Karnataka State South India August 2013


Published on

Karnataka State South India

Economic Snapshot

August 2013

Published in: Business
1 Like
  • Be the first to comment

No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide

Karnataka State South India August 2013

  1. 1.       
  2. 2. 6th largest state in terms of GDP size in 2011-12 • • • The state contributed 5.6 per cent to the GSDP of India in 2012-13*. Average GSDP growth rate between 2004-05 and 2012-13 was about 15.5** per cent. The per capita GSDP increased to US$ 1,608.4, growing at a CAGR of 14.2** per cent between 2004-05 and 2012-13. • IT hub of India Karnataka is the IT hub of India and home to the fourth largest technology cluster in the world. • It accounted for 41.6 per cent (US$ 28.3 billion) of India’s electronics and software exports in 2011-12. • It has 47 IT/ITeS SEZs, 3 software technology parks and dedicated IT investment regions. • Vibrant industrial base Karnataka has vibrant automobile, agro, aerospace, textile & garment, biotech and heavy engineering industries. • It has sector-specific SEZs for key industries such as IT, biotechnology, engineering, food processing and aerospace. An ITIR spread across 10,000 acres is being developed near BIA. • One of the preferred investment destinations A conducive business environment has helped the state rank fifth in terms of attracting private sector investments in India, as of December 2012. • Total outstanding investments amounted to US$ 813.8*** billion in 2012-13, while cumulative FDI inflows from April 2000 to March 2013 stood at US$ 10.8 billion, the fourth highest in India. Sources: Global Investors Meet 2012, Department of IT, BT and S&T, Karnataka, ASSOCHAM report, Planning Commission Databook 2012-13, DIPP, CMIE ITIR: Information technology Investment Region, BIA: Bengaluru International Airport, * GSDP 2012-13 till Feb 2013, **In Indian rupee terms, ***At 2012-13 rates
  3. 3. • Vast natural resource pool Karnataka is the sole producer of felsites and the leading producer of iron ore, chromite, and dunite and contributes 99.0 per cent to India's total gold production. • Karnataka hosts 78.0 per cent of vanadium ore, 74.0 per cent of iron ore (magnetite), 42.0 per cent of tungsten ore and 38.0 per cent of asbestos reserves in India. • Strong knowledge infrastructure Karnataka has 40 universities, 3,640 pre-university colleges, 187 engineering colleges and 289 polytechnics, 43 medical colleges, 41 dental colleges and 1,162 industrial training institutes. • It also houses 366 R&D centres; around 400 of the Fortune Global 500 companies outsource their IT services to firms in Bengaluru. • Contributes 7% to the agricultural production of India Number 4 in terms of tourist arrivals in India Karnataka accounts for 70.0 per cent of the coffee production in India; coffee exports from Karnataka stood at US$ 584.3 million in 2011-12. • It is the 5th largest producer of fruits in the country and the fourth largest producer of spices. • Karnataka is also the third largest producer of plantation crops in the country. • Karnataka boasts of a diverse flora and fauna and a 320 km natural coast line, which makes it a nature tourist's paradise. • It has World Heritage Sites at Hampi and Pattadakal. Sources: Indian Minerals Yearbook 2011, Global Investors Meet 2012, Economic Survey of Karnataka 2011-12, Visvesvarya Industrial Trade Centre, Bounteous Karnataka
  4. 4. High economic growth Growing demand 2011-12 GSDP expanded at a CAGR of 15.5** per cent between 2004-05 and 201213***. • Karnataka is termed as the ‘Knowledge Capital of India’. The state has successfully attracted skilled labour, especially, in the knowledge sector. It is among the states that produce a large number of doctors, engineers and medical technicians in the country. Buoyant services (IT, tourism) and industries driving economic growth. • • • • IT exports: US$ 28.3 billion**** Rich talent pool Sector specific SEZs and SIRs facilitating growth. 2020 target IT exports: US$ 73.7 billion Advantage: Karnataka Infrastructure • Well developed social, physical and industrial infrastructure. • Good road, rail, water and air connectivity and substantial port infrastructure. • Policy support • • • • Well developed telecom infrastructure. • • The engineering sector is delicensed; Wide range of fiscal and policy 100 per cent businesses under the incentives forFDI is allowed in the sector Karnataka Industrial Policy, 2009-14. Due to policy support, there was Investor friendly sector specific policies cumulative FDI of USD14.0 billion into to promote industries like IT, the sector over April 2000 – February biotechnology, textiles and tourism. 2012, making up 8.6 per cent of total FDI into the country in that period Simplified procedures for investment. Excellent healthcare facilities. Sources: Karnataka Udyog Mitra, Planning Commission Databook 2012-13, D&B Cluster State Overview, CMIE, Karnataka Vision 2020, Department of Industrial Policy and Promotion *Target at 2012-13 rates, **In Indian rupee terms, ***GSDP 2012-13 till Feb 2013, ****At 2011-12 rates, includes electronics and computer software
  5. 5. Some of the prominent cities in the state are Ankola, Bengaluru, Bagalkot, Belgaum, Bidar, Bijapur, Chikmagalur, Chitradurga, Dandeli, Hubli-Dharwad, Mangalore, Mysore and Shimoga. Karnataka has a tropical climate with three major seasons: warm and dry from February to May, monsoon from June to October and winter from November to January. Parameters Capital Source: Maps of India Karnataka Bengaluru Languages spoken are Kannada, Tulu, Kodava, Hindi and English. 191,791 Administrative districts (No) Karnataka is located in the southern region of India. It is surrounded by the Arabian Sea in the west, Goa in the northwest, Maharashtra in the north, Andhra Pradesh in the east, Tamil Nadu in the southeast, and Kerala in the southwest. Geographical area (sq km) 30 Population density (persons per sq km)* 319 Total population (million)* 61 Male population (million)* 31 Female population (million)* 30 Sex ratio (females per 1,000 males)* 968 Literacy rate (%)* 75.6 Sources: Economic Survey of Karnataka 2011-12, *Provisional data – Census 2011
