MIDC Land Allotment under Foreign Direct Investment (FDI) in Maharashtra

Foreign direct investment (FDI) is a major source of non-debt financial resource for the economic development of any country. India has become the most attractive emerging market for global partners (GP) investment due to government’s initiatives in relaxing FDI norms across sectors due to various relaxations. Land Allotment under FDI in India

 FDI Routes in India

Foreign direct investments (FDI) can be made by opening of a subsidiary or associate company in India  or acquiring a controlling interest in an existing Indian company (minimum 10% ownership stake , it is flexible in some special cases in which firm can be established with less than 10% of the company’s voting shares) or by means of a merger or joint venture. There are two routes by which India gets FDI:-

Automatic route: FDI is allowed without prior approval by Government or Reserve Bank of India. But the RBI needs to be informed about the amount of investment within a stipulated time period.

Government route: The application needs to be made through Foreign Investment Facilitation Portal, processing is done by the concerned Ministries/Departments followed by decision of the Government under the extent FDI policy.

To attract FDI in process Land allotment under FDI in India every state government gives incentives.  Government of Maharashtra offers plethora of incentives to the Foreign companies setting up their factories / manufacturing units in Maharashtra. To know in details as to how the foreign companies can make the investment in India to set up the industrial units and also the various incentives offered by the Government of Maharshtra please click here

 Maharashtra as an FDI destination

Maharashtra alone contributes 27% of total exports in India. Being the biggest contributor to India’s GDP 15%, Maharashtra has always remained in the forefront of country’s economic development.  The state attracts the highest FDI in the country;  30 % of the total FDI inflow.

According to the DIPP, cumulative FDI inflows in the state of Maharashtra during April 2000 to March 2016 stood US$ 82.62 Billion. The state government has approved 18,709 industrial proposals during 1991-92 to 2014-15.

Inline with the initiative of ” Make in India”  Maharashtra Government has launched  a scheme “Make in Maharashtra” where Maharashtra Government is providing preferential allotment of Land to Foreign Companies under FDI category & special incentives are given to the company if units are set in D & D+ zones.

One of the government organisations supporting Maharashtra’s exemplary performance & be a backbone of Indian economy is the project MIDC (Maharashtra Industrial Development Corporation) , established in 1962 with a prime objective of Prosperity to all through Industrialization.  From its inception, the corporation is continuously working on the policies with would result in Economic lift of the country be it through domestic Or International market. Many Incentive policies are timely introduced by the corporation. Progressive Government taking measures to facilitate industries in generating revenue is what the state is working at.

MIDC Criteria for Allotment of Plot under FDI

MIDC allots plots under FDI Category. The conditions and quantum of minimum FDI for qualification as FDI units for priority allotment of land is:

1. Remittance Certificate from RBI is must before Allotment & at various stages of Investment.
2. Minimum shareholding of the foreign entity should be 51%.
3. The minimum paid up equity shall not be less than 25% of the project cost.
4. The minimum investment for A, B & C area should be Rs. 20 Crs. or USD 4 million whichever is more.
5. The minimum investment for other areas (D, D+, NID & Naxal affected etc.) should be Rs. 10 Crs. or USD 2 million whichever is more.
6. For A, B & C areas the land rate per 1000 Sq.mtrs is Rs. 1 Cr. & other areas the land rate per 2000 Sq.mtrs is Rs. 1 Cr.
7. 100% of the investment should come within 2 years from the date of possession with an extension of a year if the delay is beyond control.The entire investment may be brought up front or in different stages as under:
   1. Before Allotment of land: Minimum to extent of land cost.
   2. Before approval of Building plan: Minimum 25% of proposed
   3. Before granting of OC/BCC: Minimum 50% of proposed FDI.
   4. Before commencement of project: 100% of proposed FDI.
   5. Land is allotted on priority bases inFDI, in case of default the penalty would be 25% of prevailing land premium per year after the expiry of period. Transfer of open plot will not be allotted, it will have to be surrendered to MIDC.

Classification of Industrial Areas

Maharashtra Industrial areas are divided into 5 zones A,B,C,D & D+  depending on the availability of Industrial Infrastructure.

 ASCC AS AN INDUSTRIAL CONSULTANT

ASCC is a leading Industrial Real Estate Consultant in Maharashtra is a registered Pvt and SSI (in service sector) established in 2004 with a track record of serving about 450+ industries which includes 31 Fortune 500 companies or MNCs.

ASCC with its team of highly skilled specialists provides strategic and operational support for doing business in India. The strategic support includes selection of site for setting up the industry (Acquisition of Leasehold Industrial Land under Priority Allotment (FDI), allotment through e-bidding, Resale Industrial land) and all legal property transfer formalities, and operation support includes support for obtaining all requisite consents, NOCs, permissions and licenses to establish and run the industry.  For detailed profile of For detailed profile of ASCC please Click here.

Direct Allotment of Land through MIDC under Priority Allotment:

• Providing you the complete information for decision making at your end for selection of location and site.
• Arranging site visit
• Guidance for preparation and submission of project report and application to MIDC.
• Case representation to MIDC.
• Guidance for Meeting with MIDC
• Liaison with MIDC for issuance of Offer Letter and Allotment Order.
• Arranging Survey, Demarcation and Possession of Land.
• Full assistance for execution of Agreement to lease with MIDC
• Monitoring entire allotment and transfer process.
• Any other service needed by you for procurement and transfer of Industrial land

Procurement of Industrial Land in Resale:

• Selection of Location
• Offering Industrial Properties through the database.
• Short listing and site visit.
• Meeting with the seller.
• Negotiation to decide the terms.
• Due Diligence and Title Verification.
• Structuring of the deal.
• Preparation and finalization of MoU.
• Handling entire Transfer Process.
• Any other services needed for procurement of Industrial land

Other Industrial Services by ASCC:

• In-depth study for selection of location
• Guidance for approval of RBI / Government for Funds Transfer
• All Business and Industrial approval
• Registration of MSME & LSI
• All other registration for
• MPCB Consent to Establish and Operate
• Factory Plan Approval and License from DISH
• Petroleum and Explosives License (HSD and other Class A, B, C Petroleum Products, Chemicals, Gas Cylinder Rules for Canteen/Cafeteria.)
• Contract Labour License as Principal Employer / Site Registration
• MIDC – Approvals:
  1. Building Plan Approval
  2. Provisional and Final Fire NOC
  3. Building Completion Certificate, Occupancy Certificate
• Any other permission & licenses to establish & run the industry

ASCC is One Stop Solution for services related to setting up Business and Industry in India. you can reach us at:

Ascent Supply Chain Consultants Pvt.Ltd. (ASCC) 406, Raheja Arcade, Sector 11, CBD Belapur, Navi Mumbai -400614 MH-India Tel:+91 22 4897 4888 E-Mail : info@ascc.in