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Comprehensive Gujarat Review '06
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Comprehensive Gujarat Review '06 Comprehensive Gujarat Review '06 Presentation Transcript

  • Comprehensive Gujarat Review’06 Compiled by Rahul Guhathakurta Indian Institute of Planning & Management, Ahmedabad
  • Introducing Gujarat: Fast Facts Economic Snapshot With 5% of India’s population, Gujarat has 16% of industrial production. Gujarat had an annual average growth of 9% in the last 3 years and an average industrial growth of 15%. Source: Socio-Economic Review, Gujarat State 2005-06 Gross State Domestic Product (GSDP) USD 38.4 Billion Manufacturing Sector USD 7.1 Billion Fixed Capital Investment USD 18.4 Billion Exports 14% of India Average growth rate 9% per annum Industrial growth rate 15% per annum 9.3 % Inflation rate (WPI) 118 per 1000 persons (National Average: 57) Motor Vehicles 41 per 1000 persons (National Average: 26) Cellular Connection 1,175 units (National Average: 592) Per Capita Power Consumption 37.36% Urbanisation 69.9 % Literacy Rate USD 630 (National Average USD 516.5) Per Capita Income (at current prices) English Business language 196,000 sq. km (6.19% of India) Geographical Area 50 million (5% of India) Population
  • Gujarat: Where Business is a way of life.. Gujarat: Industry Profile Gujarat offers a unique combination of a strategic geographic location, state-of-the-art infrastructure, multilingual workforce, and concentration of corporate and financial resources, all in a world-class pro-business environment. Source: Socio-Economic Review, Gujarat State 2005-06 Gujarat tops in Economic Freedom Index (Source: Rajiv Gandhi Institute for Contemporary Studies) Investment Environment is the best in Gujarat among big states of India and has recorded the fastest economic growth among all states (Source: India Today’s exclusive report “India’s Best & Worst States”, 15th August, 2005) USD 6.37 billion (13.2% share of India) Value Addition USD 44.4 billion (16.1% share of India ) Industrial Production 18.2% of India Fixed Capital Investment Over 2,200 Medium & Large Ind. Units Over 310,000 Small Scale Sector Units 31 % Share in NSDP USD 7.1billion Manufacturing Sector(GDP)
  • Gujarat: The Growth Engine of India Gujarat’s Sector Contributions to National Output Contributing to India’s economy across all major sectors… Source: Socio-Economic Review, Gujarat State 2005-06 Sector Composition of Gujarat’s Industrial Production Petroleum Products Chemicals & Pharma Textile & Apparel Metallurgical Industries Mineral based Industries Paper Production Diamond Processing
  • … Thrust area for the Gujarat Government … Witnessing Abundance of Opportunity Investment promotion is viewed as a major growth engine of the State Economy Booming State Economy, Improved Living conditions, Policy & Taxation reforms, Rise in Gross Capital Formation, Low penetration levels, High export potential Gujarat: Focused & Progressive… Per Capita Income at Constant Prices : Gujarat vs India Per Capita Income at Constant Prices Gujarat’s Development vs Non Development Expenditure … Increasing Development Activities Urban, social and industrial development is being promoted in totality
    • Urban – provision of water & power supply, road networking, waste management, usage of CNG, tele-density
    • Social – Educational institutions (Literacy), public redressal systems through IT
    • Industrial – 33 SEZs and several Industrial estates & clusters are driving the industrial development thus furthering Gujarat’s cause as a manufacturing hub
    Expenditure in USD billion
  • State-wise Comparison of Investment Proposals through Industrial Entrepreneurs Memoranda (1996-2006) Source: NIC, Government of India (GOI) *As on 31/07/06 State wise Value of Investments Source: NIC, Government of India (GOI) Annual Average in %age Major Statewise Growth Rate Targets For 10 th Five Year Plan Gujarat: Marching ahead of other states in India.. Gujarat has a high implementation ratio of 47.33% of industrial proposals in terms of investment
    • As on 31st July 2006, Gujarat accounts for the highest investment in India. 16.13% - USD 73.3 billion among 8126 projects.
