Ahmedabad, October 7, 2008 (IANS)

Farmers at Sanand village in Gujarat burst crackers and distributed sweets Tuesday evening, welcoming the Tata Motors' decision to relocate the Rs.15-billion Nano car project to the state. Alongside, corporate Gujarat also rejoiced. "It is a matter of great pleasure that Mr Ratan Tata's prestigious Nano car will roll out from Gujarat," said Parimal Nathwani, Reliance Industries Ltd president for corporate affairs and Rajya Sabha member.

"It is a decisive stamp on Gujarat's overall image of a vibrant and investor-friendly state," he said in an official statement here. He also said the Tatas and Gujarat were inseparable because of the group's presence in Mithapur, near Dwarka in Gujarat, for several decades through a Tata Chemicals plant there.

Added Vinai Saxena, director at Dholera Port and SEZ Ltd: "The pullout of the Nano project from Bengal proves that Gujarat is in a state of democratic harmony, industrial peace and development. The Mamata (Banerjee) and Medha (Patkar) factors that irresponsibly affect national development do not affect Gujarat."

Similarly, Sunil Parekh, advisor to Zydus Cadilla Group, said he was "truly euphoric".

"The project will add 10,000 additional jobs with Tata himself investing Rs.2,000 crore (Rs.20 billion). It will benefit other vendors too. It will give huge boost to ancillaries industry," Parekh said.

According to him, the Nano project would put Ahmedabad on the world map. "Foreigners will say, 'Oh, you come from where Nano is manufactured?'," Parekh said. "Gujarat's bureaucracy is well tuned to business development."

Y.K. Alagh, former central minister and chairman of Institute of Rural Management at Anand, said both north and central Gujarat would progress. "This will bring in technological innovations as Nano is a new technological project," he said.

Rajkot Engineering Association president Bhavesh Patel also welcomed the development, saying the near 2,000 big and 7,000 small casting and machining industries in Rajkot and Saurashtra would benefit.

"It is a day of rejoicing for trade circles," added Hitesh Baghdai, president of the Rajkot Chamber of Commerce and Industry.

Why Tata chose Gujarat for Nano over other states

Tata Motors opted for Gujarat over several other states for its Nano project because of the speed at which the state acted after the auto major pulled out of Singur in West Bengal, company chairman Ratan Tata said here Friday.

“We have selected Gujarat over other states because of the speed in which it acted,” Tata said at a press conference, which was also addressed by Gujarat Chief Minister Narendra Modi. "The site in Gujarat, already under the possession of the state government, will help Tata Motors establish a new dedicated mother plant with the shortest possible time lag and least possible incremental project cost," Tata said.

He said the infrastructure available in the state, as well as the spirit and enterprise of the people of Gujarat and the state government led by Modi also made the choice compelling in the best interest of the project. Company officials said the strategic location of Sanand, some 30 km from Ahmedabad and its proximity to the Ahmedabad-Rajkot highway made the new site attractive.

The plant will be spread over about 1,100 acres, and will have an initial capacity of 250,000 units, which can be expanded to 500,000 cars annually. The project, including Tata Motors' plant, vendor facilities and units for service providers, will together generate over 10,000 direct and indirect jobs, Tata Motors said in a statement.

Apart from Gujarat, states such as Karnataka, Andhra Pradesh, Haryana, Rajasthan, Orissa, Maharashtra and Uttarakhand had tried to wangle the project, which was moved out of Singur, West Bengal, after wallowing in controversy for over two years since its inception.