A Tata Motors spokesperson stated, “The investor-friendly environment created by the Government of Gujarat (GoG) encouraged Tata Motors to set-up its manufacturing plant in Sanand, with a long-term vision to make it one of the leading automotive hubs, further enabling Gujarat to contribute to the prosperity and growth of India. Given the scale of the project and its potential to drive growth in the state, the GoG offered Tata Motors an incentive package in the form of a loan (not a grant), which is to be repaid to the State Government as per the Loan Agreement executed. The loan given to Tata Motors from the GoG is from taxes paid by Tata Motors. Until now, the State Govt. has given a loan of Rs 584.8 crore to Tata Motors.”
Quoting a Business Standard article that stated that sellers had stopped striking orders for the Nano, Gandhi had tweeted ultimate week – “PM’s pet “Make in India” project just died. Rs 33,000 crores of Gujarati taxpayer money turned to ash. Who is accountable?”
Among the advantages accorded to the Tata Nano challenge, the main one is within the shape of a comfortable mortgage at zero.1 in keeping with cent easy pastime in keeping with annum for 330 in keeping with cent of the primary segment funding of Rs 2,900 crore deliberate by way of Tata Motors. An further situation of capping the volume as much as the gross Value Added Tax (VAT) and Central Sales Tax (CST) payable to the state executive on the sale of the Nano automotive and its portions and parts from the date of graduation of the sale of the primary Nano automotive was once additionally incorporated. The mortgage could be repayable in per thirty days instalments ranging from the 21st yr of the graduation of sale of the primary Nano.
A state executive respectable (who had labored carefully on drafting the state give a boost to settlement with Tata Motors) had previous clarified to Business Standard that whilst the preliminary working out was once to increase a comfortable mortgage of the volume equivalent to 330 in keeping with cent of the preliminary funding (or Rs 9570 crore), it was once later made up our minds that it could be capped to an quantity equalling to 230 in keeping with cent of the preliminary funding by way of the corporate (or Rs 6,669 crore). This came about someday round 2011-12 when the corporate and the state executive had been negotiating whether or not the gross or the web VAT quantity is to be thought to be when the state executive extends the comfortable mortgage.
Tata Motors has no longer been in a position to encash on the sop prolonged because the Nano gross sales by no means picked up. If the plant were generating 250,000 Nanos a yr, the convenience would have labored out to Rs four,000 in keeping with automotive.
The corporate thus clarified on Thursday that to this point just a mortgage of Rs 548.eight crore was once dispensed to the corporate.
The state executive didn’t prolong the equivalent sops to the opposite fashions now being made on the plant – the Tiago, Tigor and so forth. Nano manufacturing too has nearly stopped – simplest 74 Nanos had been produced in October this yr.
The Tata spokesperson additional added, “Since the status quo of the Sanand plant, there was a spurt in financial job and enlargement in employment (direct and oblique) inside the State, making Gujarat one of the important thing auto hubs inside the nation with massive employment era. The challenge has additionally given upward thrust to capital investments which has additional resulted within the construction of incidental commercial actions and employment era in small and medium scale industries.”