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Old 9th September 2014, 10:52   #1
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Default Maruti Suzuki asked to halt construction of new R&D unit

The Government of Haryana has asked Maruti Suzuki to halt the construction of an upcoming R&D facility at Rohtak. The new facility, which was a Rs. 3,500 crore project, was to be the first unit built by Suzuki Motor Corporation, Japan to develop and test cars for India and global markets. It was to be built over an area of 600 acres and expected to be operational by next year.

The state Government claims that the country's largest carmaker in terms of sales did not obtain the necessary environmental clearance before beginning the construction work on the facility. The previous Government of India had introduced a policy, which makes it mandatory for companies to seek environmental clearance for construction of any facility greater than 20,000 sq. ft. in size.

On August 9 at a meeting held by the PMO industry leaders present at the meeting had stressed that the requirement constitutes a misinterpretation of a clause from the environmental impact assessment (EIA) rules of 2006, which were aimed at keeping a check on residential building projects. Top government law officers have earlier opined that this clearance is not necessary in the case of industrial projects. The implication of the rule would mean that even a medium-size unit being built over six acres of land would need a prior environmental clearance before commencing construction. This introduces an additional delay of at least 18 months for investments. This had led to confusion in the understanding of the policy.

Maruti Suzuki has been obtaining the necessary clearances for air and water pollution and hazardous waste. It had forwarded an application for environmental clearance for the construction in February 2013 even though it was not convinced about the requirement of this clearance. The company went ahead with the construction of the new facility and in March 2014, the state government decided to initiate action against it under the Environment Protection Act of 1986 for commencing construction without obtaining clearance.

In May 2014, the Delhi High Court directed the Government of Haryana not to initiate any criminal action against Maruti Suzuki. The High Court also directed the company to obtain a post-facto environmental clearance for the construction of the project. The Haryana State Environmental Impact Assessment Authority has filed an appeal against this verdict and as a decision on the appeal is yet to be pronounced, Maruti has been asked to stop all construction or operational activity.

Source: Economic Times
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Old 9th September 2014, 12:21   #2
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Default Re: Maruti Suzuki asked to halt construction of new R&D unit

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Originally Posted by Aditya View Post
The Government of Haryana has asked Maruti Suzuki to halt the construction of an upcoming R&D facility at Rohtak.
Ridiculous. Let's see how quickly the Modi government steps in, if at all. The "Make in India" speech is on test here, and Maruti should immediately make this a very high visibility discussion with the government. True test of whether the GoI is willing to walk the talk.
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Old 9th September 2014, 12:30   #3
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Default Re: Maruti Suzuki asked to halt construction of new R&D unit

This is mule-headed....a classic case of bureaucracy running amok..

Without putting any political colour into the whole discussion, I think its time for industrialists to take a hard look at which states welcome private capital, and offer a transparent environment, and just move all net new investments to those locations.

And of course, the government should provide clarity on this grey area at the earliest.
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Old 9th September 2014, 12:41   #4
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Default Re: Maruti Suzuki asked to halt construction of new R&D unit

I dont think the Haryana govt is doing anything wrong. They are following the rules. But 18 months delay for getting environment clearance?
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Old 9th September 2014, 12:50   #5
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Default Re: Maruti Suzuki asked to halt construction of new R&D unit

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Originally Posted by Aditya View Post
The Government of Haryana has asked Maruti Suzuki to halt the construction of an upcoming R&D facility at Rohtak.

Source: Economic Times
Thanks for the update. But this is mainly due to misinterpretation of EIA Act of 2006. The 20000 sq.m is applicable only for residential buildings. Most of the state governments do not insist on EC for these kind of projects. But it is better to keep a close tab on the proceedings of this issue.
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Old 9th September 2014, 13:00   #6
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Default Re: Maruti Suzuki asked to halt construction of new R&D unit

This appears nothing but a sort of political gamesmanship that is being resorted to by the Haryana Government. One needs to see the timeline of this order -it comes barely a week after Modi finished his Japan trip. At the same time, this will help prove Modi's resolve to put business growth first. So, in a way, this is a blessing in disguise for the new Government to show its resolve for industrial growth.
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Old 9th September 2014, 13:19   #7
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Default Re: Maruti Suzuki asked to halt construction of new R&D unit

LOL, so 'had' to happen, wonder how the japanese companies inside Congress run states are still not-shut down!!

Would be interesting how the GOI handles this so-expected Check (chess~).

Last edited by GTO : 11th September 2014 at 14:54. Reason: Typo
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Old 9th September 2014, 13:58   #8
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Default Re: Maruti Suzuki asked to halt construction of new R&D unit

one more reason for maruti to move out of haryana. Above is a classic example of how congress has been pushing back the development of Whole country on the backburner. Days are not far-off when all the companies from all over india will move to Gujarat or some other developed states which promotes these activities. Nano case at Singur and the last turmoil at Maruti manesar plants should definitely have provided industry enough food for thought.
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Old 10th September 2014, 16:05   #9
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Default Re: Maruti Suzuki asked to halt construction of new R&D unit

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Originally Posted by kumaranna View Post
Thanks for the update. But this is mainly due to misinterpretation of EIA Act of 2006. The 20000 sq.m is applicable only for residential buildings. Most of the state governments do not insist on EC for these kind of projects. But it is better to keep a close tab on the proceedings of this issue.
Not at all. Any construction exceeding this limit need to take clearance from EIA. This is followed by Pollution control Board, National Board of Wild Life and what not. Also, this is not a state matter, it is governed by Central government (Ministry of Environment and Forests).
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