  6. 6. Parameter Karnataka All-States Source GSDP as a percentage of all states’ GSDP* 5.57 100 Planning Commission Databook, 2012-13, current prices Average GSDP growth rate (%)** 15.5 15.6 Planning Commission Databook, 2012-13, 2004-05 to 2012-13, current prices 1608.4 1414.2 Planning Commission Databook, 2012-13, current prices 13,759.3 225,133.1 Central Electricity Authority, as of May 2013 Wireless subscribers (No) 52,914,789 867,803,583 Telecom Regulatory Authority of India, as of March 2013 Broadband subscribers (No) 1,344,354*** 15,050,000 Telecom Regulatory Authority of India, as of March 2013 National Highway length (km) 4,642 79,116 Ministry of Road Transport & Highways, as of March 2013 Major and minor ports (No) 1+10 13+187 Indian Ports Association 5 133 Airports Authority of India Economy Per capita GSDP (US$) Physical Infrastructure Installed power capacity (MW) Airports (No) GSDP 2012-13, Till February 2013, **In Indian rupee terms, ***As of December 2011
  7. 7. Parameter Karnataka All-States Source Literacy rate (%) 75.6 74.0 Provisional data – Census 2011 Birth rate (per 1,000 population) 18.8 21.8 SRS Bulletin (www.censusindia.gov.in), 2012 10.8 193.3 Department of Industrial Policy & Promotion, April 2000 to March 2013 813.8* 10,499.2* CMIE (2012-13) PPP projects (No) 108 881 www.pppindiadatabase.com SEZs (No) 40 385 Notified as of March 2013, www.sezindia.nic.in Social Indicators Investment FDI equity inflows (US$ billion) Outstanding investments (US$ billion) Industrial Infrastructure PPP: Public-Private Partnership, SEZ: Special Economic Zone, SRS: Sample Registration System *At 2012-13 rates
  8. 8. 97.1 67.3 2010-2011 2006-2007 44.2 2005-2006 37.1 2004-2005 Growth has been mainly driven by secondary and tertiary sectors. 96.6 2012-2013* 50.2 71.2 89.2 2011-2012 67.6 2009-2010 CAGR: 15.5%** The average GSDP growth rate between 2004-05 and 2012-13 was about 15.5** per cent. 2008-2009 GSDP of Karnataka at current prices (US$ billion) 2007-2008 At current prices, the gross state domestic product (GSDP) of Karnataka was about US$ 97.1* billion in 2012-13. Sources: Planning Commission Databook 2012-13 *Till February 2013 **In Indian rupee terms
  9. 9. 60.4 86.1 86.8 63.5 2009-2010 45.0 2010-2011 39.5 2006-2007 2004-2005 33.1 60.7 2008-2009 79.3 2007-2008 The average NSDP growth rate between 2004-05 and 2012-13 was 15.5** per cent. 2012-2013* CAGR: 15.5%** 2011-2012 NSDP of Karnataka at current prices (US$ billion) 2005-2006 The net state domestic product (NSDP) of Karnataka was about US$ 86.8 billion in 2012-13. Sources: Planning Commission Databook 2012-13 *Till February 2013, **In Indian rupee terms
  10. 10. The state’s per capita GSDP in 2012-13 was US$ 1,608.4*. GSDP per capita of Karnataka at current prices (US$) 1,608 986 1,427 1,061 2009-2010 1,265 CAGR: 14.2%** 2008-2009 The per capita GSDP increased at a compound annual growth rate (CAGR) of 14.2** per cent between 2004-05 and 2012-13. 739 2005-2006 2006-2007 870 644 2012-2013* 2011-2012 2010-2011 2007-2008 2004-2005 555 Sources: Planning Commission Databook 2012-13 *Till February 2013 **In Indian rupee terms
  11. 11. The state’s per capita NSDP in 2012-13 was US$ 1,437.0*. NSDP per capita of Karnataka at current prices (US$) The per capita NSDP increased at a CAGR of 14.3** per cent between 2004-05 and 2012-13. 1,440 CAGR: 14.3%** 1,437 1,340 1,047 1,084 2012-2013* 2011-2012 2010-2011 2009-2010 2008-2009 795 2007-2008 705 2006-2007 2004-2005 598 2005-2006 1,054 Sources: Planning Commission Databook 2012-13 *Till February 2013, **In Indian rupee terms
  12. 12. In 2012-13, the tertiary sector contributed 58.8 per cent to the state’s GSDP at current prices, followed by the secondary sector (25.9 per cent) and primary sector (15.3 per cent). GSDP composition by sector CAGR 19.9% At a CAGR of 17.5* per cent, the tertiary sector has been the fastest growing among the three sectors from 2004-05 to 2012-13. The growth has been driven by trade, hotels, real estate, finance, insurance, transport, communications and other services. 12.6*% 29.1% 13.3*% 25.9% 58.8% 51.0% The secondary sector grew at a CAGR of 13.3* per cent between 2004-05 and 2012-13. It was driven by manufacturing, construction and electricity, gas & water supply. The primary sector grew at a CAGR of 12.6* per cent between 2004-05 and 2012-13. 15.3% 17.5*% 2004-05 Primary sector Secondary sector 2012-13 Tertiary sector Source: CMIE *Growth rate in INR terms
  13. 13. Sugarcane was the major crop of the state with production of about 38.0 million tonnes in 2011-12. Crop Annual production estimate^ in 2012-13 (‘000 tonnes) Major oilseeds production is estimated to be 1.1 million tonnes in 2012-13. Production of cereals and pulses in the state is estimated to be 10.6 million tonnes and 1.4 million tonnes, respectively, in 2012-13. In 2012-13, total vegetable production in the state is estimated at 8.0 million tonnes. Sugarcane 32,260 Maize 3,320 Rice 4,070 Onion 2,510 Banana The state’s food grain production is estimated to be 12.0 million tonnes in 2012-13. 2,190 Coconut^^ Sorghum (jowar) Cotton* Groundnut 1,716.3 1,363 860 555.9 Potato 510 Coffee 295** Wheat Total fruits production in the state is estimated at 6.7 million tonnes in 2012-13. 345 Total pulses 1,362.5 Total major oilseeds 1,096.1 Sources: Economic Survey of Karnataka 2011-12, Coffee Board of India, Indian Horticulture Database 2011, National Horticulture Board, Karnataka Agriculture Budget 2013-14, Coconut Development Board, *’000 bales of 170 kgs each, **Estimates for 2012-13, ^Forecast by CMIE, ^^Million nuts
  14. 14. During 2011-12, total exports from the state aggregated US$ 45.7 billion which is approximately 12.3 per cent of India’s total exports. Karnataka’s exports grew at a CAGR of 15.3* per cent during 2006-07 to 2011-12. From a sector-specific perspective, exports of agriculturebased products, computer software & biotechnology, readymade garments, petroleum & petroleum products, engineering products, coffee products, basic chemicals, pharmaceuticals & cosmetics, gems & jewellery, marine products and spices increased significantly in 2011-12 as compared to the previous year. Break up of exports by sector (2011-12) Miscellaneous and others 8% Handloom & textiles 4% Engineering products 4% Gem and jewellery 11% Petroleum and chemical products 11% Electronics & computer software 62% Electronic and software exports from the state totalled US$ 28.3 billion in 2011-12. Onions 17% Karnataka exported US$ 4,985.0 million worth of petroleum and chemical products during 2011-12. Sources: Visvesvarya Industrial Trade Centre, Government of Karnataka *Growth rate in INR terms STPI: Software Technology Parks of India
