The Petroleum, Chemicals, and Petrochemicals Investment Region (PCPIR) Policy 2007 is being overhauled after attracting an investment of Rs 20 lakh crore by 2035, making the Centre the main driver to develop India as a global hub for chemicals, petroleum, and petrochemicals processing and manufacturing.In the proposed new policy 2020-35, with a specific cluster integration strategy, the very notion of PCPIR is being modified wherein the size of each investment region will be drastically cut down to 50 sq km from 250 sq km. As the huge upfront capital costs did not let the proposed projects take off under the policy framed in 2007, dovetailing the PCPIRs with the National Infrastructure Pipeline could give a major push. For infrastructure projects in PCPIRs, the Centre is expected to provide Viability Gap Funding (VGF) of up to 20% under the new policy. It may also provide an additional budgetary allocation of 20% for smart and sustainable systems like integrated solid waste management, emergency response systems, zero liquid discharge-based common effluent treatment plant, and real-time environmental monitoring systems. Additionally, the VGF could enable each project to catalyse around Rs 2 lakh crore. Headed by Rajat Bhargava, the government's Special Chief Secretary of Andhra Pradesh, a high-level committee drafted the new PCPIR Policy 2020-35 and recently presented it to the Union Department of Chemicals and Petrochemicals. The new policy instructs the central government to shoulder the bulk of it, unlike the PCPIR Policy-2007 which thrust the burden on state governments to develop the petroleum investment regions in their respective states. The Committee suggested that it ensures priority funding of PCPIR projects under the National Infrastructure Pipeline to improve financing options, as the Centre visualises executing infrastructure projects worth Rs 100 lakh crore over the next five years. In its report, the panel proposed that the Centre develop a strategy for attracting anchor projects for any proposed new PCPIRs and each of the existing ones. To act as a catalyst for the development of other projects, it is recommended that the Centre assist the state governments in distinguishing an anchor unit for every PCPIR. For receiving technical assistance for master planning, detailed engineering, and project management consultancy, the government shall provide a Project Design and Management Consultancy (PDMC) Fund of Rs 15 crore to each PCPIR to provide funding to state governments. Rajat Bhargava, who oversaw the high-level Committee, told media sources that in the next ten years, they require at least ten projects to grow as an industrial power. To secure financial closure for these large projects, the states and the Centre should work as a team. The new policy has been targeted to attract a combined investment of Rs 10 lakh crore by 2025, Rs 15 lakh crore by 2030, and Rs 20 lakh crore by 2035 in all the PCPIRs in the country, under the new PCPIR Policy 2020-35. Following the proposed interventions, the existing PCPIRs will now be required to revise their Development Plans (DPs), as a new policy is on the anvil. Source: The Economic Times