient height will be erected around the noise generating activity or all around the area of construction as a barrier for noise travelling outside construction area. Therefore, impact of noise on environment would be considerably insignificant. All vehicles entering the site would adhere to proposed speed limits and not blow horns unless absolutely necessary. Personal protective equipment like ear muffs helmets covering ears will be provided to the workers and it will be ensured that the workers wear them regularly.

6.2.6 Solid waste mitigation measures: The solid waste generated during constructional period being

predominantly inert in nature, construction and demolition waste does not create any chemical or biochemical pollution. However maximum effort would be made to reduce, reuse and recycle them. Most of the solid waste material will be used for filing/ levelling of low‐lying areas. All attempts will be made to stick to the following measures:‐

a) All construction waste shall be stored within the proposed site itself. A proper screen will be

provided so that the waste does not get scattered. b) Attempts will be made to keep the waste segregated into different heaps as far as possible so

that their further gradation and reuse is facilitated. c) Materials, which can be reused for purpose of construction, leveling, making roads/ pavement

will also be kept in separate heaps from those which are to be sold or land filled. d) The local body or a private company may be arranged to provide appropriate number of skip

containers/ trolleys on hire.

The use of the construction material basically depends on their separation and conditions of the separated material. A majority of these materials are durable and therefore, have a high potential for reuse. It would, however, be desirable to have quality standards for the recycled materials. Construction waste can be used in the following manner: a) Reuse of bricks, tiles, stone slabs, timber, piping railings etc. to the extent possible and

depending upon their conditions.



b) Sale/ auction of materials which cannot be used at the proposed due to design constraint. c) Plastics, broken glass, scrap metal, used cement bags; etc can be sold out to the authorized

agencies. d) Rubble/ brick bats can be used for building activity, such as leveling, under coat of lanes where

the traffic does not constitute heavy moving loads. e) Larger unusable pieces can be sent for filing up low lying areas. f) Fine material such as sand, dust, etc can be used as cover material g) The unearthed soil can be used for leveling as well as for lawn development h) The broken pieces of the flooring material can be used for leveling in the building or can be

disposed off i) The unused or remaining paints/varnishes/wood can either be reused or can be disposed off to

the authorized agencies. 6.2.7 Ecological aspects: No major vegetation is present and hence there will not be any negative impact

on the existing plantation. However, the proponent is going for plantation along the boundary during construction activity. A comprehensive green belt programme will improve the ecological condition of the region.

6.2.8 Site security: Adequate security arrangement would be made to ensure that the local inhabitants and

the stray cattle are not exposed to the potential hazards of construction activities. 6.2.9 E‐waste disposal: E waste would be disposed off through a third party authorised vendor. Provision

for storage of e waste may be made in the warehouse. 6.2.10 STP: Common Sewage Treatment Plants (STP) has been conceptualized and recommended for

effective treatment and disposal of wastes water from the proposed development. 6.2.11 Social impact: The proposed area is devoid of any major habitation. Despite that there will positive

impacts on the socio – economic status of the surrounding areas

a) More employment opportunities will be generated b) Physical infrastructure development such as improvement to roads, UGD lines, street lights etc will take place

6.2.11 Environmental clearance: A detailed EIA has been prepared by expert consultants and submitted to

the authorities for clearance. The application/acknowledgement from the authorities is attached as Annexure 7.



6.3. Conclusion

The establishment of the Electronic Manufacturing Cluster by M/s. ADD‐ELCINAElectronics Park Private Limited at Kuppanur, Akkaraisengappali&Vadkalurvillages, Annurtaluk, Coimbatore district Tamil Nadu, is best suited with the kind of climate. The project would cater to the people working in this area.

6.3.1 Ground water point of view The project consumes about 2400 KLD of fresh water in a day which will be sourced from New Tiruppur Area Development Corporation Limited (NTADCL)& bore well. The generated sewage from the project will be treated and used for green belt maintenance. Efficient recharge system replenishes the depleted ground water. Hence, there won’t be any impact on ground water quality / quantity.

6.3.2 Soil quality point of view

The soil analysis was already carried out, and was found to be good. There are no chances of soil contamination and no discharge of wastewater from unit operations which may contaminate the ground water table.

6.3.3 Air quality point of view

Air emissions will be only from DG Sets, for which stacks are provided with a height of 3m above building height for all DG Sets. Added to this, the fuel used is Ultrapure low sulphur content diesel and thus the emissions will be lowest.

6.3.4 Noise quality point of view

The generation of noise from project is negligible, as the only noise generating equipment are the DG Sets which comes with an inbuilt acoustic enclosure which has noise levels <75 dB.

6.3.5 Floral & Faunal diversity point of view

No kind of Floral & Faunal destruction is envisaged for the current project. As a matter of fact, the project is going to add further to the existing situation as landscape development is proposed for about 6.45 Ha. More area will be developed for green belt during future development.

6.3.6 Hazardous waste point of view

The project will generate any hazardous waste in the form of e‐waste. However, the authorization of the Tamil Nadu Pollution Control Board will be obtained as per the norms of the E‐waste management and Hazardous Waste Management Rules. The waste oil from the DG Sets will not be discarded in any open area. Hence there is no threat to the soil and the neighbouring area due to waste oil.



Final conclusion The project would development have very less negative impact on the surrounding area or on the environment. The project would indeed help the economy and socio economic condition of the area and it is very highly recommended for the establishment of the project to favour exports and imports. The project would not have any negative impact on the soil, water, air or noise environment.



CHAPTER 7

MARKETING STRATEGY 7.1 Marketing efforts:

The objective of the special purpose vehicle, ADD‐ELCINA Electronics Park Private Limited (AEEPPL) is to promote sustainable electronics manufacturing, gainfully utilize the human resources to improve the standard of living and quality of life and conserve the environment of Coimbatore in general and Annur in particular, thereby ensuring a balanced industrial development. Amongst other strategic players, M/s. Electronics Association of India (ELCINA) is one of the partnersand the key driver behind the project.Thespecial purpose vehicle (SPV) will utilize ELCINA branding and will be promoted by ELCINA on national and international forums. ELCINA networks with national and international institutions and business promotion bodies to create awareness about this cluster and motivating investors to invest in the cluster. M/s. Tea Stall Studio, Gurgaonhas been appointed as the branding and advertising agency to strategically place the proposed EMC in the digital market orbit of electronics. They have created and designed the web page for EMC, which can be reached at www.prime641.com. In this web site, one can view the details of EMC, the facilities being offered, master plan, industrial plots available for setting up electronic manufacturing units besides its location, connectivity and other details by clicking on this URL address. Prospective investors / manufacturers can send their requirement of industrial space to the email address mentioned therein. Besides EMC,information of other clusters and major components within the proposed industrial park has been mentioned in this web page. The brand logo for the cluster is as shown below:‐

Promotional activities are also being carried out through some of the other top elite associations of electronics of India which include India Electronic Semiconductor Association (IESA), Manufacturer’s Association of Information Technology (MAIT) and Bangalore Chamber of Industry and Commerce (BCIC) through its members. Further, correspondence and discussions with some of the major prospective players are under way, which include M/s. Alstom Transport, France, M/s. Blue Star India Ltd., Chennai, M/s. Assetz Property Group, Bengaluru & M/s. Maxworth Consumer Products, Hyderabad to name a few.



Discussions are also under way with M/s. Ernst & Young (E&Y), the global market facilitators for the promotion & propagation of our EMC. E&Y through their dedicated international desks are able to connect with the strategic investors in the international platforms. The SPV is participating in most of the Electronics exhibition shows in the country and in international level through ELCINA.

7.2 Marketing strategy:

The strategy–from conceptualization to implementation

a. Macro Mapping of EMC and SWOT analysis of the location b. Market Assessment and Demand Analysis for various electronic products locally & globally c. Marketing Strategy& Development of Collaterals (including Website, Flash Presentation,

Brochure & Annexure, Exhibition Display Graphics and Site Displays Press Kit) d. Media and Public Relations e. Expo, Road‐shows and other Events f. Sales Process Management g. Customer Relationship Management

As a first step, AEEPPL commenced its informal marketing of the EMC upon receipt of the “In‐principle” approval for the project from DeitY. While aggressive marketing activityhas been envisaged only after the final approvalof the EMC by DeitY; participation of AEEPPL at several conferences and exhibitions hasevoked tremendous interest among the industry players to associate in the project. Based on the understanding of the various key products of electronics and analyzing the requirements of the potential investors and other tenants and users, AEEPPL has evolved a marketing strategy to achieve the desired sales and objectives. Principally, the marketing strategy has been categorized as follows:

a. Identification of targeted industries b. Collection of primary database of identified industries c. Brand Establishment d. Positioning of product e. Right pricing f. Marketing collaterals g. Creation of serene, sustainable and industrial atmosphere

A great thrust has been put on branding the company, for which the following actions have been identified:

a. A website has been developed. b. The main brand logo and sub‐logo are finalized.



c. E‐mailers and flyers have been prepared. d. A comprehensive brochure for the EMC has been finalized. e. Power Point Presentation (PPT) for national and international investors is under way. f. Aggressive PR exerciseis being planned.