  15. 15. The state has a stable political environment. Successive state governments have realised the importance of industries in the state and have provided conducive business environment to attract domestic as well as foreign entities. In 2012-13, outstanding investments in the state totalled US$ 813.8* billion, representing nearly 8.0 per cent of total outstanding investments in India. Break up of outstanding investments by sector (2012-13) 5.2% 1.4% Manufacturing Services 13.0% 42.5% 14.6% Of the total outstanding investments, the manufacturing sector attracted the most (42.5 per cent), followed by the services sector (23.4 per cent). Real Estate Electricity Irrigation 23.4% Mining Karnataka is ranked 5th in terms of attracting private sector investments in India. According to the Department of Industrial Policy & Promotion (DIPP), the cumulative FDI inflows from April 2000 to March 2013 amounted to US$ 10.8 billion, the fourth highest in India. FDI inflows from April 2012 to March 2013 stood at US$ 1,023 million. Sources: Composition of outstanding investments across states, ASSOCHAM, Department of Industrial Policy and Promotion, Global Investors Meet 2012, CMIE *At 2012-13 rates **At 2011-12 rates
  16. 16. Karnataka attracted investments worth US$ 150.2* billion during the Global Investors Meet, 2012. Investment proposals signed at Global Investors Meet 2012 Sector Amount (US$ billion)* Energy 52.15 Automobile 1.95 Iron and steel 22.56 Cement and other minerals 10.34 Education and R&D 1.73 Agro, food and horticulture 3.32 Biotech and pharma 0.38 Textiles and apparels 0.99 Tourism 8.30 Housing and urban development 6.87 Industrial infrastructure 9.18 IT & electronics 14.98 Chemicals and petrochemicals 8.87 Engineering 3.29 Aerospace and defence 2.66 Others 2.74 Source: Global Investors Meet, 2012, *At 2012-13 rates
  17. 17. Under Karnataka State Highways Improvement Project (KSHP-I), 2,414 km of state highways and major district roads were taken up for development. Of this, a length of 2,384 km has been developed. The Karnataka State Road Transport Corporation (KSRTC), established in August 1961, provides state road transport services. Karnataka plans to construct 100,000 km of roads by 2020; this entails an investment of US$ 26.0 billion. Source: Maps of India Road type The state is well connected to its five neighbouring states and other parts of India via 15 national highways that run through the state. The Karnataka Road Development Corporation Ltd (KRDCL) has been created as a state-owned enterprise for the development of road infrastructure facilities in the state. Road length in km, (March 2012) National highways 4,642** State highways 20,774 Major district roads 49,906 Municipal roads 8,366* Other roads 148,412* Sources: Economic Survey of Karnataka 2011-12, Ministry of Road Transport & Highways, Global Investors Meet 2012, Department of Tourism, Karnataka, Karnataka PWD, *As of December 2010, **As of March 2013
  18. 18. Karnataka is well-connected to other parts of the country Growing demand via the railways. The state has a railway network of 3,250 km. Karnataka railway network Type of railway Length (km) South Central Railways Karnataka Rail Infrastructure Development Corporation (K-RIDE) has been set up with the objective of developing and implementing rail infrastructure projects in Karnataka with private sector participation wherever feasible. 268 South Western Railways 2,697 Southern Railways 37 Konkan Railways 248 Total K-RIDE has a Chief Executive Officer deputed from the Railways Department and Principal Secretary, Infrastructure Development Department as its Chairman. 3,250 Key proposed new projects Length Cost (US$ million)* Hassan-Bengaluru (New Line) 166 197 Tumkur-Rayadurga (New Line) 102 202 Munirabad-Mehboobnagar (New Line) 170 177 Bagalkot-Kudachi (New Line) 142 170 Tumkur-Davangere (New Line) 200 190 Bidar-Gulbarga (New Line) 107 77 Hubli-Ankola (New Line) 167 483 Bengaluru-Satyamangala (New Line) Bengaluru Metro Rail, also known as Namma Metro (our metro), is a mass-transit rail system for the city of Bengaluru. Bengaluru Metro Rail Corporation Limited (BMRCL), a joint venture of Government of India and Government of Karnataka, is a special purpose vehicle (SPV) entrusted with the responsibility of implementation of Bengaluru Metro Rail Project. Namma Metro started in October 2011 and Phase II is currently under implementation. 162 375 Project Sources: Economic Survey of Karnataka 2011-12, Infrastructure Development Department, Karnataka, *At 2011-12 prices
  19. 19. The state has five domestic airports. These are located in Growing demand Bengaluru, Mangalore, Hubli, Mysore and Belgaum. International flights operate from the airports at Bengaluru and Mangalore. Bengaluru International Airport; the country’s first greenfield international airport, has been developed at Devanahalli in Bengaluru as a passenger and cargo department hub. It was developed under the PPP model and started operations in May 2008. The Bengaluru International Airport handles 12 million passengers annually. Minor airports at Shimoga, Gulbarga, Bijapur and Hassan are being developed on PPP mode through private promoters. The existing airport at Hubli is being upgraded to international standards. Source: Global Investors Meet, 2012
  20. 20. There are 11 ports in Karnataka, of which new Mangalore is a major port. New Mangalore Port is the 9th major port in India with the deepest inner harbour on the west coast. Major cargo have been handled by Karwar, Belikeri, Malpe and old Mangalore ports in 2010-11. Among them, the cargo handled by Belikeri port was significantly higher as compared to other ports. Karwar Port Ports • New Mangalore Port • Major ports Karwar Belekeri Tadri Honnavar Bhatkal Kundapur Hangarkatta Malpe Padubidri Old Mangalore • • • New Mangalore Port • Minor ports • • • • • Source: Global Investors Meet, 2012
  21. 21. As of May 2013, the state had an installed power generation capacity of 13,759.3 MW. The state contributed 7,349.1 MW of this capacity, the private sector contributed 4,776.9 MW, whereas the central government’s share was 1,633.3 MW. The installed capacity has increased from 9,346.7 MW in 2009 to 13,759.3 MW in 2013. Installed power capacity (MW) CAGR: 9.2% 13,393.5 13,759.3 11,546.1 9,346.7 10,386.3 Of the total installed power generation capacity, 6,392.8 MW was contributed by thermal power. 254.9 MW and 3,386.0 MW was contributed by nuclear and renewable power, respectively, while hydropower contributed 3,599.8 MW. 2008-09 2009-10 2010-11 2011-12 2012-13* The government has taken steps to undertake several new small, medium and large scale power projects. Karnataka Renewable Energy Development Limited (KREDL) was established in 1996 to promote the development of renewable energy sources in the state. Source: Central Electricity Authority *As of May 2013