    • In last five years (2001-2006), the state has attracted highest investment among all states in India – USD 40.66 billions
    • Implementation of projects (realisation) is as high as 50% in Gujarat.
    Source: NIC, Government of India (GOI) *As on 31/10/05 In USD billion
    • There are 10 airports under the operational jurisdiction of Airports Authority of India (AAI)
      • International airport : Ahmedabad
      • Domestic airports : Vadodara, Jamnagar, Rajkot, Bhavnagar, Porbandar, Bhuj, Surat, Keshod and Ahmedabad
    • Apart from AAI airports there are six airstrips in various stages of development under the State Government
    Airport Port
    • Gujarat has 41 ports along a coastline of 1600 Kms ; 11 are intermediate ports and 29 are minor ports
    • Kandla is a major port controlled by the Central Government of India with traffic handle of 45.9 MMTS
    • Wide and fastest access to hinterland which accelerates speed to market.
    Rail and Road
    • Electricity Generation Capacity 9288MW (2005)
    • SEZ led development 33 SEZ
    • Focused product clusters 83
    • Longest Coastline in India 1600 Kms
    • Larger number of ports 41
    • Number of Airports 10
    Gujarat: A preferred destination for investment Gujarat Ports handled a cargo traffic of 103.9 million metric tonnes in 2005-06 Gujarat is well connected to major cities in the USA, EU, Asia and other Indian metropolitan cities
    • State-of-the-art road infrastructure such as India’s first National Expressway from Ahmedabad to Vadodara .
    • Good rail and road linkages to all the ports, industrial estates and major cities
    • Well connected to major cities across India by rail and road.
  • Status of Power Sector in Gujarat Source: Power Supply Demand Projections (16th EPS Report)
    • High quality of power, both in terms of uninterrupted supplies and also in terms maintaining frequency, without fluctuations
    • Per capita power consumption is 1,175 units whereas India’s average is 592 units
    • Rich availability of natural gas ( 34 MMCD ) and Lignite ( 1,072 MMT )
    • HT gets 24x7 power supply
    • No power cuts in GIDC industrial estates and other industrial estates
    • No power cuts in town and cities
    … Power Infrastructure
    • Ahmedabad has the lowest labour costs amongst the major cities in India, with a labour costs less than 50% of those in Delhi and 40% below those in Pune.
    • Least mandays lost due to industrial unrest – 0.94 % of the country as against 16.2% industrial production
    • Only state in the country to allow exit options to investors in terms of termination of labours and closure of units in SEZs
    • Government has amended labor legislations to provide total freedom to industry to employ labor on contract basis across the State
    … Labour Advantage Gujarat: A preferred destination for investment Labour costs in the leading cities in India Source: Jones Lang Salle 49 57 63 69 80 91 100 MW MW MW Installed Capacity Power Generation MW A Dramatic Rise
    • Good educational facilities and R&D Institutions
    • 39 Engineering Colleges offering undergraduate courses having 12,500 seats
    • 49 Polytechnics offering diploma courses in Engineering having 16,500 seats
    • Centers of Excellence such as IIM, NID, NIFT, EDI, PERD
    … Availability of Manpower Gujarat: A preferred destination for investment The availability of well-developed infrastructure in terms of quality roads, railway network, air connectivity, effectively lubricates the vibrant economic activities of the State
    • One of the largest gas producing region in the country
    • Two LNG Terminals at Dahej & Hazira
    • Only state to have an integrated gas grid
    • Total gas grid project - 2200 km
    … Gas Infrastructure Gas Grid Development
    • Presence of good medical hospitals and facilities
    • Low crime rate, among the lowest rates in India
    • Good educational infrastructure
    • Relatively less congested and polluted, offering better standards of living to its inhabitants.
