Patna, June 22: Reservation of land is the latest lolly out of the Bihar industries department basket to attract investments to the state.

In a first-of-its-kind move, Bihar Industrial Area Development Authority (Biada), an arm of the department, has offered Hero Cycles Limited 12 acres of reserved land in Bihta industrial park, 35km southwest of Patna, for two years to set up a 1-million cycle manufacturing unit. Its co-chairman, Pankaj Munjal, laid the foundation stone for the factory last Friday.

An industries department official told The Telegraph: “Reserving a land means locking it for a certain period of time. The land could even be kept vacant for two years or more according to the agreement, with other investors waiting. That is a risky proposal but the department wants to give it a try to attract investors.”

Senior department officials said the Hero Cycles example could be extended to other investors as well but only after their proposals are carefully examined. Biada sources, however, admitted that providing reserved land to all was difficult.

The official said: “Though Biada is slowly acquiring plots, a tough proposition in Bihar, land is scarce with the authority at present. A policy is being framed to govern the setting up of private industrial parks. The land in different industrial areas of the state is scarce.”

Biada managing director (MD) Deepak Kumar Singh said: “We didn’t provide them (Hero) with reserved land only because they are a big company coming with investment. Bicycle companies need ancillary units for proper functioning. The Hero factory would take up seven acres. It has assured us that a few ancillary units would come down from Ludhiana to set up shop on five additional acres allocated to it in Bihta. At their Ludhiana headquarters, ancillary units, manufacturing bicycle spare parts, have become a sort of cottage industry offering plenty of jobs. But in Bihar, the concept is new. Developing the same as a cottage industry will take time.”

The MD added: “The department would surely consider requests from other investors to extend similar offers. But approval would be given only after the proposal is carefully studied. All kinds of companies do not need such ancillary units. If any other investor comes and requests for reserving land in addition to that required for the plant, the department would surely consider.”

Avon, another major player in bicycle manufacturing, has not made a request for providing land to set up ancillary units, sources said.

“Avon has been provided with 2.5 acres in Hajipur industrial area for its manufacturing plant, which would be set up within six months. However, until now, they have not approached the state government for providing reserved extra land for setting up of anci- llary units,” said another Biada official.

INDUSTRY LURE

Industries minister Renu Kumari lays the Hero Cycles foundation. Telegraph picture

Reserved land
Refers to locking a plot for a certain period of time

Risk factor
Industries department or Biada cannot take any step if the company holding the plot decides to keep it vacant for the number of years agreed in the agreement