  22. 22. The installed capacity will increase by 10,200 MW over the next three years, as a number of projects are currently under implementation. Major power projects to be completed in the next three years Power transmission is overseen by: Karnataka Power Transmission Corporation Limited (KPTCL) Project Capacity Yaramaras Thermal Power Station 2x800 MW Yadlapura Thermal Power Station State-owned power generation in Karnataka is managed by: Karnataka Power Corporation Limited (KPCL) 2x800 MW Godhana Thermal Power Station 2x800 MW Bidadi(Gas based) 1x700 MW rd Karnataka has five electricity supply companies: Bengaluru Electricity Supply Company Limited (BESCOM) Mangalore Electricity Supply Company Limited (MESCOM) Hubli Electricity Supply Company Limited (HESCOM) Gulbarga Electricity Supply Company Limited (GESCOM) Chamundeshwari Electricity Supply Corporation Limited (CESCOM) 3 Unit of Bellary Thermal Power Station 1x700 MW NTPC Project at Kudagi 4000 MW Total 10,200 MW Sources: Central Electricity Authority, Karnataka Budget 2013-14
  23. 23. Leading telecom companies operate in the state in the sectors of telecommunication network, basic telephony services (both wire line and wireless) and networking services for telecommunication equipment. According to Telecom Regulatory Authority of India (TRAI), there were 52.914 million wireless connections and 2.4 million wire-line subscribers in Karnataka, as of March 2013. Telecom infrastructure (March 2013) Wireless subscribers 52,914,789 Wire-line subscribers 2,443,394 Broadband subscribers 1,344,354* Post offices 9,760^ Telephone exchanges 2,799* Teledensity (in per cent) The entire state is networked via optic-fibre cables (OFCs) of the state-owned company, Bharat Sanchar Nigam Limited (BSNL), as well as private companies like Bharti, Reliance, VSNL and TATA Tele Services. Last mile access is provided by BSNL as well as Tata Tele Services in various parts of the state. Bharti and Reliance Communications provide the last-mile access, directly to the customers in all major cities of Karnataka. 91.3 Major telecom operators in Karnataka Bharti Airtel IDEA Cellular Vodafone Essar Bharat Sanchar Nigam Limited (BSNL) Aircel Ltd Reliance Communications Tata Teleservices Sources: Telecom Regulatory Authority of India, Department of Telecommunications, Annual Report 2012-13, Ministry of Communications and Information Technology, Economic Survey of Karnataka 2011-12, India Post *As of December 2011, ^As of January 2013
  24. 24. Under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM), Bengaluru and Mysore have been sanctioned 47 projects worth US$ 676.7* million during 2006-13. Water supply • KUWSDB has implemented surface-based drinking water supply schemes in 187 urban areas to provide assured safe drinking water. • KUWSDB is implementing 26 schemes for shifting the source of water from ground water to assured surface water. These schemes are to be completed by 2013. Some of the key areas of development are roads and flyovers, water supply, storm-water drainage, sewerage and urban transport. A total of 22 projects related to roads, flyovers, water supply and urban transport located in Bengaluru have been completed between April 2006 and May 2012, with a value of US$ 136.6 million. The Karnataka Urban Water Supply and Drainage Board (KUWSDB) is responsible for providing water supply and sewerage facilities in 213 urban areas of the state, except the areas serviced by the Bruhath Bengaluru Mahanagar Palike (which provides services in Bengaluru city and surrounding areas). • Cauvery Water Supply Scheme (CWSS) Stage IV, Phases I to IV are being implemented to supply 810 MLD of water to about 600,000 connections. Sewerage system • The Bengaluru Water Supply and Sewerage Board (BWSSB) is responsible for providing water supply, sewerage system and sewage disposal in the Bengaluru Metropolitan area. • 42 urban areas have been provided with underground drainage (UGD) facilities in the state. Sources: JNNURM, Ministry of Urban Development, www.urbanindia.nic.in MLD: Million litres per day *As of May 2013, at 2012-13 rates
  25. 25. Project name Investment (US$ million) PPP type Stage Bangalore International Airport 419.6 BOOT In operation Department of Ports & Inland Water 2nd stage development of modern deep sea port at Transport (DPIWT), Karnataka Karwar 166.2 BOOST Bidding DPIWT, Karnataka Honnavar Port Development, Uttar Kannada 239.1 BOOST Bidding DPIWT, Karnataka Development of Malpe Port in Udupi District 284.8 BOOST Bidding Construction of Ring Road Around Bengaluru City 652.2 BOT-Toll EOI Karnataka Road Development Corporation (KRDCL) Development of road from State Highway-17 to State Highway-19 307.2 BOT-Toll Bidding Karnataka Road Development Corporation (KRDCL) Development of road Sira-Madugiri-GowribidanurChikkaballapura-Shidalgatta-ChithamaniSrinivasapur-Mulbagal SH-58 and other connecting roads 309.1 BOT-Toll Bidding Contract authority Airports Ministry of Civil Aviation Ports Roads Bengaluru Development Authority Source: www.pppindiadatabase.com BOOT: Build-Own-Operate-Transfer, BOOST: Build-Own-Operate-Share-Transfer, BOT: Build-Operate-Transfer, EOI: Expression of Interest
  26. 26. Contract authority Project name Investment (US$ million) PPP type Stage Development of international convention centre at Devanahalli 221.5 BOTAnnuity Construction Tourism Department of Tourism, Karnataka Urban development 24x7 urban water supply 367.1 - In implementation Karnataka Land Army Corporation Limited (KLAC) Establishment of KLAC office 239.1 DBFOT Bidding Animal Husbandry and Veterinary Science Commercial development of animal husbandry and veterinary science land 55.3 DBFOT EOI Transfer station in Bengaluru 18.9 - EOI Karnataka Urban Infrastructure Development and Finance Corporation Bengaluru Mahanagara Palike, Karnataka Source: www.pppindiadatabase.com BOT: Build-Operate-Transfer, DBFOT: Design-Build-Finance-Operate-Transfer, EOI: Expression of Interest
