Pune Shifts To Top Gear As Automobile Hub

The global financial meltdown only underscored the importance of cost control and cost effectiveness for auto manufacturers

The metamorphosis of Pune city over recent decades from a verdant, easy-paced abode of choice for retirees to a bustling metropolis has been complete and today, although it is a major information technology hub, the automotive sector occupies pride of place as the prime mover behind the rapid development of Pune and surrounding areas.

Detroit of India

The proliferation of automobile manufacturing units and component suppliers that populate the landscape of outer Pune, particularly Pimpri-Chinchwad, Chakan and Talegaon areas have increasingly earned it the sobriquet of being the ‘Detroit of India’ and it continues to elicit interest and attract investments despite challenges from the newer auto hubs dotting outer Chennai and Gurgaon near Delhi.

The entry of the heavyweights of Indian automobile industry — Tata Motors and Bajaj Auto — in the 1960s resulted in and subsequently escalated the mushrooming of allied industries that catered to the outsourcing requirements of these principals. While the first original equipment manufacturer (OEM) was Mercedes-Benz in the 1990s through a joint venture with the Tatas and later on its own, others followed suit but only in trickles.

However, in this millennium, global heavyweights like General Motors, Fiat, Volkswagen and more recently India’s largest utility vehicle maker Mahindra & Mahindra (M&M) have committed large investments in this region and their entry seems to have opened the floodgates for auto investments here.

The global financial meltdown only underscored the importance of cost control and cost-effectiveness for auto manufacturers and further re-affirmed their decision to move to cheaper manufacturing locations available in India, particularly as quality was not going to be compromised.

Today, the Pune automobile landscape includes the ‘who’s who’ of Indian and increasingly international automobile majors.

Tata Motors is the largest followed by Bajaj Auto, Force Motors, Mahindra Two-Wheelers, Mercedes-Benz, GM, JCB construction equipment, Volkswagen, M&M, Premier Motors and Fiat.

The new projects include the Fiat-Tata joint venture at Ranjangaon with a proposed investment of Rs.4,000 crore, GM’s Rs.1,400-crore investment with a further Rs.900-crore expansion, Volkswagen’s project of Rs.3,800 crore, Mercedes’ Rs.250 crore investment and Mahindra & Mahindra planning a huge Rs.5,0000-crore investment by 2012. Bajaj Auto proposes Rs.300-crore investment in two-three wheelers and a further Rs.1,000-crore investment in the car plant.

Among large auto suppliers are Cummins Engines which set up shop in the 1960s with Kirloskar and later alone, Kirloskar Oil Engines and Bridgestone’s new Chakan plant for tyres with an investment of Rs.2,600 crore.

Commitment by MNCs

In the last 18 months, large multinational auto component suppliers like ZF Group of Germany have committed around Rs.50 crore, Prembo of Italy is setting up a Rs.100-crore disc brakes facility and Norma of Germany plans to invest euro 3 million (about Rs.18 crore).

Pune’s USP

In addition to the auto OEMs (original equipment manufacturers), Pune has a range of Tier-1, Tier-2 and infrastructure suppliers, including Bharat Forge, among the top forging companies in the world and Sandvik’s large cutting tools facility.

PCMC To Open Helpline For Complaint Redressal

PUNE: Next time you don’t get enough water in your tap, all you may have to do is dial a number, as the Pimpri-Chinchwad Municipal Corporation (PCMC) will soon open a helpline to address the complaints of citizens like you.

Pravin Tupe, joint city engineer, PCMC, said, “Initially, the system will only accept complaints related to water supply. Subsequently, the helpline will be extended to all 41 civic departments.”

The PCMC has around 1.15 lakh water consumers in its jurisdiction. Complaints regarding low pressure, dysfunctional water meters, leakage and bills can be registered. The helpline will have an advanced voice recorder (AVR) system and citizens will get the choice of three languages, Marathi, Hindi and English, for processing his/her call, said an official.

“The caller will have to feed his water connection number and contact number before registering his complaint. He will be given a unique complaint number and his complaint assigned to the junior engineer concerned. The caller will also be given the details of the junior engineer and a time period for redressal. Once the problem is rectified, the complainant will be informed and the system will update the status,” said the official.

The helpline, estimated to cost the civic body Rs 12.75 lakh, will be sourced out to a private party. A proposal, for giving direct contract to create the software, programming, development and upgradation of the citizens grievances redressal helpline, will be tabled before the standing committee next week.

The Real Estate Magic of Integrated Residential Projects

When you are setting out to purchase the home you always dreamed of and saved for, you obviously wanted something more than just an orphaned, anonymous set of walls in some congested city center. The problem is, that’s all that most residential projects in India offer these days. There is a lot more to the perfect home than good construction, layout and fittings – a residential property needs supporting social and physical infrastructure to become a suitable home. Moreover, the beleaguered city dweller’s heart yearns for the sight of greenery, open spaces and fresh air.