7.3 Industrial park advantage:‐

A mega industrial park, which encompasses the proposed EMC, is being developed in an area of about 1500 acres, which comprises of various other industrial clusters for MSME, auto components, textile, food processing and pharmaceuticals amongst others. The park would also comprise of a knowledge city, centre for skill development, golf course, social and recreational infrastructure, shopping complex, hotels etc.Therefore, the units coming up in the EMC may be able to utilize and leverage the facilities, infrastructure and advantage of the park and other clusters besides appreciation of land value and greater standard of living. As such, the cluster mix of various verticals for the industrial park has been aimed to systematically include various products and services which would enhance the concept values and achieve optimum synergies. The following segments have been identified for the proposed industrial park:

a. Separate clusters for MSME, food processing, textile, health etc. b. Knowledge city c. Biotech/Life Sciences d. Convention centre e. Logistics and warehouses f. Mall/Multiplex, Value retail and 3/4/5 Star Hotels g. Social infrastructure viz. housing, community centre etc. h. Recreational facilities, Golf course etc.

This development mix will generate good demand for housing and other social infrastructure, which is being developed in the proposed industrial park. This perfect blend of the development mix also avoids risks of major failure in the event of poor response to any segment and keeps on the possibility of modifying the plan and marketing strategy to a large extent. A significant boost to the proposed EMC is quite obvious with the development of industrial park.

7.4 Marketing initiatives:

With a view to promoting the EMC and attracting industries for setting up their manufacturing units, various marketing plans have been initiated through various platforms & media, which include participation at B2B meets, seminars, setting up stalls in various exhibitions, approaching association bodies since June’15 onwards.Some of the platforms/ forums in which the proposed EMC was presented in association with ELCINA are:



1. Electronics Show at Shanghai (Kunshan), China: ‐ a) A large electronics show was conducted at Kunshanin Shanghai, China from 30.06.15 to

03.07.15 organised by TEEMA of Taiwan in which the proposed EMC was exhibited. b) The show was represented by ELCINA wherein several Taiwanese and Chinese electronic

manufacturerswere met and persuaded to set up their electronic manufacturing units in the proposed EMC at Coimbatore.

2. Strategic Electronics Summit (SES), Bengaluru: ‐

a) The 6th Strategic Electronic Summit (SES), which was a two day (30.07.15 & 31.07.15) conference and exhibition for strategic electronic sector of Indian Defence was organized by ELCINA and supported by Department of Electronics & IT (DeitY), DRDO & BSF.

b) A stall was set up at this event showcasing the features of EMC, its location and other advantages of establishing units within it. Brochuresand fliers were distributed.

c) Several prospective investors were approached with a view to wooing prospective manufacturers to set up units within the EMC.

d) Such prospective investors are being contacted by way of business letters, telephone calls and meeting them personally. Notable are BDO i2i, Bengaluru, SLN Technologies, Bengaluru etc.

3. Global Investors Meet (GIM) 2015, Tamil Nadu

a) This was a two day mega global event organized by the Government of Tamil Nadu attended by about 5000 delegates including 1000 from abroad on 10.09.15 & 11.09.15, wherein the state of Tamil Nadu was showcased as a top investment destination.

b) At this event, several B2B meetingswere held with prospective strategic investors and financial institutions. Some of them are:M/s. Ampree Compressors Private Limited, Coimbatore, Citibank, Attivo, Kolkata, SunEdison Energy India Private Limited, Stellar Energy, Welspun Renewable Energy Private Limited, Canada Development Council& Australian Trade Commission.

4. IT Asia, Hyderabad

a) This conference cumexhibition was heldfrom 24.09.15 to 26.09.15, which was organized by Manufacturers Association for Information Technology (MAIT).

b) A stall to promote the EMC was set up at the event and brochures were presented to the visitors.

c) Had detailed discussions with MAIT and discussed ways and means to promote the EMC through its members.

d) Some of the companies contacted are DELL, HP, Lenovo, Acer, RDP and other medium scale manufacturers. Many of them have evinced to look at the EMC as next option during their expansion stage.



As part of the marketing efforts, several countries through its embassies, consulates and industrial associations have been approached to disseminate information of the proposed EMC to its electronic manufacturers. An exhaustive/detailed questionnaire/enquiry form has been prepared and being forwarded to the prospective investors to understand their capabilities and requirement to set up their units in the EMC.



CHAPTER 8

MANAGEMENT ARRANGEMENTS

8.1 Development of the project

The EMC project is a partnership between ADD Industrial Park (Tamil Nadu) Limited (AIPL), Electronics Industries Association of India (ELCINA), Om Metals Infraprojects Limited (OMIL) and Adhunik Power Transmission Limited (APTL). With AIPL as the Chief Promoter, an SPV has been incorporated in the name of ADD‐ELCINA Electronics Park Private Limited (AEEPPL) exclusively for the development and management of the proposed EMC. More members will be inducted into the SPV as per the guidelines of DeitY in due course of time. The project is envisaged to be completed under one single phase comprising of the stages mentioned below upon the receipt of ‘in‐principle’ approval from DeitY, which has been obtained in May 2015:

a) Submission of final application and DPR to DeitY and receipt of final approval. b) Pre‐construction stage

i. Finalization of architectural and engineering designs ii. Floating tenders and finalization of contracts iii. Preparation of detailed working drawings iv. Mobilization and start of construction

c) Construction stage i. External road development ii. Boundary wall and gate‐house iii. Construction of internal roads and common amenities iv. Construction of buildings and other infrastructure

d) Post construction stage e) Operation and Maintenance (O&M) stage



PROJECT DEVELOPMENT STAGES

Submission of final

application / DPR and receipt of

final approval

Pre‐construction Construction Post Construction O&M

Duration 2‐3 months 3 months 18 ‐ 21 months 4 months Upon commissioning and continuous

Funding SPV (AEEPPL) SPV (AEEPPL) SPV (AEEPPL) + DeitY+ Members+ +Bank

SPV (AEEPPL) +DeitY+ Members+ Bank

Generated by SPV (AEEPPL) + Members contribution

KRAs to proceed to next stage

Final Approval of DeitY

Sign off with DeitY. Finalisation ofengineering designs, reports and contractors.

Construction and monitoring by SPV

Completion of infrastructure development and commencement of operation of units

8.2 Management structure:

For the efficient implementation and running of the EMC as per the guidelines of DeitY, the roles and responsibilities of different entities are to be drawn up for which a management structure has to be in place. Such a management structure needs to give due consideration to the interests/concerns of all the stakeholders for the smooth implementation and sustenance of the project. As a starting point in defining the project structure, the Chief Promoter and other members of the SPV would initiate the preparation and submission of application and final DPR and during the process of evaluation by DeitY till final approval of the EMC project. Subsequently, upon approval to the project, the SPV would appoint a Project Management Consultant (PMC) for assistance in the development of land and infrastructure for the project. With the assistance of PMC, the SPV would undertake the construction of the project through contractors and would be the implementing agency for the project. The management structure of the project is as shown in Figure below.



8.3 Roles & responsibilities:

a) Chief promoter (AIPL) and other members of SPV: i. Manage the process of final application and DPR with DeitY for final approval of the project

and financial assistance; preparing the DPR and offering clarifications to DeitY and its consultants on the application, layout, project components, implementation aspects, financial model etc.

ii. Ensure that the lease deeds for transfer of land by the Chief Promoter and its affiliates to the SPV are in place upon receipt of final approval of the project by DeitY.

iii. Facilitate theinclusion of new members (constituent manufacturing units) into the SPV. iv. Undertake the implementation of the project and ensure its successful completion. v. Provide funds and raise finance as and when required for the project implementation. vi. The Chief Promoter and other members would use its vast experience in construction and

project management would act as development partners to implement the project as per best industry practices and at arm’s length.

vii. As directors of the board of SPV, use their experience, business acumen and network of relationships to ensure that SPV is run efficiently and profitable during all the stages and as per the guidelines of DeitY.

b) ELCINA:

i. Will act as the knowledge partner and guiding force in the SPV towards successful management of the EMC.