  27. 27. The state has 21 operational, one valid in-principle approval and 61 formal approval SEZs, as of March 2013. Exports from SEZs in Karnataka (US$ billion) 5.3 The Karnataka Industrial Areas Development Board has developed 141 industrial areas spread all over the state. CAGR: 97.6*% The Karnataka State Industrial & Infrastructure Development Corporation has promoted over 135 start-up ventures in the state through equity participation and has provided debt to core industries such as steel, cement, mining and textiles, as well as new sectors such as IT, aerospace and telecom. 4.1 2.2 1.7 2011-12 2010-11 2009-10 Exports from SEZs in Karnataka grew at a CAGR of 97.6* per cent from US$ 0.4 billion in 2007-08 to US$ 5.3 billion in 2011-12. 2008-09 2007-08 0.4 SEZ with valid in-principle approval Name/Developer M/s. Ozone SEZ Developers Pvt Ltd Location Chikkaballapura Primary industry Pharmaceuticals Sources: www.sezindia.nic.in, Department of Industries and Commerce, Karnataka *Growth rate in INR terms
  28. 28. Some of the operational SEZs in Karnataka Name/developer Manyata Embassy Business Park Location Primary Industry Bengaluru IT/ITeS Varthur Hobli, Electronic City, Bengaluru IT Dakshina, Kannada IT/ITeS Vrindavan Tech Villages SEZ (Vikas Telecom Limited) Bengaluru IT/ITeS Cessna Garden Developers Pvt Ltd Bengaluru IT/ITeS Anekal, Bengaluru Biotechnology Bengaluru IT/ITeS Hasan Textiles Information Technology Park Ltd Bengaluru IT/ITeS Primal Projects Private Limited Bengaluru IT/ITeS Bagmane Construction Pvt Ltd Bengaluru North IT/ITeS Udupi Hi-tech engineering products and related services Samudravalli, Sankalapura Food processing Whitefield, Bengaluru IT/ITeS Belgaum Precision engineering products WIPRO Limited Infosys Technologies SEZ Mangalore Biocon Limited HCL Technologies Ltd KIADB (Textile) Synefra Eng. & Const. (Suzlon Infrastructure Limited) KIADB (Food) Gopalan Enterprises (India) Private Limited Quest SEZ Development Private Limited Source: www.sezindia.nic.in
  29. 29. Some of the SEZs with formal approvals Name/developer Location Primary Industry M/s. Biocon Ltd Bengaluru Biotechnology Karnataka Industrial Areas Development Board Mangalore IT/ITeS Dakshina Kannada IT/ITeS Karnataka Industrial Areas Development Board Shimoga Engineering & related industries Karnataka Industrial Areas Development Board Hassan Food processing and related services Bengaluru Biotechnology Near Mangalore Port Port-based for hi-tech engineering products and related services Hassan Pharmaceuticals Dakshin Kannada Petrochemicals and petroleum Quest Machining and Manufacturing Pvt Ltd Belgaum Auto, aerospace and industrial engineering High Street Developers Private Limited Mandya IT/ITeS Opto Infrastructure Limited Hassan Electronic hardware & software/ IT/ITeS Infosys Technologies Limited Karnataka Biotechnology and Information Technology Services Suzlon Infrastructure Ltd Karnataka Industrial Areas Development Board Mangalore SEZ Limited Source: www.sezindia.nic.in
  30. 30. The state has a literacy rate of 75.6 per cent according to the provisional data of Census 2011; the male literacy rate is 82.8 per cent and the female literacy rate is 68.1 per cent. Literacy rates (%) Literacy rate Male literacy There are 289 polytechnics and 187 engineering colleges to provide technical education in the state. 82.8 Female literacy The state has 3,640 pre-university colleges, 1,362 ‘other colleges’ and 40 universities to impart general education. There are about 0.968 million students in the pre-university colleges. 75.6 68.1 Educational infrastructure (No) • • • • • • • • • • • Universities: 40 Pre-university colleges: 3,640 Other colleges: 1,362 Engineering colleges: 187 Polytechnics: 289 Vocational institutes: 553 Medical colleges: 43 Dental colleges: 41 Ayurvedic colleges: 75 Homeopathy colleges: 12 Unani colleges: 4 Sources: Economic Survey of Karnataka 2011-12, University Grants Commission, Medical Council of India, Census 2011 (provisional data)
  31. 31. State participation in primary education is significant as 75.8 per cent of the primary schools are managed by Department of Education. Karnataka is home to several premier institutions: Indian Statistical Institute Indian Institute of Science Indian Institute of Management Karnataka education statistics (2011-12) Number of schools Lower primary: 25,951 Higher primary: 33,604 High schools: 13,862 School dropout rate (In per cent) Lower primary: 1.2 Higher primary: 4.4 Pupil-teacher ratio Lower primary: 14:1 Higher primary: 23:1 National Law School of India University Source: Economic Survey of Karnataka 2011-12 Institute for Social and Economic Change University of Agricultural Sciences, Bengaluru Kannada University, Hampi
  32. 32. Three-tier health infrastructure comprising primary health centres, health units, community health centres and subcentres is available in the state. The policy of the government is to establish one primary health centre for every 30,000 inhabitants, one dispensary for every 15,000-20,000 inhabitants, and one sub-centre for every 5,000 inhabitants. Health indicators (2011) Beds per 100,000 population (2010-11) 112 Birth rate* 18.8 Death rate* 7.1 Infant mortality rate** 35 Life expectancy at birth (years) Male (2002-06) Health infrastructure (as of December 2011) • • • • • • • District hospitals: 17 Other hospitals: 10 Community health centres: 326 Primary health centres: 2,310 Sub-centres: 8,871 Dispensaries: 659*** Beds in hospitals: 61,848 63.6 Female (2002-06) 67.1 Sources: Economic Survey of Karnataka 2011-12, Sample Registration System (SRS) Bulletin 2012 (www.censusindia.gov.in) *Per thousand persons **Per thousand live births ***As of March 2011
  33. 33. There are several sports complexes in Bengaluru, Mysore, Mangalore and other cities. Cricket, hockey and football are the major sports although, other games are also popular. The main sports arenas are the M. Chinnaswamy Stadium and the Sree Kanteerava Stadium in Bengaluru, Chamundi Vihar Stadium in Mysore and the Mangala Stadium in Mangalore. The Bengaluru Golf Course and the Karnataka Golf Association are well known golf courses in the state. Karnataka is also home to a number of convention centres, which are used for exhibitions, both indoor and outdoor, such as Palace Grounds and the Bengaluru International Exhibition Centre. Under the Rural Tourism Project, Anegundi, Kokkare Bellur, Attivari Bird Sanctuary, Gokarna and Kodagu have been developed. Schemes are being prepared to develop rural tourism at other places also to showcase the rural life, art and culture and heritage. Ranga Shankara and Karnataka Chitrakala Parishath form the cultural nexus of Bengaluru and are the performing spaces for dance, music and theatre artists. An international mega convention centre, with a seating capacity of 6,000, is being planned near the Bengaluru International Airport.