    … Social Infrastructure
  • The Government of Gujarat has announced an investor friendly Industrial Policy, which is aimed at achieving global competitiveness. Industrial Policy Development of thrust industries Human resource development Labour law reforms Cluster development – SME sector Provide Information & facilitation Single window clearance State of the art Infrastructure Environment protection Regional development Key Initiatives Eleven different investment schemes have been introduced to promote investment in the State Government’s commitment to Industrial Development
  • SEZ: Driving Industrial development in Gujarat Source: Industries Commissionerate, Government of Gujarat Only state in India to offer totally flexible labour laws, with exit option, in SEZs Others Textile/ Apparel IT/ITES Engineering Chemicals and Pharmaceuticals Chemical Pharma Petroleum & Petrochemicals Multiproduct
  • With 33 SEZs, Gujarat has one of the highest number of SEZs in India SEZ: Driving Industrial development in Gujarat Source: Ministry of Commerce and Industry, Department of Commerce 4494 Jamnagar Reliance SEZ 160 Bharuch Jubiliant Chem 106 Bharuch Jayant Oil Chemicals/ Petrochemicals SEZ Multi-product SEZ Kandla KPT SEZ 2658 Kutch GAPL SEZ 3380 Bharuch Sterling SEZ 1125 Jamnagar Essar SEZ 1000 Ahmedabad Dholera SEZ 1740 Bharuch Dahej SEZ Ltd. 10,000 Kutch Mundra SEZ 112 Surat Sur SEZ 400 Kutch Kandla SEZ Area (Hect) Location Name of SEZ 164.80 Kutch Ruchi Flat 230 Ahmedabad Gallops SEZ 24.85 Gandhinagar Aqualine 54.50 Ahmedabad Million Minds 16 Gandhinagar 3 rd Eye Voice 267 Surat Essar 101 Vadodara Suzlon 145 Ahmedabad Dishman IT/ ITeS SEZ Engineering SEZ Pharmaceutical SEZ 130 Bharuch JB Chemicals 138 Ahmedabad Dishman 100 Vilayat Jubiliant SEZ 100 Ahmedabad Cadila SEZ 48 Ahmedabad High Tech Area (Hect) Location Name of SEZ 197 Ceramics & Glass SEZ Bharuch Jhagadia SEZ Electronics SEZ Gandhinagar Electronic 74 Surat Gems & Jewellery Gems & Jewellery SEZ Kutch Adani Power 180 Surat Essar Power Power SEZ Apparel SEZ 284 Surat Anjar SEZ 38 Ahmedabad Apparel Park 56 Surat Apparel Park Area (Hect) Location Name of SEZ
  • For SEZ Units
    • Income Tax Incentives
    • 100% tax holiday for a period of any 10 consecutive years out of 15 years beginning from the year in which the SEZ is notified
    • Exempt from dividend distribution tax
    • Tax exempt on Interest of long term finance
    • Long-term capital gains arising on transfer of shares in developer company tax exempt
    • No minimum alternate tax (MAT)
    For Developers of SEZ s
    • Income Tax Incentives
    • 10 year corporate tax holiday on export profit – 100% for initial 5 years and 50% for the next 5 years
    • No MAT
    Common Incentives
    • Indirect Tax Incentives
    • Nil customs duty
    • Nil excise duty
    • Exemption from VAT and stamp duty
    • Exemption from central sales tax
    • Exemption from service tax
    • Exemption from securities transaction tax
    • Exemption from tax on sale of electricity for self generated and purchased power
    • Other Benefits
    • Exemption electricity duty
    • Duty free procurement of capital goods (including second hand capital goods), raw materials and consumable spares from domestic market
    • Full freedom for sub contracting
    • Facility to realize and repatriate export proceeds within 12 months
    • Facility to retain 100% foreign exchange receipts in the export earners foreign currency account
    • Other Benefits
    • Full freedom in allocation of developed plots to approved SEZ units on purely commercial basis
    • Full authority to provide services like water, electricity, security, restaurants and recreation centres on commercial lines
    • No net foreign exchange earning requirement imposed
    SEZ scheme has been introduced to provide hassle free environment and state of the art infrastructure Gujarat has liberal labour policy providing complete flexibility in SEZs SEZ Development Committee monitors infrastructure development for each SEZ SEZ Advantage.. Source: Ministry of Commerce and Industry, Department of Commerce
  • + Time to secure first-mover advantage in India Relaxing FDI norms Resplendent Market Booming Consumerism Vibrant Economy Is this the right time? … It is
  • Welcome to Gujarat Explore.. Envision.. Invest