ELECTRONIC MANUFACTURING STRUCTURE

PMC

SPV (AEEPPL) WIITH ITS CONSTITUENT MEMBERS



ii. Will identify gaps in the manufacturing facilities in India and help identify companies, which could be invited to set up units in the EMC.

iii. ELCINA will actively promote the EMC and work towards increasing manufacturing capability in the cluster. It will endeavour to achieve at least 80% occupation in the EMC within 2 years of commencement of development of project.

iv. ELCINA shall license its trademark ELCINA to the SPV and pass on the associated reputational benefits to the SPV.

v. ELCINA will actively assist in enlisting members who are desirous of investing and setting up common facilities within the EMC.

vi. ELCINA will assist the SPV in drafting common policies with regards to usage, pricing and maintenance of such common facilities.

vii. ELCINA will coordinate and represent issues relating to the park with Government and other authorities and bodies.

c) SPV (AEEPPL)

i. Manage the process of final application and DPR with DeitY for final approval of the project

and financial assistance; appoint consultants for preparing the DPR and offering clarifications to DeitY and its consultants on the application for obtaining final approval to the EMC project.

ii. Appoint the Project Management Consultant (PMC). iii. Obtain financial assistance (grant) for the EMC from DeitY and monitor its proper utilization. iv. Lay down policies and procedures that ensure fair, transparent and ethical practices are

followed in conduct of its business as well as to comply with the guidelines of DeitY under which the grant would be received.

v. Device allotment policy for allotting developed plots to the prospective EMC units in joining the EMC. Allotment policy shall include, inter alia, the applicant screening process to ensure compliance with the cluster eligibility criteria, quantum of land to be allotted, pricing structure and payment terms and entry and exit policies.

vi. Manage the execution of the EMC project and ensure its completion as per the project plan within the defined cost and time estimates.

vii. Manage the cash flow during all stages of the project implementation. viii. Devise policies and procedures for operations, maintenance, security and other related issues

of the EMC. ix. Appointing staff and managing the day to day operations of the SPV. x. Ensure collection of fees and charges from the constituent members for smooth running of

common facilities within the EMC xi. Take up common issues pertaining to the constituent units and EMC with the Governments

and other agencies / bodies. xii. Any other roles and / or responsibilities stipulated in the guidelines of DeitY.



d) The PMC i. Preparation of Project Plan including setting the standards for infrastructure development. ii. Structure and appraise the project and submit the same for consideration of SPV. iii. Assist the SPV in selection of agencies / contractors for preparation of bid documents,

construction and maintenance of facilities for the EMC project. iv. Assist the SPV in achieving financial closure where required. v. Monitor the implementation and submit periodical progress reports to the SPV. vi. Any other roles prescribed by DeitY in its guidelines.

8.4 Management of the SPV:

a) The SPV will be managed by its board of directors. b) The board of directors will be supported by the Chief promoter (AIPL) to fulfill various tasks. c) The Board of SPV shall appoint a CEO / COO on terms it deems fit.

8.5 Board of Directors of the SPV:

a) During Pre‐construction stage: Currently the SPV consists of two directors, one representing the Chief Promoter and the other director from one of the other promoters’ viz. OMIL. This status will remain till approval of the final application by DeitY and during the pre construction stage.

b) Construction stage: During this stage, the board of directors of SPV will have a minimum of 7 directors of which 4 shall be from the Chief Promoters and other Promoters other than ELCINA and 1 shall be nominated by ELCINA and 2 from constituent members. Efforts will be made to ensure that the Board of SPV will have 12 directors with 7 from constituent units, 4 from the Chief Promoters and other Promoters other than ELCINA and 1 from ELCINA.

c) O&M stage: When the EMC is fully operational, the board of SPV shall again be as mentioned above, comprising of 12 directors of which 7 shall be the nominees of constituent units within EMC, 4 representing the Chief Promoter and other Promoters other than ELCINA and 1 from ELCINA.

8.6 Shareholding in SPV:

a) During Pre‐construction stage: The current shareholding, which will continue during the Pre‐construction stage is as follows:‐



Company No of shares

Value INR/Share

Total Value %

ADD Industrial Park (TN) Ltd.

51,000 1 51,000 51%

ELCINA 10,000 1 10,000 10%

Om Metals Infraprojects Ltd.

26,000 1 26,000 26%

Adhunik Power Transmission Ltd.

13,000 1 13,000 13%

Total 100,000 100,000 100%

b) O&M Stage: During this stage, the constituent units within the EMC will hold equity of 51% while

the Chief Promoters and other Promoters will continue to hold 49% in the SPV. 8.7 Management of the SPV during O&M stage:

The SPV will continue to govern and administer the development, management and operations of the EMC during all the stages. For the day to day functioning of the SPV,there will be a team constituted upon receipt of final approval for the EMC from DeitY, as given in the table below: ‐

CEO / COO 1

Manager 2

Accountants 1

Clerks 2

Technical staff 3

Security 40

Housekeeping 40

IT 2

Office Support Staff 20

8.8 Promoters 8.8.1 ADD Industrial Park (Tamil Nadu) Limited (AIPL) is a flagship company under ADD Group involved in

infrastructure development in water & waste water treatment, solid waste management, power, technologies, real estate and development of industrial parks. In association with the Government of Tamil Nadu (GoTN), AIPL is in the process of establishing a mega industrial park at Annur near Coimbatore in Tamil Nadu. Spread out in an area of 1500 acres, the park would cater to a wide range of industries, which include manufacturing of engineering goods, textiles, electronics hardware, IT / ITES, educational institutions, R&D centers, housing and other social infrastructure. It would be an economic phenomenon in which many businesses simultaneously compete and collaborate to gain different economic advantages. As part of the policy of Government of India (GoI) to promote



electronic manufacturing in the country, a national policy on electronics (NPE) has been drawn up and one of the objectives of the policy is to establish electronic manufacturing clusters (EMC) in the country. In line with the policy, AIPL has embarked on a project to establish a state‐of‐the art EMC within the industrial park in an area of about 157 acres. For details about the proposed industrial park and EMC at Coimbatore, please visit www.prime641.com.

8.8.2 Electronic Industries Association of India, formerly known as ELCINA Electronic Industries Association of India was established in 1967 as the first industry association supporting electronics hardware, when India’s Electronics industry was still in its infancy. Since then, Electronic Industries Association of India (ELCINA) has established itself as an interactive forum for electronics and IT manufacturers. ELCINA actively interacts with the government and advises it on policy and business environment issues. It networks with technical institutions and business support organizations in India and abroad to enable business expansion and information dissemination on technical developments. With greater liberalization, ELCINA’s focus has shifted to professional and value‐added services to the Electronics Community.

While ELCINA’s focus was originally on promotion of manufacturing components ‐ the building blocks of the industry has widened its horizons and broadened its activities to include the development of entire Electronics and IT Hardware. ELCINA now focuses on promoting manufacture of: a) Electronic Components b) Industrial / professional electronics c) Defense / strategic electronics d) Electronic Manufacturing Services e) Other expanding areas in electronics such as Medical, Automobile, Electronic Design, Embedded

Systems and more

ELCINA’s focus is to support the value chain for Consumer Electronics, Telecom and Computers / IT correlating their common interest with that of equipment, material and machinery producers for expansion of manufacturing.

ELCINA believes that the Government and the industry need to work together to stimulate manufacturing and catalyse an IT / Electronics boom that can contribute significantly to the development of India. ELCINA persistently works to facilitate changes that would strengthen India’s electronics and IT manufacturing base to make it a leader on the world electronics map.

8.8.3 Om Metals Infraprojects Limited (OMIL) is a conglomerate having diverse business activities and interests related to hydro mechanical equipment, turnkey solutions for steel fabrication, hydro power development, real estate, leasing, finance, entertainment centres, hotels and tourism. It is a leading ISO 9002 company established in 1971 and a pioneer in the field of turnkey execution from Design, Detailed Engineering, Manufacture, Supply, Installation, Testing & Commissioning of complete range of Hydro mechanical equipment for Hydroelectric Power & Irrigation projects, PHED, PWD & various Corporations.



OMIL has to its credentials more than 40 projects completed all over India and Abroad for Design, Manufacture, Supply, Erection, Testing and Commissioning of Hydro‐Mechanical Equipment. Employing more than 400 managerial, technical, skilled and semi‐skilled manpower, OMIL is fully capable and resourceful to execute the projects of any magnitude timely and confidently. It has key and critical plants, tools, equipment and manpower required to execute turnkey contracts for small, medium and large hydroelectric power projects.

OMIL is well acquainted with modernized methods of fabrication and erection and have successfully completed the works in remote areas, difficult climate & natural site conditions, logistics bottlenecks, difficult roads and great distances.

8.8.4 Adhunik Power Transmission Limited (APTL) offers electrical power transmission services. The company was founded in 1991 and is based out of Kolkata, West Bengal. A subsidiary of Deepak Cables India Limited, ATPL is in the business of manufacturing and selling transmission lines and tower components. It was formerly known as Unistar Galvanisers & Fabricators Limited. ATPL has been approved by the Power Grid Corporation Limited of India and various other state electricity boards for manufacturing transmission line towers and sub‐station structures. Its products include tower accessories (clamps, anti‐climbing devices, bird guards, U bolts, hangers etc.), ground‐based and rooftop galvanised telecom towers, galvanised cable trays, perforated trays (and accessories like coupler plates, bends, fasteners etc), welded structures and masts for the railways and lightning masts, pipe structures, foundation bolts and accessories utilised in power and telecommunication. It was a wholly owned subsidiary of AdhunikMetaliks.

8.9 Profiles of key personnel The following are the profiles of the key personnel currently involved in the development of the proposed EMC project are as shown below: They represent the Chief Promoter (AIPL), other Promoter (OMIL) and ELCINA.