  34. 34. The natural resources, policy incentives and infrastructure in the state favour investments in the IT/ITeS, biotechnology, engineering, electronics, automotive, textiles, agri- and food-processing sectors. Key industries in Karnataka • • • Karnataka’s favourable policies have encouraged industries to set up their R&D centres in the state. • • • The state has about 366 R&D centres, the most in India. • • About 50 per cent of MNC R&D centres in India are based in Bengaluru. • • • Karnataka is making significant investments in industrial infrastructure, such as setting up industrial clusters and special economic zones (SEZs) and public-private partnership (PPP) projects to provide an impetus to further industrial development. • IT and ITeS Biotechnology Engineering Electronics and telecom Automotive Textiles and apparel Agro and food processing (floriculture) Aerospace Animation Electronic hardware Tourism Renewable energy
  35. 35. Electronics and software exports from Karnataka 28.3 CAGR: 19.2*% 17.3 17.9 2009-10 23.1 19.1 2007-08 Bengaluru is the 4th largest technological cluster in the world after Silicon Valley, Boston and London. 2008-09 Karnataka has emerged as an information technology (IT) hub of India. 12.5 Karnataka has 47 IT/ITeS SEZs investment regions. 2011-12 2006-07 The state is India’s largest software exporter, with electronics and computer software exports totalling US$ 28.3 billion in 2011-12. 2010-11 About 50.0 per cent of the world's SEI CMM Level 5 certified companies are located in Bengaluru. and dedicated IT Some of the key players There are 2,160 IT companies in the state. The state houses 5,50,000 IT Professionals, or 1/3rd of the total IT professionals in the country. At least 400 Fortune 500 companies have outsourcing operations in Karnataka. • • • • Wipro Technologies Infosys Genpact Accenture Sources: Software Technology Parks of India, Global Investors Meet 2012, KIADB, Department of IT, Govt of Karnataka, Karnataka ICT Group 2020 Report, Visvesvarya Industrial Trade Centre *Growth rate in INR terms
  36. 36. • Wipro Ltd • • Infosys Technologies Ltd • • Genpact • Accenture • • Wipro Ltd was established in 1945; and posted revenues of US$ 7.0 billion in 2012-13. It is present in areas of IT services, product engineering, technology infrastructure services, BPO and other consulting solutions. The company provides services such as application development, deployment and maintenance, business intelligence and customer-relationship management (CRM). Based in Bengaluru, the company has 72 plus global delivery centres and 50 plus industry specific ‘centres of excellence’ in over 54 countries. In September 2009, the company launched its Centre of Excellence on its Electronic City campus; to work with other leading IT firms to develop innovative IT solutions. Infosys Technologies Ltd was set up in 1981, and posted revenues of US$ 7.4 billion in 2012-13. The company is present in areas of IT consulting, modular global sourcing, process re-engineering and BPO services. The company has 68 offices and 70 development centres in US, India, China, Australia, Japan, UK, Germany, France, and many other countries; and has marketing and technological alliances with IBM, HP, Microsoft, Oracle, etc. It has operations at multiple locations at Bengaluru, Mangalore and Mysore in Karnataka. Genpact was set up in 1997 in India; formerly known as GE Capital International Services, the company’s net revenues in 2011 stood at US$ 1.6 billion. The company provides a wide range of business process, technology and knowledge services, including finance and accounting, collections and customer relations, insurance, procurement and supply chain, analytics, software and IT-infrastructure. The company employs around 55,400 employees. The company has one office in Bengaluru in Karnataka. Accenture is a global management consulting, technology services and outsourcing company, with more than 249,000 people serving clients in more than 120 countries. The company has one consulting office and seven delivery centres in Bengaluru.
  37. 37. Karnataka has played a key role in India’s emergence as a significant player in the global biotechnology industry. Karnataka is home to nearly 60.0 per cent of the country’s biotech units. Some of the key players • • 195 out of the total 340 biotech companies in India are located in Karnataka. Karnataka has over 6,800 scientists involved in biotech research. Premier life sciences institutions such as Indian Institute of Science, National Centre for Biological Science, Jawaharlal Nehru Centre for Advanced Scientific Research, etc., are present in the state. Karnataka has sector-focused SEZs in Mysore, Mangalore, Hubli-Dharwar, Belgaum, Shimoga, Gulbarga, Kolar & Mandya. 12 biotechnology finishing schools are scheduled for development under the Millennium Biotech Policy. An 86-acre biotechnology park, Bengaluru Helix, comprising the 52-acre Alexandria Knowledge Park, is due to come up in Bengaluru. • • Biocon AstraZeneca India Jubilant Life Sciences Ltd GlaxoSmithKline Pharmaceuticals Ltd Sources: Global Investors Meet 2012, Indian Biotechnology Industry Outlook 2012, Analyz Research, Visvesvarya Industrial Trade Centre
  38. 38. Biocon • Biocon India was incorporated in 1978 as a joint venture between Biocon Biochemicals Ltd of Ireland and an Indian entrepreneur, Kiran Mazumdar-Shaw. It is among the leaders in biopharmaceuticals and bio-services. It has its corporate headquarter at Bengaluru. • The company’s revenue was about US$ 447 million in 2012-13. • AstraZeneca India AstraZeneca India was established in 1979. The company is involved in the areas of manufacturing/marketing of bulk drug chemicals, liquid formulations, tablets and capsules, injectibles and ointments for various disease segments such as cardiovascular, respiratory, maternal healthcare, etc.. • The company’s manufacturing plant is located at Yelhanka and R&D centre is located in Bengaluru. Jubilant Life Sciences Ltd • GlaxoSmithKline Pharmaceuticals Ltd • Jubilant Life Sciences Limited (formerly Jubilant Organosys Ltd) is an integrated pharmaceuticals and life sciences company. It is the largest custom research and manufacturing services (CRAMS) company and provides leading drug discovery & development solutions outside India. • The company has a manufacturing facility in Nanjangud, with around 625 employees. GlaxoSmithKline Pharmaceuticals Ltd was established in 1924; it is one of the oldest pharmaceutical companies in India. • The company’s revenue was about US$ 482.7 million in 2012-13. • GSK India product portfolio includes prescription medicines and vaccines. The company has a clinical development centre in Bengaluru.
  39. 39. The engineering industry in Karnataka prospects, given its performance. has positive Some of the key players • In 2011-12, the export of engineering products stood at US$ 1.7 billion. • • • Exports include machine tools, industrial machinery, cutting tools, castings, automotive components, electrodes, welding equipment, construction and earthmoving equipment, and helicopter spares. A number of engineering exporters are based in Bengaluru, Hubli, Mysore, Belgaum, Mangalore, and Shimoga. A 300-acre SEZ has been created in Belgaum to develop a precision engineering and manufacturing supply chain ecosystem, which would be a great driver for manufacturing industries. Bharat Earth Movers Limited, Hindustan Machine Tools Limited and Bharat Heavy Electricals Limited are among the leading companies in this sector in the state Bharat Earth Movers Limited (BEML) Hindustan Machine Tools Limited (HMT) Bharat Heavy Electricals Limited (BHEL) Saint-Gobain India Source: VITC-NCTI Trade Info
  40. 40. BEML Limited • HMT Ltd • BHEL • Saint-Gobain India BEML Limited (formerly Bharat Earth Movers Limited) was established in 1964. BEML manufactures a wide range of earth moving and other heavy industrial equipment for the mining and civil engineering industries. • BEML has its registered office at Bengaluru and units at Kolar Gold Fields, Mysore and Bengaluru. HMT was established in 1953. The company manufactures various types of machine tools including watches, tractors, printing machinery, metal forming presses, die casting & plastic processing machinery, CNC systems & bearings. • The company has a manufacturing plant in Bengaluru. Bharat Heavy Electricals Ltd (BHEL) is the largest engineering and manufacturing enterprise in India in the energy-related/infrastructure sector. It has 15 manufacturing divisions, two repair units, four regional offices, eight service centres, eight overseas offices and 15 regional centres. • BHEL has its electronics division at Bengaluru. • Saint-Gobain India was established in India in 1996. The group comprises eight manufacturing companies in India for a variety of products ranging from glass to engineering products. • The company has a manufacturing plant in Bengaluru.
