Free trade warehousing zones to be built in India

Mumbai: Supply chain services company Arshiya International Ltd will invest Rs 3,000 crore for construction of free trade warehousing zones in India and the West Asia and a rail link in India, announced Mr Ajay Mittal, Chairman.

IN Two phases

The expansion will happen in two phases, with Rs 1,850 crore being invested in the first phase. It will include three free trade warehousing zones in Sai village near JNPT, Mumbai on 170 acres at Rs 750 crore, near Delhi on 210 acres at Rs 650 crore and Sohar Port in Oman on 122 acres (five lakh sq metres) at Rs 150 crore, according to Mr Paul W Bradley, President.

A railway link connecting Delhi and Mumbai will also come up at a cost of Rs 350 crore with investment in rakes for operation of container trains.

The land required for the FTWZ near JNPT is near completion while the acquisition of land in Delhi is under process.

These projects will resume construction next month and be completed by 2010, said Mr Mittal.

Funding

The company has raised Rs 97 crore through private placement and filed a qualified institutional placement for Rs 350 crore, the issue of which opened on Wednesday.

Internal accruals will bring in the rest of the funds, he said.

“The FTWZ will enhance Exim trade in India, as we expect merchant traders, retailers, steel and oil companies to use our warehouses to store and refurbish imported goods to re-export them at a profit,” he said.

Arshiya is targeting the retail sector and might get into cold chain management of food items by next year, he added.

An FTWZ enjoys all advantages a special economic zone is entitled to, including hubbing, kitting, re-engineering of products with tax benefits and a hassle free environment.

The company has formed a Global Advisory Board including Prof G Raghuram, Indian Institute of Management and a Board of Director of the company, Dr Frank-Jurgen Richter, former Director World Economic Forum (Asia Pacific) and Mr Richard Taffet, a strategic advisor, who were also present during the announcement.

Arshiya reported a topline of Rs 160 crore in the September quarter with a net profit of Rs 15 crore.

The company’s scrip on Wednesday closed at Rs 347.35 on the BSE up two per cent as compared to the previous day’s close of Rs 340.55.