EMC AT ANNUR, COIMBATORE – DPR

ADD‐ELCINA ELECTRONICS PARK PRIVATE LIMITED Page88

Anil Sethi Chairman ADD Industrial Park (Tamil Nadu) Limited and ADD Group of Companies Mr. Anil Sethi, with over 30 years of engineering and infrastructure development experience is credited as a leader and spokesperson of the fast growing Infrastructure Industry of India. In his business and domain pursuits, Mr. Sethi has travelled across geographies and interacted with international business, industry and political leaders; he has been invited to several leading international forums as a speaker and advisor, apart from being an integral and lead member of eminent industry bodies and institutions such as: a) World Economic Forum b) Confederation of Indian Industry (CII) c) Federation of Indian Chambers of Commerce & Industry (FICCI) d) Steering Committees of Panels on Water Management and Urban Infrastructure He is currently the Chairman Emeritus of SPML Infra Limited. As Director / Chairman of SPML Infra Limited, Mr. Sethi’s extraordinary entrepreneurial acumen has been an inspiration in building the organization into a multi‐faceted conglomerate with EPC contracting experience in Water, Power and Infrastructure. His achievements during his leadership in SPML Infra Limited: a) Ensured Year‐on‐year growth of over 50% Annual Turnover b) The organization has consistently been a profit making enterprise since inception c) Conceptualized and ushered in IT as an enabler within the organization d) Under his supervision, SPML was Ranked 1‐ Fastest Growing Company in the Large

a. Category – (Source: Construction World & NICMAR – year 2009) As the Chairman, ADD Group of Companies, Mr. Sethi is currently focusing on development of the Group having several focus areas: a) Industrial Parks b) Real Estate and Infrastructure Development c) Information Technology Mr. Sethi has been the recipient of several national and international accolades for his strides and accomplishments in the industry. Notable are: a) Nominated / Empanelled as Eminent Citizen with the NREGA b) Outstanding Entrepreneur Award for his contribution as a Business Leader Par Excellence – by

Enterprise Asia – 2009 (An international panel / jury for Entrepreneurship) Award c) The Pride of India Gold Star Award and The Vikas Jyothi



Rajoo Goel Secretary General, Electronic IndustriesAssociationofIndia (ELCINA)

Mr. Rajoo Goel has varied experience in supporting electronics industry through his association with ELCINA, in manufacturing as a co‐founder of an auto components company and in services sector while working for International Data Management Pvt. Ltd. Mumbai, a Software and Data Processing company, which was an off shoot of IBM in India. Since 2003 he has been serving the Electronics Manufacturing Industry in India as the Secretary General of ELCINA and has been interacting with the government for guiding policy formulation for the industry as well as with international organizations supporting electronics hardware and business development. He has worked in coordination with industry towards creating a favourable environment for the growth of the Electronics Hardware industry. As an entrepreneur during 1986‐2003, Mr. Goel, has hands‐on industry experience managing an auto components company manufacturing auto instruments in the services sector, he has worked on computer systems analysis and programming at IDM, Mumbai and General Electric, Meter Business Division, USA. He has worked for a short duration in USA and has travelled widely to many Asian countries, USA and Europe developing substantial experience in international business. He has also received professional training from CBI Netherlands, as a Trainer for Export Promotion Strategies for SME’s and has considerable exposure to environmental management subjects such as RoHS, eco‐design and e‐waste related issues. Mr. Goel graduated in Economics from Shri Ram College of Commerce, Delhi University, earned a Certificate in Software Technology and Computing Techniques from Tata Institute of Fundamental Research, Mumbai and an MBA from the University of New Hampshire, USA.



VIKAS KOTHARI, Director ‐ Business Development Om Metals Infraprojects Limited

Om Metals Infraprojects Limited (OMIL) is a Public Listed conglomerate having diverse business activities and interests in Engineering Construction, Hydro Mechanical Equipment, Turnkey solutions for Steel Fabrication, Wind Power and Solar Power Development, Sea Port & SEZ Development, Roads Development, Real Estate Development, Automobile Dealership, Finance, Entertainment Centers& Hotels. Mr. Kothari is responsible for all the Joint Ventures and technical collaborations in the Company (Foreign & Domestic) for various projects. He was instrumental in raising USD 30 Million for OMIL through a Qualified Institutional Placement in year 2007. Mr. Kothari currently oversees all the New Business Development and Marketing activities for the Group.



Ganapathi Hegde Chief Executive Officer ADD Industrial Park (Tamil Nadu) Limited

Mr. Ganapathi Hegde is a self‐structured and multi‐talented person who has a Bachelor’s degree in Commerce & Business Administration. He joined the Group in the year 1996 as Accounts Officer. However, he has handled multiple tasks and assignments apart from not being restricted to Accounting section. Hence he has grown up to the level of being a ‘Chief Executive Officer’ of the Organization. His experience lies in Accounting, Commercial, Auditing, handling project activities, Real Estate management and Corporate Governance. His area of responsibilities includes and not limited to the following:‐ - Accounting: All financial transactions relating to branch up to finalization of balance sheet. - Commercial activities: Key person in charge of budgets, taxation and administration. - Real Estate: Handing complete marketing and sales activities of major properties. - Corporate Governance: Ensure high standards of business integrity, ethical values and

professionalism in all its activities. He is a person who strives to maximize the shareholder value while ensuring fairness to every stakeholder – customers, employees, investors, vendors, partners, government and the community.



Dr. Jayakumar Project Advisor ADD Industrial Park (Tamil Nadu) Limited A thorough engineering professional, Dr. Jayakumar has more than 25 years of extensive experience in planning, development, construction and management of infrastructure projects in India and abroad. An astute civil engineer with an M Tech and PhD both from IIT, Madras, he has served the government and private sectors at various engineering and management levels. He was the founder CEO of Vizhinjam International Seaport Limited, which is responsible for the development of India’s mega container transhipment terminal project at the southern‐most tip of India in Thiruvananthapuram and was also the Adviser (Ports) to Government of Kerala. Dr. Jayakumar was the Advisor (Projects) in Westport Malaysia and has extensively travelled to several countries including USA, UK, Germany, France, South Africa, Singapore, China, Australia etc. He currently serves as the CEO of Pondicherry Port Limited. Dr. Jayakumar has to his credit several papers in International Journals and Conference Proceedings and recipient of several awards including the Indian Achievers Award presented at the Indo‐Gulf Conference held in Dubai, UAE.



CHAPTER 9

MEANS OF FINANCE & PROJECT BUDGET

9.1. PROJECT BUDGET: 9.1.1. Land Cost

a) Total Area to be developed under the scheme is 157.69 Acres b) Total Area has been divided into two Categories, i.e.

i. Area for Development of Common Infrastructure and Amenities ii. Area for Saleable Purposes for setting of Electronic Manufacturing Units.

c) Following is the breakup of Total Area assumed

d) Total Land required for Development of Scheme, i.e., 157.69 acre to be purchased @ Rs 20 Lakhs per acre, therefore following is the breakup of cost of Land required for Development of Scheme:

Area for Development of Common Infrastructure and Amenities 62.33 Acres

Area for Saleable Purposes for setting of Electronic Manufacturing Units

95.36 Acre

Total Area 157.69 Acre

Area for Development of Common Infrastructure and Amenities

62.33 Acres Rs. 12,46,66,600

Area for Saleable Purposes for setting of Electronic Manufacturing Units

95.36 Acre Rs. 19,07,11,400

Total Area 157.69 Acre Rs. 31,53,78,000



9.1.2. Cost for Development of Common Infrastructure and Amenities

9.1.2.1. The total Cost for Development of Common Infrastructure and Amenities works out to be Rs 166.33 Crores.

9.1.2.2. Following is the Summary of Cost for Development of Common Infrastructure and Amenities:

Summary ofCost for Development of Common Infrastructure and Amenities:

Amount (in Rs. Lakhs)

% of Total

Processing & Non Processing

Basic Development 6021 36% Processing

Essential Services 6282 38% Processing

Welfare Services 2214 13% Non Processing

Support Services 1021 6% Processing

Manufacturing Support 505 3% Processing

Government Regulatory support/services

269 2% Processing

Landscaping (Green area) 323 2% Non Processing

Total 16634 100%

Further the total Cost for Development of Common Infrastructure and Amenities has been divided into two categories as per DeitY Guidelines, i.e., Processing and Non Processing Cost. Following is the Breakup of Cost for Development of Common Infrastructure and Amenities into Processing and Non Processing Cost:Total Processing project cost

Rs. 1,40,97,61,108

Total Non‐ Processing project cost Rs. 25,36,25,992

Total Cost for Development of Common Infrastructure and Amenities

Rs. 166,33,87,100



9.1.2.3. Following is the Cost break‐up details for Development of Common Infrastructure and Amenities. The detailed cost estimates are attached as Annexure 8.

Sl. No.

