Locational advantages of the world's cheapest car manufacturing plant.

Ratan Naval Tata is a living legend of ‘businessman par excellence’. In an interview to the NDTV on inflation and his viability of making the common man’s dream car at rupees one lakh, he aptly remarked: “a promise is a promise….” He is a man of corporate ethics and never does business at the cost of welfare of either his employees or others. His ultimate decision to withdraw the Nano plant from Singur (West Bengal) has proved to be ‘West Bengal’s envy, Gujarat’s pride’.

Let’s find out the benefiting factors for his ‘Nano’ project at the new site, Sanand (near Ahmedabad in Gujarat, India). Of the all the factors of industrial location, the Non-geographical factors (viz., capital; labour; transport and infrastructure; government policies and patronage; market etc.) have outwitted the Geographical factors (viz., land; raw material; water resources; power and climate) in this case.

Land: Mr. Narendra Modi as the Chief Minister of the state has made the land access processes easy and speedy for allotment to the company. Though a PIL has been submitted in the Gujarat High Court, he seems to be prepared enough to handle the situation.
Raw Material: since the Ahmedabad-Vadodara industrial region has many engineering and motor / tractor manufacturing plants, the automotive flat glass; control meters; electrical wiring; plastic components; rubber and sheet metal parts; bearings, tyres and machined components making companies will prove to be a huge boost as vendors and suppliers for the plant.
Water: the recent trend of industrial location indicates strong influence of the proximity of water resources. Overall, as per an estimate the plant will require only 15 MLD of water with 10 MLD discharge.
Power: this may be a minor problem for the plant as the region is mainly dependent on thermal power. But, the upcoming Kakrapara nuclear power plant will improve the situation in the industrially advanced state of Gujarat. However, the plant’s power requirement is estimated to be 10 MW.
Climate: has no role to play in a non-agro based industry.

Capital: Gujarat is a highly capitalized state of India and it is perhaps one of the reasons for the project to be shifted to this state.
Further, in no time, Gujarat is all set to gain a massive 40 per cent of the $100 million investments flowing through Japan Bank for International Cooperation (JBIC) for Delhi-Mumbai Industrial Corridor (DMIC) which will be the mother of all investments in the state.
Labour: though the state itself has a huge and qualitative population base, it is backed up by a highly populous hinterland. Besides, the Tatas have already announced their intention to train people locally for their requirement.
Transport and Infrastructure: the state has an efficient network of road-rail-water and airways. The Kandla port in the state is the only port which has ‘free trade zone’ facility in India.
Government patronage and policies: the plant enjoys this very much from the very initial stages in the form of invitation into the state by the CM himself; speedy land access process; tax exemptions etc.

The world’s cheapest car( each car of Rs. 100,000 or USD 2080) manufacturing plant is certainly bringing manifold socio-economic changes not only at the site but in the whole of the state just the way Maruti Udyog Limited has brought it in a sleepy rural town of Gurgaon in Haryana (India) about 25 years ago.

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