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The Reliance India Limited (RIL) Special Economic Zone (SEZ) in Gurgaon is on its way to being shelved.

Sources say RIL is expected to return the 1,383.68 acres it got from the government back to the Haryana State Industrial and Infrastructure Development Corporation Ltd (HSIIDC).

The decision comes after RIL chairman Mukesh Ambani met Haryana Chief Minister Bhupinder Singh Hooda in New Delhi this evening. “Since the setting up of the project has been delayed by about six years, we asked RIL to return us our land. They have laid down some conditions but I am hopeful we will be able to get our land back. We will develop this land on our own terms and in accordance with the state’s best interests,” Hooda told The Indian Express. “SEZs have failed across the world and it is no wonder that it has happened here as well.”

This SEZ was to be set up through a special purpose vehicle — Reliance Haryana SEZ Ltd — created after a collaboration between Reliance Ventures, a wholly owned subsidiary of RIL, and HSIIDC. RIL had 90 per cent stake in the project while HSIIDC holds 10 per cent sweat equity in the project.

RIL inked the pact with HSIIDC on June 19, 2006. Last year, RIL sought an extension of the in-principle approval by the commerce ministry till March 2015 but was given a year that ends March 31.

Showcased as a key achievement of the Congress government in the state, the RIL SEZ in Gurgaon, along with its sister project in Jhajjar, was to bring in an investment of around Rs 25000 crore through RIL and another Rs 15000 crore through companies which were to populate the SEZ. Hooda had, on the day of the signing, claimed that the project would create jobs for 5 lakh persons and that the state would earn Rs 10000 crore from the projects

Officials said the Model Economic Township (MET) at Jhajjar being set by the RIL in collaboration with Infrastructure Leasing and Financial Services Ltd would go on as planned.

The RIL is said to have paid Rs 400 crore for the land. If the land is returned, the HSIIDC will have to pay back RIL this amount along with the annuity that RIL paid to the farmers whose land was acquired by HSIIDC for the project.

In 2006, when the project was conceived, RIL planned to set up a 25000-acre SEZ stretching between Jhajjar and Gurgaon off the Delhi-Jaipur Highway. Later, the company decided to create two SEZs of 12500 acres each in Gurgaon and Jhajjar.

Later it was decided that instead of an SEZ in Jhajjar, RHSL would set up an MET on the lines of an industrial model township (IMT). The RIL is said to have bought over 7000 acres of land in Jhajjar for the project. For the Gurgaon SEZ, RIL is said to have bought 1200 acres of land other than the land given to it by HSIIDC. The company, it is stated, was trying to sort out the problem of contiguity of land for the project.