Description of Items as per Annexure‐2 : EMC

policy

Items / Areas considered / Item as per detailed estimate document

Amount Cost Break Up

Category (Processing/ Non‐

processing)

1 2 3 4 5 6

1 Basic Development

Boundary wall, internal roads, street lighting, external storm water drainage.

a Boundary wall & internal roads & Truck Holding area

Infrastructure development ‐ Civil work

50,57,85,377

60,20,54,349

Processing

b Street lighting Streetlighting ‐ Electrical Infrastructure

4,73,07,685 Processing

c Storm water drainage Plumbing infrastructure 4,89,61,287 Processing

2 Essential Services

Government support office, water treatment plant, sewage lines / treatment, waste disposal / recycling/ water harvesting, Electricity substation/distribution, backup power plant, warehousing

a1

Water Treatment Plant (WTP) including Bore wells & water supply lines

Plumbing infrastructure 5,21,89,461

38,36,44,581

Processing

a2

To be paid to Government of Tamil Nadu / its nominated agencies for conveyance of water system

Plumbing infrastructure 14,50,00,000 Processing

b Civil work for plumbing pump house

Civil work 11,22,72,645 Processing

c Sewage line with STP Plumbing infrastructure 7,41,82,475 Processing

d Electric Substation & distribution

Electrical infrastructure 19,05,75,911 21,38,04,888 Processing

1 2 3 4 5 6

e Civil work for electric Civil work 2,32,28,977 Processing



substation

f Warehousing ‐ Building‐7

Civil work of Warehouse 2,97,90,944 3,07,87,022 Processing Internal electrical work

for warehouse 9,96,078

3 Welfare Services

Employee hostel & mess, hospital, recreation facility, crèche, local shopping center, restaurant

a Employee hostel & Mess ‐ building 4

Civil Work of Employee hostel & mess

9,08,17,996

10,56,07,446 Non‐

processing

Internal Plumbing work of Employee hostel & mess

18,31,669

HVAC works for Employee Hostel & Mess

79,59,285

Internal electrical work of Employee hostel & mess

49,98,496

b Hospital & ESIC ‐ building‐8

Civil work ‐ Building‐8 ‐ medical center

2,17,81,076

2,36,87,436 Non‐

processing Internal Plumbing work of medical center

7,94,170

Internal electrical work of medical center

11,12,191

c Clubhouse ‐ building‐5

Civil work ‐ Building‐5 : Clubhouse

3,75,61,878

4,43,40,882 Non‐

processing

Internal Plumbing work of clubhouse

8,50,828

Internal HVAC work of clubhouse

40,02,633

Internal electrical work of clubhouse

19,25,543

d Worker welfare building ‐ building‐6‐ 3nos

civil work ‐ building 6 : worker welfare X 3

4,10,77,315

4,77,32,727 Non‐

processing Internal Plumbing work of worker welfare x 3

17,44,391

Internal electrical work of worker welfare x 3

49,11,021



1 2 3 4 5 6

4 Support Services

R&D, training, auditorium, video conference, IT , business center‐ Admin & Training building

a Building‐2 : Support Services: Admin & Training Building

Civil work ‐ Building‐2 ‐admin & Training building

8,57,05,530


Internal Plumbing work of admin & training building

14,55,429

Internal electrical work of admin & training building

49,09,933

HVAC works for Admin & Training building

1,00,33,779

5 Manufacturing Support tool room, CAD/CAM, testing, certification

a Building‐3 : Manufacturing support building

Civil work ‐ Building‐3‐Manufacturing support building

4,19,12,506


Internal Plumbing work of manufacturing support building

7,36,762

Internal electrical work of manufacturing support building

12,64,943

HVAC works for manufacturing support building

66,00,531



1 2 3 4 5 6

6 Government Regulatory support/services

Entry/ exit, Security , time office & government support offices

a Building‐1 : Gatehouse

Civil work ‐ building‐1 ‐ Main gatehouse building having the timeoffice & government support building

2,41,22,980

2,68,50,855 Processing Internal Plumbing work of Gatehouse building

2,47,029

HVAC works for manufacturing support building

11,99,720

Internal electrical work of Gatehouse building

12,81,126

7 Landscaping (green area)

green area development @ Rs.500/sqm

3,22,57,500 3,22,57,500 Non‐

processing

Total project cost

166,33,87,10

0

Total Processing project cost

1,40,97,61,108

Processing

Total Non‐ Processing project cost

25,36,25,992

Non‐processing



9.2. Grant calculation: As per DeitY guidelines, it has been assumed 50% of Total Processing Cost, 20%

of Non‐Processing Cost and 3% of Total of Processing & Non Processing Cost as Administrative cost, Grant will be provided. According to this total Grant assumed to be Rs 77.83 Cr. Following is the Calculation for Grant:

Grant Calculation Processing/Non‐

processing Grant (in %)

Grant Amount (Rs. Lakhs)

Processing Costs 1,40,97,61,108 50% 70,48,80,554

Non Processing Costs 25,36,25,992 20% 5,07,25,198

Administration Costs Allowed for Grant

3% 2,26,68,173

TOTAL GRANT 77,82,73,925

9.3. Means of finance:

Total Funding needs to be arranged by SPV a) It is assumed that SPV needs to arrange for the Total Cost for Development of Common

Infrastructure and Amenities Less Grant of its own, i.e., (Rs 166.33 Cr ‐ Rs 77.82 Cr)= Rs 88.51 Cr

b) In addition to the above, i.e., Total Cost for Development of Common Infrastructure and Amenities, SPV needs to arrange funds for the following:

i. Land Cost ‐ Rs. 31,53,78,000 ii. Administration Expenses ‐ 3% of Total of Processing & Non Processing Cost iii. CSR Development Activities to be carried out at 0.5% of Total of Processing & Non

Processing Cost and land for common area

c) To finance the additional funding required it has been assumed that the SPV will go for Project Finance route. For the Project Financing of Land Cost is being divided into following two Categories:

i. Area for Development of Common Infrastructure and Amenities – Rs. 12.47 Cr, will be

financed through Project Financing Route. ii. Area for Saleable Purposes for setting of Electronic Manufacturing Units costingRs. 19.07

Crores will be financed through Bridge Loan (Short Term Loan) @ 13% Interest and will be repaid immediately in Single Instalment in Second Year of Development once the SPV will have Cash Inflow from Sale of Plots cum Units.



9.4. Project Finance – Based on the above following will form part of Project Finance which needs to be arranged by SPV:

Summary of Cost to Arranged by SPV and funded through Project Finance Mechanism

Rs. In Lakhs

Area for development of common infrastructure and Amenities 1,247

Total Cost for Development of Common Infrastructure and Amenities Less Grant

8,851

Administrative expenses (3% of Total of Processing & Non Processing Cost) 499

CSR development Activities (0.5% of Total of Processing & Non Processing Cost and land cost)

83

Total 10686

i. Total Cost to Arranged by SPV will be financed through Debt: Equity of 70:30 ii. Under Project Financing, Interest During Construction for the Debt utilized will also form

part of Project Financing, which will financed through Debt: Equity proportionately iii. Debt is assumed to be raised under Project Financing at 13% Interest Rate and will be

repaid in 5 years after the Construction Completion and with the following Repayment Mechanism:

Year Year 3 Year 4 Year 5 Year 6 Year 7 Year 8

Repayment Installment

30% 30% 8.00% 8.00% 8.00% 8.00%

iv. Repayment Mechanism has been assumed to ensure that debt is repaid immediately as

soon as SPV has sufficient funds and there is not much of Interest Liability and thus increases Project Viability.

v. 30% Equity will be brought in by SPV, wherein 49% will be contributed by the Chief Promoter and 51% will be contributed by the Unit Holders.



9.5. Summary

Description Amount

(in Rs. Lakhs)

Total Cost for Development of Common Infrastructure and Amenities 16,634

Less Grant 7,783

Total Cost for Development of Common Infrastructure and Amenities Excluding Grant

8,851

Land for Development of Common Infrastructure and Amenities Excluding Grant

1,247

Administrative Expenses (3% of Total of Processing & Non Processing Cost)

499

CSR Development Activities (0.5% of Total of Processing & Non Processing Cost& land for common amenities)

89

Interest During Construction 1,132

Total to be Funded through Debt & Equity 11,818

Means of Finance INR Lakhs

Grant 7,783

Debt 8,273

Equity ‐ Contribution by Chief Promoter 1,737

Equity ‐ Contribution by Unit Holders 1,807

Total 19,601

Funds to Arranged by SPV through Bridge Loan (Short term Loan) 1,907 Lakhs

The details of the financial statement are attached in Annexure 9.



CHAPTER 10

TIME FRAME Time is of utmost essence for any successful project. It is estimated that the project will be completed within 24 months of the final approval received from Deity. The key stages of the project are as follows: 10.1 Pre‐construction activity

This refers to the time required to undertake the detailed design and engineering for the project and finalization of the contractor for execution of the project on site. Detailed project planning & project management scheduling shall also be undertaken during this time period. 3 months shall be required for this activity.

10.2 Construction activity

The construction of the project including development of the common infrastructure, amenity buildings, water and drainage network along with the electric, IT and communication utilities shall be done during this phase. It is estimated that a total of 18 months shall be required to complete this activity.

10.3 Post construction activity

This refers to the time required for commissioning, testing and checking of all the work in the project. 3 months are required for this activity.

The detailed timeline along with the bar chart is attached below.



DETAILED PROJECT TIMELINE ADD‐ELCINA ELECTRONICS PARK PRIVATE LIMITED at AnnurTaluk, Coimbatore, Tamil Nadu

Sl. No.

Category / Component Month

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

A PRE‐CONSTRUCTION

B CONSTRUCTION 1 Basic Development

a Boundary wall & internal roads & Truck Holding area

b Street lighting

c Storm water drainage

2 Essential Services

a Water Treatment Plant (WTP) including Bore wells & water supply lines

b Sewage line with STP

c Electric Substation & distribution

d Warehousing ‐ Building‐7



Sl. No.

Category / Component Month

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

3 Welfare Services

a Employee hostel & Mess ‐ building 4

b Hospital & ESIC ‐ building‐8

c Clubhouse ‐ building‐5

d Worker welfare building ‐ building‐6 (3 Nos.)