  41. 41. Karnataka is a leading state of the country in electronics and telecommunication with over 300 of the world’s leading companies. Some of the key players • • The state has high end research and development organisations like Indian Institute of Science, Cosmic Industrial Laboratories Ltd, Indian Space Research Organisation (ISRO), CSIR Centre for Mathematical Modelling and Computer Simulation (CMMACS), National Aerospace Laboratories, Centre for Soft Matter Research and John F. Welch Technology Centre. It has excellent telecom infrastructure with 140 out of 170 towns connected by Optic Fibre Cables (OFC) network. Bengaluru district is the major hub of electronics and telecommunications industries. The other districts of Hassan, Tumkur, Mysore, Mangalore and Shimoga are the new destinations for promotion of electronics and hardware industries. The state houses global giants such as Sanyo, AT&T, Siemens, GE, Motorola, Sony, and Alcatel as well as national heavyweights such as BPL Limited and Indian Telephone Industries Limited. • • Bharat Electronics Ltd Nokia Siemens Philips Electronics India Ltd Source: Department of Industries and Commerce
  42. 42. Bharat Electronics Ltd • Nokia • Siemens • Philips Electronics India Ltd • Bharat Electronics Limited (BEL) was incorporated in 1954 and is a multi-product, multi-unit, multi-technology company. Products manufactured by BEL are mainly categorized as systems/turnkey solutions, defence and non-defence products. • The company has a manufacturing unit at Bengaluru, Karnataka. Nokia is among the world leaders in mobile technology. The company started its India operations in 1995. India holds the distinction of being the second largest market for the company globally. • It has an R&D facility and a design studio in Bengaluru. Siemens set up operations in India in 1957. The Siemens Group in India is a unique player in the field of electrical and electronics engineering, employs over 18,000 people and has 21 manufacturing facilities in India. It has several offices in Bengaluru. Philips is present in India for over 75 years. It is a leader in consumer electronics, healthcare and lighting systems; the company employs over 4,500 people in India. • The company has an R&D facility – Philips Innovation Campus – at Bengaluru.
  43. 43. Karnataka has a vibrant auto industry with investments of around US$ 713.0 million and annual revenues of US$ 604.0 million. It is the fourth largest state in India in terms of automotive production. The government is in the process of announcing a Dedicated Automobile Policy. The sector attracted US$ 2.0 billion* of investments during the Global Investors Meet 2012. The main locations for automobile industries are Bengaluru, Ramanagara, Kolar, Shimoga, Dharwad and Belgaum. Some of the key players • General Motors Technical Centre, located in Bengaluru, is actively involved in research, design, analysis and development of vehicles and powertrains for foreign destinations as well as the domestic market. Toyota, Volvo, Tata Marcopolo and TVS Motors have set up vehicle manufacturing units in Karnataka, which has led to the growth of ancillary units involved in manufacturing tyres, bearings and other auto spare parts. The state has 3 auto clusters, 1 industrial valve cluster and one auto component cluster. Two manufacturing hubs are coming up in Narsapur and Vemagal Industrial Areas in Kolar District. • • • Toyota Kirloskar Volvo India TVS Motor Company Delphi Automotive Systems Pvt Ltd Source: Global Investors Meet 2012 *At 2011-12 rates
  44. 44. Toyota Kirloskar • Toyota Kirloskar is a joint venture between Kirloskar group and Toyota Motor Corporation. • The company has manufacturing facilities at Bidadi. Volvo India TVS Motor Company Delphi Automotive Systems Pvt Ltd • Volvo India has a state-of-the-art bus manufacturing unit near Bengaluru. Globally, the Volvo Group has about 100,000 employees, production facilities in 20 countries, and sales activities in over 190 countries. • In 2009, the Bengaluru bus plant delivered over 600 buses, a 50.0 per cent increase over 2008. • • TVS Motor Company is one of the largest two-wheeler manufacturers in India. It is the flagship company of the TVS Group. The company has four manufacturing plants across India, including Mysore in Karnataka. Delphi India was incorporated in 1995 as a wholly owned subsidiary of Delphi. It is a leading global supplier of electronics and technologies for automotive, commercial vehicles and other market segments. • The company has a technical centre at Bengaluru, which is the largest technical centre outside the US.
  45. 45. Karnataka is one of the leading producers of cotton, silk and wool, which are the key raw materials required for textile manufacturing units. The state produces 65.0 per cent of India’s silk. The state plans to develop a 230-acre textile SEZ in Hassan, dedicated apparel zones in Bengaluru Rural, Tumkur, Kolar, Mandya, Belgaum, Bidar, and Dharwad, and a Silk City in Bengaluru. Karnataka is a major apparel sourcing destination for the global market. The state accounts for 20.0 per cent of the national garment production. Bengaluru houses reputed international companies such as Nike, Tommy Hilfiger, GAP, Donna Karan, Walmart, Jones, and Liz. The state hosts over one million power looms. There are approximately 0.38 million manufacturing units engaged in the textiles and garments sector at the organised and unorganised level. Some of the key players • • • • Gokaldas Exports Limited Karnataka Silk Industries Corporation (KSIC) Himatsingka Seide Shahi Exports Private Limited It has 105 skill development centres and 240 private training centres funded by the Department of Handloom. Source: VITC-NCTI Trade Info, Global Investors Meet 2012 The Textile Policy offers various incentives for investments in the textile sector; these include credit linked capital subsidy, entry tax reimbursement, and power subsidy. The sector has potential for future growth. Karnataka has an apparel park at Dodaballapur near Bengaluru and other mega textile parks in the other parts of the state.
