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Anil Ambani Group company Reliance Energy, top conglomerate Tatas and engineering giant L&T are among the shorlisted bidders for upgradation of Amritsar and Udaipur airports, financial bids for which will be invited by month-end. Airport Authority of India (AAI) had shortlisted five bidders each for the two airports. AAI will invite the request for proposals by month end and the outcome of this will be known possibly by middle of June. Besides, the three entities Fraport and Lanco are shortlisted for Amritsar airport, while GMR and Maytas Infra are in the race for Udaipur airport.

The Mukesh Ambani-led Reliance Industries, a giant in areas ranging from oil exploration to petrochemicals, proposes to invest $7.5 billion over the next 10 years to set up two microchip manufacturing units in India. The first unit with an investment of $2.9 billion will come up in Jamnagar in Gujarat to make solar-grade and polysilicon ingots and is expected to generate employment for 11,000 people. Location of the second facility has not been finalised, as it will depend on the type of incentive to be offered by a state government. However, it is expected to employ 4,000 people, a communication ministry statement said.

The company would locate this facility at Navi Mumbai, Hyderabad, Mysore or Haryana, the statement said, adding the investment proposed in this unit is estimated at $4.6 billion. The country’s semiconductor policy was announced last year and offers a host of fiscal incentives to develop India as a major hub in the area. The government has received investment proposals worth Rs.650 billion so far, including that of Reliance. Under a special incentive package scheme, the central government has to provide incentive of 20 percent capital expenditure during the first 10 years for units in Special Economic Zones (SEZ) and 25 percent of the capital expenditure in non-SEZ units.

Some other companies that have submitted proposals to set up semiconductor units include Videocon Industries that has plans to invest Rs.80 billion ($2 billion) in Navi Mumbai and Moser Baer with Rs.60 billion ($1.5 billion) near Chennai. Signet Solar has also planned to invest close to Rs.100 billion ($2.5 billion) in Tamil Nadu. The other companies include Titan Energy and KSK Energy Ventures, the official statement said.

Mukesh Ambani-led Reliance Industries is considering a foray into the manufacture of semi-conductors. Industry sources note that the company is planning to invest up to $6 billion over five years to set up a facility to manufacture not just silicon chips used in devices such as mobile phones and computers, but also liquid crystal display units and solar photovoltaic cells.

To be eligible, investors need to bring in at least Rs 2,500 crore for semiconductor manufacturing and at least Rs 1,000 crore for other units coming under the ecosystem such as LCDs and organic light emitting diodes (OLED). The minimum investment norms envisaged by the Government should not pose any problem for the company. At the current exchange rate for US dollar, the projected investment translates in rupee terms to Rs 24,000 crore.

The project is expected to be located in the company’s upcoming Special Economic Zone (SEZ) in Navi Mumbai, and will be eligible for the range of incentives offered in the Government’s semi-conductor policy outlined in March. According to the policy, the Union Government will contribute 20 per cent of capital expenditure for units in the SEZs and 25 per cent of capital expenditure for non-SEZ units. Incentives from State governments would be in addition to this.

Reliance Industries said, “The group is currently evaluating an investment in an integrated semi-conductor facility. Group will make necessary announcements when the plans are final.” Hyderabad, Mysore, Haryana and Navi Mumbai are the likely centres for setting up semi-conductor wafer fabrication facility units. Reliance is considering setting up a photovoltaic facility in Jamnagar, as well. It is open to acquiring facilities in Taiwan or Korea and is in talks with Infineon, TI and Qualcomm for a tie-up.

Reliance Industries’ proposal for establishment of a semiconductor wafer fab with assembly, test, mark and packaging facility has a total outlay of Rs 18,521 crores over a period of 10 years. It has sought subsidy to the tune of Rs 5720.70 crore for its two proposed units. It is envisaged that about 4000 people would be employed for the fabrication and ATMP units. The second Reliance plant is to come up at a cost of Rs 11,631 crore at Jamnagar, Gujarat. It will manufacture Polysilicon, single crystal/multi crystalline ingots, solar grade wafers, SPV modules with a capacity of one GW. The Plant is expected to create over 11,000 direct skilled, semiskilled and unskilled jobs in the country.

Domestic users of Piped Natural Gas (PNG) would be first on the priority list of customers for supply of natural gas followed by essential services such as hospitals. Users of Compressed Natural Gas (CNG), that are largely automobiles, and other consumers connected through the city gas distribution network, including commercial establishments like restaurants, will be last in the priority. CNG is cheaper than LPG in markets such as Mumbai and Delhi.

The Petroleum and Natural Gas Regulatory Board (PNGRB ) drew up the priority list as part of guidelines notified for City Gas Distribution network (CGD). The priority order would be followed in the case of disruption or interruption in the CGD network. However, the guidelines do not say anything on the consumer price.

PNGRB in a statement said city gas distribution projects in some 250 cities would be awarded on the basis of network tariff, CNG compression charge, the proposed length of pipeline and the number of households to be covered. The regulator also laid down the criteria for companies to bid for retailing PNG and CNG to vehicles but some industry players say the parameters defined do not keep consumer interest in mind and put gas producers, like Reliance Industries Ltd and BG India, at an advantage compared to those who do not have natural gas but might be only suppliers.

Network tariff would have 40 per cent weightage while CNG compression cost would have 10 per cent weightage during the bidding process to win a city. The notification of guidelines would open up the doors for more players in the CGD business that is currently dominated by Indraprastha Gas Ltd in New Delhi, Mahanagar Gas Ltd in Mumbai and Gujarat Gas in parts of Gujarat.

The dominance of these players might, however, end in three years time from the issue of authorisation letter by the board since according to the guidelines they are already operating the CGD network for three years. In case of other companies that have been in operation for less than three years or would start operations, the exclusivity period would end in five years. The tariff would be determined using the discounted cash flow methodology and the rate of return on capital employed shall be 14 per cent post-tax.

ADA Group company Reliance Communications (RCom) is planning to set up WiMax networks across 50 countries in the next three years to move into the global telecommunication market. To get a headstart, the telecom major is planning to acquire a European WiMax operator in a $300-400 million (Rs 1,200-1,600 crore) deal. The worldwide interoperability for microwave access (WiMax) is a telecommunications technology that provides wireless data over long distances in a variety of ways. RCom has set up WiMax networks in 18 cities in the country, where Tata Communications and state-owned Bharat Sanchar Nigam Ltd (BSNL) are the other major players.

According to sources close to the development, the Anil Ambani group company is close to acquiring a company in Europe that has WiMax licences for over 20 countries across Eastern Europe, Africa and Latin America. The name of the company could not be ascertained. But merchant banking sources said that the acquisition would be in the range of $300-400 million.

The acquisition of the European company will enable RCom set up fresh WiMax network in these countries and scale up the existing network. The Indian company will have to make additional investments in these countries. This would be company’s second acquisition in the WiMax space. In February, the company had acquired a significant stake in a French WiMax chip manufacturer Sequans Communications. The financial details of the acquisition were not disclosed. Further, RCom will expand its reach across countries in the Saarc region, Mediterranean and other South African nations.

However, sources added that the move was part of RCom’s `Vision 2012’. The company intends to use undersea cables and WiMax-enabled last mile access in a similar number of geographies. RCom intends to provide high-speed broadband services, voice, video and data suite and 4G services, after making inroads into the global market. The company intends to connect over 2.5 billion individuals over WiMax networks.