4 Support Services

a Building‐2 : Support Services: Admin & Training Building

5 Manufacturing Support

a Building‐3 : Manufacturing support building

6 Government Regulatory support/services

a Building‐1 : Gatehouse

7 Landscaping (Green area)

C POST CONSTRUCTION



CHAPTER 11

RISK ANAYSIS

11.1.Risks can be classified as below:‐

a) Firm specific risks: Firm‐specific risks, also known as micro risks, are those political risks that affect the project level locally up to State Government level.

b) Country specific risks: Country specific risks,also known as macro risks, are those political risks that

also affect the project level but originate at the country level. c) Global specific risks: Global‐specific risks are those political risks that affect the project at the

project or corporate level but originate at the global level.

11.1.1. Firm specific risks

a) Governance risks: There is no governance risk involved with the EMC project. During pre‐operational stage the governance will be carried out by the consortium members as agreed by the MoU signed between them. The consortium members are experienced in establishing large scale projects. Once he EMC is established there will be 12 Board of directors out of which seven will be from the constituent units, one from Electronic Industries Association of India and four from the consortium members ensuring that the constituent units have majority in the decision making.

b) Conflict with State Governmentrisks: The State Government is fully supportive of the project as establishing the EMC is in line with the State’s initiatives in promoting Electronic Manufacturing. The State has given a letter in support of the project which was handed over to DeitY during preliminary application. Also MoU has been signed in advance with the state for development of the Industrial Park, within which the EMC will be located.

c) Political risks:The current ruling party is likely to continue. Even in the case of a change in political leadership, since the EMC is contributing to the State’s economy, employment generation and development of the local area, no risks are envisaged.

d) Labourunionrisk: Tamil Nadu ranks first among the states in the Country in terms of number of factories and industrial workers. The workers are hardworking and not prone to unrests. Rather entrepreneurs from neighboring states invest and establish manufacturing units in Tamil Nadu.

e) Revenue risk: Sensitivity analysis shows that even when revenue is reduced by 15%, returns on

the project are viable. Current IRR is calculated at 14.21% for the project and at a scenario, if revenues fall by 15% than assumed, the IRR is still attractive at 12.45%.At the pre‐operational stage which is in the first two years, no revenue is being assumed from constituent units other than sale of plots. Sale of plots is spaced across 3 years and only 20% of the plots are assumed to be sold in



Year 1 and another 35% in Year 2. Post operational stage revenues are pre‐agreed between constituent units and vendors while signing the investor agreement.

f) Completion risk: The project is being managed by a highly experienced team who has experience

in large scale project management. Only a reputed agency will be engaged for implementing the project. Clear project performance parameters and time lines for each phase will be laid down. A monitoring team will be set up by the management team and the project would be closely monitored for performance parameters. Penalty clauses for time overruns will be added in the agreements with implementation agency and contractor.

g) Cost overrun risk: Sensitivity analysis shows that even when the project cost increases by 15%

returns on the project are viable. Contingencies for cost overruns have been catered for in the project budget. In a scenario where cost overruns by 15% of the calculated project cost, the IRR is still viable at 10.26%. Cost overruns will be controlled through prudent project management and budgeting. The project monitoring committee will work closely with the implementing agency and monitor expenses.

h) Operating risk(Infrastructure failures): For common facilities and infrastructure DG sets have been

catered for as back up. Street lights are being powered by solar energy. For water bore wells are available for emergency supply. Dedicated communication lines are planned. Periodic maintenance is planned and an efficient agency will be engaged with clear penalty clauses for failure.

i) Force majeure risk: There have been no major natural calamities in the area where the EMC is

proposed. No major calamity is envisaged in the future. A comprehensive emergency response management policy will be framed along with roles identified and actions to be taken.

j) Environmental risk: The EMC is planned as a “green” campus. An Environment Impact Assessment

report has been carried out by an expert consulting agency and submitted to State Environmental Impact Assessment Authority (SEIAA). There is no significant impact on the Environment from development activities. Post operation each constituent unit will establish their own effluent treatment plant. The EMC will obtain a green certification rating.

11.1.2. Country specific risks

a) Money transfer risks: No money is being transferred from abroad for the project. b) Cultural & institutional risks: Cultural and ownership issues are not considered as they have no

impact on establishing the EMC. The SPV will be constituted as per SPV guidelines notified by Deity.

c) Conflict with the Government risks: The Government of India is the biggest proponent of the

Electronics Industry and establishing the EMC is in line with the National Policy on Electronics. d) Political risks: The current Government still has 4 more years to govern the Country before a

change is envisaged.

11.1.3.Global‐specific Risks:



a) Terrorism: The EMC campus will be adequately guarded 24X7, though there is no specific reason

for terrorist attack on campus. b) Cyber‐attacks: Adequate cyber security measures will be taken at the IT center of the EMC and a

policy on Cyber security will be developed and implemented.



CHAPTER 12

FINANCIAL & ECONOMIC ANALYSIS

12.1 Key revenue assumptions

The major revenue streams for the cluster are as follows:‐ a) Sale of Land b) Maintenance Charges c) Fresh Water Charges d) Recycled water Charges e) Infrastructure Renewal Charges f) Tool Room Charges g) Testing Centre Charges h) Hostel Charges i) Rental Income j) Warehouse Rent k) Skill Development Charges l) IT & Telecom Facility Charges

12.1.1 Commonassumptions

a) Capacity utilization: It is expected that the occupancy of units in EMC would be 40% in the 3rd year, 75% in the 4th year, 85% in the 5thyear and 95% thereafter for financial calculation. Occupancy of EMC by units, Tool room, Testing Centre and Hostel Utilization is as shown in the Table below:

Capacity Utilization –Facility Year 3 4 5 6 7 8 9 10 11 12

Occupancy of EMC by Units 40% 75% 85% 95% 95% 95% 95% 95% 95% 95%

Tool Room 40% 60% 75% 80% 80% 85% 90% 90% 90% 90%

Testing and Measurement 40% 60% 75% 80% 80% 85% 90% 90% 90% 90%

Capacity Utilization –Hostel 50% 60% 70% 80% 80% 80% 90% 90% 90% 90%

b) All common facilities charges are expected to increase at 5% YoY other than mentioned specifically.

12.1.2 Sale of land: The saleable area of land is 95.36 acres. This land is to be sold to units wanting to set

up manufacturing facilities and service facilities in the cluster. The land is expected to be sold across 3 years from the date of approval of the DPR. The price of land is expected to escalate at 15% in year 2 and 20% in year 4. The assumptions on the quantity of land to be sold and per square metre price across 3 years are as per the Table given below:‐



1stYear 2nd Year 3rd year

% of Area Sold 20% 35% 45%

Increase in Selling Price 15% 20%

Selling Price/SqMtrs.in Rs. 2373 2729 3275

The expected revenue from land across first 3 years is as given below:

Time Schedule Year1 Year 2 Year 3

Revenues from Sale of Plots (In Rs. Lakhs )

1831 3685 5685

12.1.3 Maintenance charges: This is a revenue stream to be contributed by the units which have bought

plots in the cluster. Each unit will be charged Rs 240 / Sqr. Mtrs. /year of total area held by them. This is for maintenance of individual plots. This revenue is expected to increase by 7% YoY.

12.1.4 Fresh water charges:The total requirement of fresh water for manufacturing units has been

assessed at 2057 KLD. This will be charged at Rs 100/‐ per KL. This revenue is expected to increase by 7% YoY.

12.1.5 Recycled water charges: The total water supplied by the STP will be 3729 KLD. This will be charged

at Rs 50/‐ per KL. This revenue is expected to increase by 7% YoY. 12.1.6 Infrastructure renewal charges:This is a revenue stream contributed by the constituent members

of the cluster. This is for maintenance asset replenishment of common infrastructure and will be charged once in 3 years after the cluster becomes operational. This revenue is assumed to increase at 7% YoY. This will be charged at Rs 125/‐ per square metre of land held by units owning plots in the cluster.

12.1.7 Tool room &testing centre charges:The tool room and testing centre will be an outsourced activity.

It is assumed that since the SPV will be providing facilitates and business opportunity and a complete eco system free of charge, SPV's revenue share will be 20%. The total revenue from tool room and testing centre are as per table below. The SPV will be earning 20% of these revenues depending on occupancy per year.



Tool room

Revenue/ year at 100% installed capacity

Total tool room investment 200

Revenue estimated % 20%

Total revenues per year at 100 % installed capacity (Rs. Lakhs) 40

Testing centre

Revenue at 100% installed capacity

No. of machines 10

Average rate per hour 500

Machine usage (Hrs/ day) 8

No. of days 300

Total revenue at 100% installed capacity (Rs. Lakhs) 120

12.1.8 Hostel charges: The revenue assumptions for hostel charges are as given in the Table below:‐

Employee hostel & mess

No. of beds 103

Charge per bed per night 150

No. of days 300

Revenue at 100% installed capacity (Rs. Lakhs) 46.35

Expected usage when cluster 100% occupied 90%

Total revenues when cluster at 100% occupancy 41.715

12.1.9 Rental income: The workers welfare building consisting of bank, local shopping, first aid, cafeteria

etc, the medical centre and club house are expected to be rented out. The total built up area available for rent is 3102 square metres and the rent assumed is Rs350/square metres per month as per the table below.

Rental income Size Rent P.M.

Rent P.A.

