Editorial Charter

Do State Policies Fall Short Of Promises Made In MoUs With Aircraft Manufacturers?

Stray cows and buffaloes can be seen loitering near the entrance, and a large sewer nearby frequently overflows, causing dirty water to accumulate around a plant that was once touted to be a state-of-the-art factory rolling out aircraft

India's first private sector aircraft manufacturing plant is being set-up in Vadodara, Gujarat, with an investment exceeding Rs 25,000 crore. It is expected to create thousands of jobs and boost Gujarat's economic growth. However, the situation on the ground belies the grandiose expectations of the project.

Stray cows and buffaloes can be seen loitering near the entrance of the sprawling plant.

A large sewer nearby which frequently overflows, causing dirty water to accumulate, does not exactly add to the beauty or hygiene levels of what was once touted as a state-of-the-art factory rolling out aircraft. 

Despite repeated appeals to the municipal corporation by the company, no action has been taken on these basic issues till date.

Even the road leading to the plant has been left rough and unpaved by the corporation, forcing the company to spend Rs 3.5 crore of its own money to construct a new one.

Why Is This Factory Crucial?

Globally, only two companies manufacture passenger aircraft in large numbers - America’s Boeing and France’s Airbus. Of course, several other aircraft manufacturers make smaller and fewer planes. 

These include Brazil's Embraer - the maker of executive jets, India's HAL- known for its 19-seater Do-228, China's COMAC which makes the 90-seater ARJ-21, and Japan's Mitsubishi has plans to launch the Spacejet, a regional passenger jet - among others. 

Ahead of a Vibrant Gujarat Summit, the government had sent a team of several officials, including then Aviation Secretary and Senior IAS Officer Hareet Shukla, to countries such as the US, France, South Korea, and Japan to attract foreign investment in the aircraft construction sector to Gujarat.

Based on the responses from many multinationals to this team, industrialists were assured that approvals for starting a company or a factory in Gujarat would come swiftly.

At the Summit, the government signed a Memorandum of Understandings (MoU) with the Tatas and Airbus, following which, the state provided 60 acres of land inside Vadodara's Harni Airport on a 10-year lease for an aircraft plant to this consortium.

After the lease ends, the government is expected to allocate 100 acres of land in Dholera too for an expansion programme.

Currently in India, the state-run Hindustan Aeronautics Limited (HAL) is the only company which manufactures small aircraft and larger planes for the army.

The plant being set up in Vadodara will initially produce the C-295 transport aircraft for India's defence forces. The Centre has already placed an order for 40 planes with the company.

These cargo-transport aircraft will be used to move defence supplies. After this, passenger aircraft manufacturing may also be taken up in the future.

The government has claimed that the aircraft plant would accelerate Gujarat's economic development as numerous small and large components and raw materials would be required to feed it, benefiting domestic manufacturers and local vendors manufacturing those.

However from the looks of it, the plant is getting lost in the maze of red tape which surrounds various clearances, even after being promised the sky when it was being conceived.

Single Window System: ‘A Myth; Delays In Every Approval Process’ - Company Official

A senior company official, speaking on condition of anonymity, said, “The work on the plant started on April 1, 2022, and was supposed to be completed within a year, with aircraft production beginning in 2024. The single window system, however, turned out to be just a myth."

He explained that the company has been "facing difficulties in obtaining small and large approvals, with delays in every process".

As a result, the plant has not been able to start functioning fully. 

"Before the Prime Minister came to lay the foundation stone of the plant, all approvals were quickly granted. However, after that, it was a nightmare to get approvals from the Vadodara Municipal Office," the official added.

The plant was supposed to be operational within a year, with aircraft production slated to begin in 2024. However, with delays and significant decisions on hold, it seems unlikely that the plant would become operational even this year.

The official said, “In Gujarat, the hospitality is excellent. You are welcomed with tea, snacks, and meals in air-conditioned offices. But when it comes to approvals, it is a different story. We are investing nearly Rs 250 crores on airport land. After the plant starts, about 10,000 vendors will benefit, and 30,000 to 40,000 people will get employment due to the plant."

On September 15, a team from Airbus is scheduled to visit the factory, and officials are hoping that the bureaucratic wheels will turn before that, or else the scene that will greet them may not be one that will leave a "good impression" with the visiting top brass.  

“The Airbus team is coming. We have requested the Vadodara Municipal Corporation to clean the area and create a garden, but the administration remains unresponsive. They don’t even bother to cover the sewer," lamented the official.

What Government Officials Say

When queried about the alleged delays and unresponsiveness on the VMC's part, Industry Commissioner Sandeep Sangle stated that the approval process for the project is proceeding rapidly from the government's side.

Sangle underlined that the plant will start soon and accelerate Gujarat’s economic development. Attempts to contact Dhaval Patel, another senior IAS Officer, who is handling the aviation department, were however unsuccessful.

All of these follow efforts to strengthen relations with France’s French Aerospace Industries Association (GIFA) at the Vibrant Gujarat Summit -2024 Road Show in Paris.

In the Paris Road Show, top officials from the state met several stakeholders in the French aerospace, space, and defence sectors, and discussed the prospects of aviation-related production, MRO (Maintenance, Repair, and Overhaul), and aircraft leasing in Dholera SIR and GIFT City.

One can only hope that the problems faced by the investors will be solved at the earliest so that future interest among potential entrepreneurs in the 'Make in India' exercise stays alive.

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