After all, we want our children to grow up in better conditions than we possibly experienced at their age…

woodsville_big

In Pune, integrated townships have been seen as the answer to these requirements. However, land constraints, zoning laws and the budgetary considerations that govern property buyers in many areas often do not make the integrated township model feasible.

A more practical and feasible alternative is Integrated Residential Projects. Like integrated townships, this more compact and serviceable model offers home buyers everything they need for a comfortable and healthy lifestyle. Children have enough room to play in, and both they and their parents are free from the stress, noise and pollution of central urban life. Such projects have schools, shopping and entertainment facilities, healthcare and easy access to public transport.

Also (very importantly) they are a boon to people who wish to live in a non-urban environment while attending to their jobs in the workplace catchments of the city. They get a dream location, excellent infrastructure and a lot more.

Residential real estate investors, on their part, can capitalize on the higher demand – and therefore the higher ROI (returns on investment) that such properties offer. The higher investment potential of homes in integrated residential projects stems from the fact that they are self-sufficient and self-sustaining. A direct outcome of this is that the resale value of such properties is as good as immune to market volatility. Because of the diversified nature of such projects, they represent a very low risk to property investors, even while they benefit from the larger upside potential despite low entry costs.

Builders who cater to the demand for integrated residential projects face quite few challenges. After all, they have to provide the advantages of integrated townships while having to forgo the considerable incentives that the Indian Government offers for the development of larger townships. Therefore, the initial capital required is extremely steep – right from land acquisition to the providing of physical and social infrastructure.

The integrated residential project concept is just beginning to emerge on the Indian real estate landscape. One of the areas where it has been successfully implemented is Pune’s sister city – the Pimpri Chinchwad Municipal Corporation. One of the primary reasons for the success of the integrated residential projects in the PCMC areas of Pradhikaran and Ravet is the fact that these are located very close to vital workplace hubs such as the MIDC and Hinjewadi, Pune’s software hub. This, coupled with the advantages of having ‘everything inside’, has contributed to the demand for homes in such projects.

Anil Pharande is President of CREDAI PCMC and Chairman of Pharande Spaces, a leading construction and development firm that develops ultra-modern integrated residential projects in the PCMC area of Pune, India.


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Finolex Industries Selling Pune Land To Raise 4 Billion Rupees

Finolex Industries Ltd., India’s biggest maker of pipes made of polyvinyl chloride, surged to its highest in almost three years after the company said it expects to raise about 4 billion rupees ($86 million) selling land.

The company revived its plan to sell 78 acres (31 hectares) of industrial land after an increase in real estate prices, said P. Subramaniam, chief financial officer, said in an interview. Finolex had in 2008 proposed selling the property, he said.

The land sale will help Finolex improve its cash flow, said Tejas Doshi, vice president of equity research at Sushil Financial Services Pvt. The company, which reported a 67 percent drop in profit in the three months through June, also plans to spend 800 million rupees to build a new factory, Subramaniam said by phone today.

The land sale will help “improve the balance sheet,” Mumbai-based Doshi said. “It will also help their expansion plans.”

Finolex will raise 500 million rupees by selling non- convertible bonds to build the plant and will fund the balance from its profit, Subramaniam said. The company hasn’t “finalized” the land sale yet, he said.

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PCMC Pipeline Contractors To Level Dug Up Roads At Own Cost

PUNE: The water supply department of the Pimpri Chinchwad Municipal Corporation (PCMC) has put a clause in tender bid documents making it mandatory for contractors to level the road after the pipelines are laid.

Earlier, the contractors would lay the pipes on roads and refill the trenches with uneven murum, resulting in inconvenience for motorists. Later, the asphalting work of these rough patches was given to new contractors for an extra price. Now, the one who lays the pipes will have to level the road with tar.

Ambadas Chavan, additional city engineer and chief of water supply department, PCMC, confirmed that such a clause has been included in the tender document.

Joint city engineer Pravin Tupe said, “Earlier too the PCMC used to get the trenches filled from the contractor. But now it is being explicitly mentioned as a mandatory condition while inviting bids for future projects. “The tender process will be completed in two months while actual work is expected to begin before the end of this year.”

The condition has been put up in the bid document for 18 projects of the water supply department, estimated to cost Rs 6.71 crore. Of these, 12 projects are to be completed in six months and five in a year. One other project has a two-year deadline.

Sulabha Ubale, group leader of Shiv Sena corporators, said, “The contractors dig up roads and other open areas but fail to fill the trenches. Accidents occur due to uneven roads. There is no co-ordination between the water supply department and the engineering department, due to which there is delay in reasphalting work of roads. The PCMC should ensure that the contractor who has dug up the roads for pipelines fills the trenches and asphalt the roads. ”

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