Sqr. Mtrs. Rs. Rs. Lakhs

Employee worker welfare building 1832 350 77

Clubhouse & restaurant 1270 350 53

12.1.10 Warehouse rent: A warehouse of 1400 Square metre is being set up in the cluster. This will be

rented out to units at Rs 250/ square metre 12.1.11 Skill development: The SPV will carry out skill development programmes for member units. The

cluster has 95 acres of saleable plots and The expected revenue from skill development is as per the Table below:‐



Assumed no of units in the EMC 95

Employees per unit 350

Total employees in cluster 33250

Employees trained per annum 15%

Training fees per person 3000

Annual training revenues at (Rs. Lakhs) 149.625

12.1.12 IT & telecom facility charges: The SPV will provide IT & Telecom facilities to member units. On an

average each unit is expected to use service worth Rs 1 Lac per year for usage of these facilities including video conferencing.

12.2 Key expense assumptions

The major operating expenses for the cluster are as follows: a) O&M charges for infrastructure b) Fresh &recycled water production c) Direct expenses for Tool Room, Testing Centre, Skill Development & Hostel d) Electricity e) Water f) Communication & Video Conferencing g) Warehouse h) IT Infrastructure i) Employee Expenses j) Insurance k) Marketing l) Land Cost m) CSR n) Maintenance cost on infrastructure

12.2.1 Common assumption: All costs increase 5% YoY.

12.2.2 O&M charges for infrastructure: For day to day operations and maintenance of infrastructure the following costs as a % of Capex for each sub‐component as given below in the table are assumed.

Basic Development 3%

Essential Services 5%

Government Regulatory support/services 3%

Landscaping (green area) 8%

12.2.3 Fresh & recycled water production: The cost for fresh and recycled water production charges per

KL are assumed as per the Table given below:‐



Fresh Water Production Charges 60

Recycled Water Production Charges 20

12.2.4 Direct expenses : The direct expenses for tool room, testing center, skill development ,hostel IT &

Telecom and warehouse as a % of revenue are as below:‐

Tool Room Direct Expense as a % of Revenues 80.0%

Testing Direct Expense as a % of Revenues 80.0%

Training & Skill Development Direct Expense as a % of Revenues 60.0%

Employee Hostel 10.0%

IT & Telecom 40.0%

Warehouse 10.0%

12.2.5 Electricity: The electricity consumption for common facilities is calculated at 800 units (kiloWatt‐

Hours). Assuming that electricity would be used for 8 hours per day and for 300 working days the cost of electricity for common facilities is calculated as per the Table below:‐

Max units consumed per hour 800

Hours/ day 8

Units Consumed by SPV per day 6400

No of working days 300

Load Factor % 75%

Cost Rs. per unit INR 7

Annual Electricity Cost (Rs Lakhs) at Maximum Load usage 101

12.2.6 Water production charges: A total of 2407 KLD of water will be required for Maintenance of

Common Facilities once it is operational. The water production costs are assumed as per the Table below:‐

Water Expenses

Daily water usage(in KLD) 2407

No of days 300

Cost per Litre INR 0.01

Annual Cost of Water INR Lakhs 72.21

12.2.7 Communication& Videoconferencing Expenses: This is assumed at Rs 12 Lakhs per annum.



12.2.8 Employee Expenses: For smooth day to day operations of the cluster the following employees are

required. Security and Housekeeping may be out sourced. The employee expenses are as given in the Table below:‐

Employee Type Number

MonthlySalary INR

Annual Salary

INR Lakhs

Annual Benefits INR Lakhs

Annual Total CTC INR Lakhs

COO 1 125000 15.0 3.0 18.0

Manager 2 60000 14.4 2.9 17.3

Accountants 1 30000 3.6 0.7 4.3

Clerks 2 12000 2.9 0.6 3.5

Technical staff 3 25000 9.0 1.8 10.8

Security 40 10000 48.0 9.6 57.6

Housekeeping 40 10000 48.0 9.6 57.6

IT 2 40000 9.6 1.9 11.5

Office Support Staff 20 12000 28.8 5.8 34.6

Annual Manpower Cost 111 179.3 35.9 215.1

Annual Benefits ‐ (% of Salary)

20%

Attrition 5% 10.8

Annual Employee Cost (incl. attrition)

226

12.2.9 Insurance: Insurance costs are assumed at 0.25% of the total project cost. 12.2.10 Marketing: Marketing expenses are assumed for first 3 years. This is the cost associated with

marketing activities for the cluster and brokerage for sale of land (revenue from sale of plot). This is assumed at 5% of the land value.

12.2.11 Land value: This is the cost incurred in purchase of the land by SPV. 12.2.12 CSR: Corporate Social Responsibility programmes are planned and initially during construction

0.50% of the project cost and after the cluster becomes operational 0.50% of the PAT is being allocated for these activities.

12.2.13 Maintenance cost on infrastructure: This is the cost incurred on asset replenishment and general

maintenance of the infrastructure. This is expected to be 5% of the Capex once in every 5 years after the cluster becomes operational.



12.3 Financial highlights

12.3.1 The project IRR is 13.27% across 20 years and the Equity IRR is 15.31%. The Project NPV is Rs 140

Lakhs and Equity NPV is 703 Lakhs, both at a discounted rate of 13%.

Key Output

Average DSCR 1.53

Project IRR 14.31%

Equity IRR 17.11%

Project NPV INR Lakhs 13% 694

Equity NPV INR Lakhs 13% 1,258

12.3.2 Sensitivity analysis: Effect of change in project cost on Equity IRR and Project IRR. Following are the different scenarios and how Equity and Project IRR is affected due to change in Project Cost:‐

Change in Project Cost

Project IRR Equity IRR

14.31% 17.11%

‐15% 20.93% 34.55%

‐10% 18.26% 25.85%

‐5% 16.09% 20.66%

0% 14.31% 17.11%

5% 12.79% 14.44%

10% 11.48% 12.33%

15% 10.34% 10.61%

12.3.3 Effect of Change in Sale Price of Land on Equity IRR and Project IRR. Following are the different

scenarios and how Equity and Project IRR are affected due to change in Sale Price of Land:‐

Change in Sale Price

Project IRR Equity IRR

14.31% 17.11%

‐15% 12.54% 13.81%

‐10% 13.10% 14.78%

‐5% 13.69% 15.86%

0% 14.31% 17.11%

5% 14.96% 18.55%

10% 15.66% 20.27%

15% 16.39% 22.38%



12.3.4 Following are the different scenarios and how Project IRR are affected due to change in Sale Price of Land and change in Project Cost simultaneously:‐

Change in Sale Price

14.31% ‐15% ‐10% ‐5% 0% 5% 10% 15%

Change in

Project Cost

‐15% 17.92% 18.85% 19.85% 20.93% 22.10% 23.36% 24.72%

‐10% 15.79% 16.56% 17.38% 18.26% 19.20% 20.20% 21.28%

‐5% 14.03% 14.68% 15.37% 16.09% 16.87% 17.70% 18.58%

0% 12.54% 13.10% 13.69% 14.31% 14.96% 15.66% 16.39%

5% 11.25% 11.74% 12.25% 12.79% 13.35% 13.95% 14.58%

10% 10.13% 10.56% 11.01% 11.48% 11.97% 12.49% 13.03%

15% 9.13% 9.52% 9.92% 10.34% 10.77% 11.23% 11.70%



CHAPTER 13

SUSTAINABILITY

The success and sustainability of any project hinges around the following components:‐

a) Stake Holder Commitment b) Economic Viability & Operational Sustainability c) Social Impact & Support d) Environmental Sustainability e) Energy Conservation

13.1 Stakeholder commitment

The key stake holders of the project are:‐ a) Local Population b) Consortium Members c) Managing Team d) Constituent Units e) Government of Tamil Nadu f) Government of India

13.1.1 Local population: The local population benefits hugely in terms of employment generation for

both unskilled and skilled section. The EMC would also enable many to upgrade their skills, improve quality of life and enhance opportunity for local vendors. The EMC is part of an integrated industrial park with other clusters for food processing, textiles, MSME, IT / ITES, health care, Knowledge Park amongst other components, which would provide immense opportunities for the local population to enhance their socio‐economic status. The external support infrastructure would improve considerably and improve transportation in the area. Considerable corporate social responsibility programmes are planned for the local area, which includes urban forestry, educational aids, health care, medical infrastructure and free drinking water facilities. A number of outreach programmes are being planned to sensitize/inform the local population of the advantages of the EMC. The local population is fully supportive of for setting up the park and is in anticipation of its completion as per stakeholder meetings conducted with them. The Tahsildar has given no objection certificate to upgrade the area to an industrial one.

13.1.2 Consortium members: The consortium members are fully committed to developing and managing the EMC. They bring their vast experience in governing, managing and establishing complex large scale projects and are anxious to start the development. The consortium members have fully agreed to raise the capital for development as per financial closure. The MoU is already in place binding the common objectives and roles. The debt component of the financial closure is being made available through the good will of the consortium members. The consortium is also committing upfront of the 2.5% of development cost that needs to be collected from the constituent units. The land has already been procured by the Chief Promoter and its affiliate. Once



the DPR is approved, governing policies for the EMC would be laid down which would include sustainable development, social upliftment, energy conservation, water usage, land use planning, waste managementetc. One of the consortium members is the Electronic Industries Association of India (ELCINA), an industry association dedicated to development of Electronic Industry in India. The association is also on the board of SPV and is the guiding force in the proposed EMC.

