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Where would an Italian apparel firm prefer to set up its manufacturing unit, Shanghai or Solapur? China offered free land and electricity in Shanghai, while skilled labour was all that Solapur in western Maharashtra could offer.
Despite the lollies that Shanghai had, Carrera Holdings opted to set up its garment-processing unit at Chicholi in Solapur. It will also set up units in Kagal in Kolhapur, also in western Maharashtra.
The total investment will be Rs 500 crore. On Friday, the Italian firminked an agreement with the state government to produce yarn, hi-tech jet looms and topline garments.
Chairperson of the Italian company, Vivek Jacob, also sealed an agreement with state industries secretary VJairath to revive the dying textile andmanufacturing sector in Maharashtra. Plans have been finalised to set up a weavers' and apparels park in Solapur and a machinery manufacturing unit at Kagal.
Jacob, the son of an Indian official posted with the International Labour Organisation, grew up in Europe and has a significant stake in Carrera Holdings.
The development buttresses the state’s claim that it is the most-favoured investment destination in India, said Bhushan Gagrani, joint chief officer of the Maharashtra Industrial Development Corporation (MIDC).
More importantly, it has to a certain extent burst the bubble of those who say China is the mecca of manufacturing. Factors Against China
The Italian company, which has operations
in 15 countries across America and Europe, carefully weighed its options
and longtermbusiness interests before deciding on Maharashtra and rejecting
China. "We had great offers from China when we announced our investment
plans. They offered us free land, free power for our units and privileged
treatment. But there is an absolute lack of clarity in their corporate
laws. We, as a business house,would not be sure where our responsibilities
started and where they ended," said Jacob, pointing out the ambiguity in
Chinese administration and policies.
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