13.1.3 Managing team: The managing team consists of highly qualified and eminent people whose experience would be of great benefit to the park and are committed professionals with large project experience. Write up on the management team is available under Chapter 8, Management Arrangements. At this stage itself, the following actions have been taken even before the final approval of this DPR which reflects the commitment of both the consortium members and the managing team:‐

a) A reputed branding agency has already been hired and is on the job of creating a brand for the EMC. The website www.prime641.com has been uploaded and a logo for the Industrial Park has been created.

b) The Management team is already in discussions with leading companies like E&Y, KPMG, ASIPAC etc. for the promotion of the EMC.

c) Some of the major prospective players have been contacted for setting up units in the EMC include Alstom Transport , France, Blue Star India Ltd, Chennai, Assetz Property Group, Bengaluru & M/s. Maxworth Consumer Products, Hyderabad. The team is already in the lookout for a reputed implementation agency for the development of the project. Only contractors of repute will be employed. A monitoring committee is being set up by the Chief Promoter to monitor the project.

d) Marketing activities carried out are mentioned in Chapter 7, Ongoing Initiatives.

13.1.4 Constituent units: Post development of the EMC (being considered at the construction stage), the board of the SPV will have 7 members out of a total of 12 members decided as per the Consortium MoU, from the constituent units. Along with the Electronic Industries Association of India, they will have an absolute majority in the running of the EMC. These members would represent the constituent units and will strive to leverage the synergies available in the EMC. They will also promote and support policies on business improvement, social development, environmental conservation and energy conservation.

13.1.5 Government of Tamil Nadu: The Government of Tamil Nadu has undertaken Electronics Manufacturing as a core sector to be developed. This EMC supports the State’s initiates in developing the electronic manufacturing eco system. The State is in the process of developing an electronics policy to support the industry. The State is already committed to this Industrial Park vide the MoU signed with the Chief Promoter. Moreover the State’s commitment to the project has been confirmed vide a letter issued by the State and submitted to DeitY during the initial application.

13.1.6 Government of India: The Government of India has launched a number of Policy initiatives and

Strategies to promote Electronics Manufacturing in the country, which includes creation of National Policy on Electronics and under it the EMC Scheme, the MSIPS scheme and PMA and in addition various fiscal incentives, as mentioned in Chapter 1, Context/Background to this report. This is a



priority sector for the Government, in principal approval has been granted by the Government for this EMC which reflects its commitment.

13.2 Economic viability & operational sustainability

13.2.1 Economic viability: The project IRR is 14.21% and the Equity IRR is 16.94%. The NPV is Rs 644 Lakhs and Equity NPV is 1208 Lakhs. IRR for the project remains attractive at a number of scenarios which includes change in project cost and change in revenues up to 15% up or down. The details are given in Chapter 12, Financial & Economic Analysis.

13.2.2 Operational sustainability: Operations and Maintenance of the infrastructure is planned through the following revenue streams:‐

a) Operations & Maintenance of Common Infrastructure: The operations and maintenance of

common infrastructure is being carried out by charging the constituent units a % of Capex as shown in the Table below:‐

Basic Development Boundary wall, internal roads, street lighting, external storm water drainage. 3%

Essential Services Government support office, water treatment plant, sewage lines / treatment, waste disposal / recycling/ water harvesting, Electricity substation/distribution, backup power plant, warehousing 5%

Government Regulatory support/services

Entry/ exit, Security , time office & government support offices 3%

Landscaping (green area)

green area development @ Rs.500/sqmtr 8%

b) Long term maintenance & replenishment: For replenishing and major maintenance of infrastructure Rs 125/square meter of occupied area per constituent unit is being charged once in every 3 years starting from operational year of the EMC.

c) Both the above conditions will be incorporated in the initial agreement between the SPV and

the constituent units.



13.3 Social impact & support:

The impact on local population is very positive and there is complete support from the local population for the project.Apart from employment generation and local infrastructure development a number of corporate social responsibility initiatives have been planned.

13.4 Environmental sustainability:

A detailed environment impact assessment has been carried out for submission to the relevant authorities. A number of initiatives have been built into the master plan asmentioned below to ensure environmental sustainability: a) The Master Plan complies with the guidelines issued by Department of Town and Country

Planning, GoTN and the Ministry of Environment and Forests, Government of India. b) Provisions of the National Building Code and prudent engineering practices have been followed

in preparing the Master Plan. The Master Plan follows the zoning concept for meeting the statutory norms of planning, to minimise the impact of pollution.

c) The EMC has been planned as a ZERO‐DISCHARGE self‐sustainable one. d) The EMC will obtain a ‘green certification’. e) STPs and ETP are planned in the EMC for treatment of waste water and effluents. f) A green bin system to segregate waste is proposed. g) Details of green initiatives are given in Chapter 4, Project Components, Para 4.5.

13.5 Energy conservation: a) During construction, local and low energy consuming materials with high recycle value content

shall be used. b) Only energy efficient transformers will be installed. c) The streetlights along the roads in the entire campus will be powered by solar energy.



CHAPTER 14

CORPORATE SOCIAL RESPONSIBILITIES

14.1 Introduction

Corporate Social Responsibility is a management concept whereby companies integrate social and environmental concerns in their business operations and interactions with their stakeholders. CSR is generally understood as being the way through which a company achieves a balance of economic, environmental and social imperatives while at the same time addressing the expectations of shareholders and stakeholders. In this sense it is important to draw a distinction between CSR, which can be a strategic business management concept, and charity, sponsorships or philanthropy. Even though the latter can also make a valuable contribution to poverty reduction, will directly enhance the reputation of a company and strengthen its brand, the concept of CSR clearly goes beyond that.Promoting the uptake of CSR amongst infrastructure and industrial projects requires approaches that fit the respective needs and capacities of these businesses, and do not adversely affect the economic viability. A properly implemented CSR concept can bring along a variety of competitive advantages, such as enhanced exposure to industries and markets, increased sales and profits, operational cost savings, improved productivity and quality, efficient human resource base, improved brand image and reputation, enhanced customer loyalty, better decision making and risk management processes.

14.1 Vision

AEEPPL’s vision is to move beyond compliance and engage in actions that appear to foster social good, beyond the interests of the company and by not just satisfying law requirement. To actively bestow to the social and economic development of the communities surrounding the EMC, thereby aiding in building a better, sustainable way of life for the economically weaker sections of society and contribute to the betterment of the climate.

14.2 On‐going activities carried out by Chief Promoter:‐

KESHRI CHAND PUNAM CHAND SETHI CHARITABLE TRUST has been established, which is a family and private charitable trust registered in Guwahati, Assam. Initiated by the Chief Promoter under the visionaries; the Late Shri.PunamChandSethi, Founder and Mathrushree Smt. MainadeviSethi, Chief Patron, various social welfare works are being conducted towardsproviding free medical support todisadvantaged communities in India.



14.3 Milestones achieved:‐

Over the years, the above trust have contributed to many worthy causes, be it an artificial limbs camp, eye camp, providing educational assistance to poor girls and providing help to the underprivileged sections of the society, to name a few.

14.4 CSR initiativesin EMC

Besides the above‐mentioned CSR activities, AEEPPL proposes to carry out the following:‐ 14.4.1. Urban forestry:‐ In order to combat the climate change, AEEPPL proposes to plant about 1 Lakh

tree saplings during the construction period in the areas surrounding the EMC by employing local personnel as public relation officers who will be equipped with all the infrastructure for coordinating and maintaining the trees for next 3‐4 years.

14.4.2. Educational aids:‐ AEEPPL proposes to adopt a school each in the Panchayat limits of Kuppanur and

Akkarisengapalli village adjacent and support the school children by providing uniforms, books and providing financial assistance to the economically weaker sections and as Swatch Bharat initiative, toilets and wash rooms will be constructedin schools apart from compound walls and class room flooring.

14.4.3. Healthcare camps: ‐ Regular healthcare camps will be set up in and around the area surrounding

EMC for the betterment of locals by engaging panel of doctors including eye, ENT and general physicians & surgeons with mobile clinic. Food and water will be supplied during the camp along with medicine in such camps.

14.4.4. Medical infrastructure: ‐ AEPPL would provide 2 ambulance vans each with ICU facilities on the

wheel for 3 hospitals in the Kuppanur and Akkarisengapalli villages adjacent to EMC for emergency purpose.

14.4.5. Drinking water facilities:‐ AEEPPL proposes to set up 2 RO plants each in Kuppanur and

Akkarisengapalli village to cater to the need of pure drinking water to the locals, free of cost. 14.5 Budget allocation

In order to meet the expenditure of the proposed CSR activities, AEEPPL has made a provision of about Rs. 83 lakhs in the project cost estimate of EMC during the construction period of EMC and subsequently adequate amount will be set aside towards CSR activities during the operation and maintenance of the EMC.

Documents

EMC AT ANNUR, COIMBATORE FINAL DPRenvironmentclearance.nic.in/writereaddata/FormB/TOR/PFR/13_Nov... · One of the important objectives of the NPE is to achieve a turnover of about