  46. 46. Gokaldas Exports Ltd KSIC Himatsingka Seide Shahi Exports Pvt Ltd • Gokaldas is one of the largest garment exporters in the country. It commenced operations in 1979. • Headquartered in Bengaluru, the company has 29 factories across Karnataka. The company employs around 32,000 people. It has a manufacturing capacity of 2.5 million garments per month. • Karnataka Silk Industries Corporation (KSIC) is a Government of Karnataka enterprise. It is a leading manufacturer of silk. • The company has two modern factories located in T. Narasipura & Mysore, engaged in manufacturing silk goods right from raw silk yarn to silk fabrics. • Himatsingka Seide was incorporated in 1985. It is a Bengaluru-based company and deals in natural silk fabric. • The company’s focus area is textile designing and manufacturing. It has a spinning division as well as a weaving division. The company’s brand ‘Atmosphere’ is India’s first luxury home textile brand, with an exclusive collection of over 2,500 products. • Shahi Exports is among the top home furnishing exporters in the country. The company began operations in 1974 in Delhi and started manufacturing in Bengaluru in 1988. It has manufacturing facilities in Delhi, Bengaluru, Salem and Tirupur
  47. 47. Most of the civil infrastructure work has been established in Malur, Hiriyur, Bagalkot and Jewargi food parks, which had been approved by Ministry of Food Processing Industries, Government of India. Karnataka is the largest producer of coffee and cocoa in the country. Coffee exports from Karnataka (US$ million) Government of Karnataka had approved the establishment of food parks in six districts; Bengaluru rural, Tumkur, Shimoga, Davangere, Bijapur and Belgaum. These parks are in advanced stages of implementation. 262 2011-12 2007-08 The state is one of the leading producer of flowers, spices, fruits and vegetables. 402 291 2010-11 241 2009-10 The state accounts for around 70.0 per cent of the country’s total coffee production. In 2011-12, the coffee production in the state was estimated to be at around 221,000 metric tonnes. Some of the key players • A spice park is proposed to be developed at Byadagi in Haveri district. 584 CAGR: 24.8% 2008-09 Karnataka, with a good agricultural base including a variety of food crops, offers immense scope for the development of food processing industries. • • • Hindustan Unilever Limited Nestle India Britannia Industries Limited United Breweries Group Sources: Visvesvarya Industrial Trade Centre, Global Investors Meet 2012
  48. 48. Hindustan Unilever Ltd • Nestle India • Nestle has been in India for almost a century, with seven production facilities across the country, including one at Nanjangud, Karnataka. It produces chocolates and confectionaries, prepared dishes and cooking aids, beverages and milk products and nutrition supplements. Britannia Industries Ltd • Britannia is a leading food processing company in India. The company manufactures food products such as biscuits, cheese and bread. Based in Bengaluru, the company had a revenue base of US$ 1.1 billion in 2012-13. United Breweries Ltd • Hindustan Unilever Limited (HUL) is India's largest fast moving consumer goods (FMCG) company, with leadership in home & personal care products and foods & beverages. It recorded revenues of US$ 4.9 billion during 2012-13. The company employs over 16,000 people nationwide. • The company has a manufacturing plant and an R&D centre at Bengaluru. United Breweries Limited is a flagship company of the UB Group. The company is also referred to as the beer division of the UB Group and it is based in Bengaluru. It has recorded a net turnover of US$ 659.0 million in 2012-13. • The company has around 2,489 employees. It manufactures products, primarily, under the brands Kingfisher, London Pilsner and UB Premium Ice.
  49. 49. Karnataka produces more than a quarter of India’s aircraft and spacecraft. Some of the key players • Around 984 acres of land is earmarked for an exclusive industrial area and sector-specific SEZ for aerospace industries near Bengaluru International Airport. India’s first aerospace SEZ of 300 acres is operational at Belgaum. Karnataka Aerospace Policy has identified an investment potential of US$ 12.5* billion in this sector during 2013-2023 and plans to develop aerospace clusters in different regions of the state. Companies like Air India, Boeing and Jupiter Aerospace have selected Karnataka for the development of MRO facilities. • • • Boeing Hindustan Aeronautics Limited Airbus Engineering Centre BEML Ltd Sources: Global Investors Meet 2012, MRO India, NRI Forum Karnataka, Karnataka Aerospace Policy 2012 Ministry of Civil Aviation, India *At 2011-12 rates
  50. 50. Boeing • HAL • Airbus BEML Ltd In India, Boeing is represented through its wholly owned subsidiary, Boeing International Corporation India Private Limited (BICIPL). • Boeing established its first R&D centre in India – the Boeing Research & Technology Centre – in Bengaluru, Karnataka in 2009. The centre develops high end technology solutions, particularly in the areas of aero structures and avionics. Hindustan Aeronautics Limited (HAL) is ranked 40th in Flight International's list of the World’s Top 100 aerospace companies in 2008. • HAL, has 19 production units and 9 research and development centres in 7 locations across India; of which, 8 production units and 4 R&D centres are located in Bengaluru. Airbus’ industrial cooperation with India began in 1988, when an agreement was reached with Hindustan Aeronautics Limited (HAL) to manufacture passenger doors for the A320 aircraft. • Specialising in high-tech aeronautical engineering, the Airbus Engineering Centre works hand-in-hand with other Airbus engineering offices around the world, as well as with the Indian aviation industry. • Bharat Earth Movers Limited (BEML), a ‘Miniratna-Category-1’, plays a pivotal role and serves India’s core sectors like defence, rail, power, mining and infrastructure. • BEML is involved in the manufacturing of aircraft components/assemblies and MRO activities related to aerospace applications. • Sources: Global Investors Meet 2012, KUM Karnataka, Airbus, BEML Ltd
  51. 51. The state has 20 institutes that are imparting AVGC related training to more than 10,000 students. Some of the key players • Major suppliers to the industry like HP, AMD, NVIDIA and Microsoft are located in Bengaluru. • • • Technicolor TATA Elxsi Zynga DreamWorks There has been a considerable increase in AVGC business outsourcing to Bengaluru. A lot of content for global blockbuster animation movies like Life of Pi, Harry Potter, Kung fu Panda, Prometheus, Pirates of the Caribbean, among others, was developed in Karnataka. There is a plan to set up AVGC parks, similar to the SEZ model. A plan has been formulated to set up a venture capital fund and a centre of excellence to provide common resources for IP creation. An adequate extent of land is to be earmarked for the AVGC sector in the proposed Integrated Information Technology Investment Region (ITIR) near Bengaluru International Airport. Sources: PwC report estimates, Karnataka AVGC Policy *Forecasted AVGC: Animation, Visual effects, Gaming and Comics
  52. 52. Technicolor Tata ELXSI Zynga Inc • Technicolor is a worldwide technology leader in the media and entertainment sector with revenues of approximately € 3.5 billion in FY 2012 (January to December). • Technicolor India offers world-class design and production services in animation and visual effects for motion pictures and television broadcast productions. • Technicolor has been operating in India since 2007 and employs more than 950 people. • Tata Elxsi is a listed company, and it is headquartered in Bengaluru. • It is a global design company and offers key services including embedded product design, industrial design, animation & visual effects and systems integration. • Zynga Inc is the world's leading provider of social gaming services with more than 240 million monthly active users playing its games, which include CityVille, Zynga Poker and Scramble with Friends, among others. • Zynga's Bengaluru centre, started in 2010, has rapidly expanded to become the company's second largest operation in the world, after its San Francisco centre. • DreamWorks DreamWorks Animation creates high-quality entertainment, including CG animated feature films, television specials and series and live entertainment properties. • DreamWorks Animation has been named one of the “100 Best Companies to Work For” by FORTUNE® Magazine for four consecutive years. • The company has theatrically released a total of 25 animated feature films, including the franchise properties of Shrek, Madagascar, Kung Fu Panda and How to Train Your Dragon. Sources: Technicolor, TATA Elxsi, Zynga, DreamWorks
  53. 53. 80 out of the 120 companies engaged in chip designing in India are located in Karnataka. Some of the key players • The state has the advantage of having relatively low cost skilled/technical manpower as compared to other states. • • • Bengaluru is a global hub for R&D activity in the software industry, which will greatly aid the electronic hardware industry. The ESDM Policy is expected to provide for development of three ESDM innovation centers that will provide complete infrastructure with the requisite design tools. ESDM Policy also plans to set up 7 high class ESDM manufacturing clusters (EMC) to provide infrastructure support including electronic manufacturing services and component manufacturing by 2020. Intel AMD Qualcomm Inc Nvidia Sources: Department of Electronics and Information Technology, GoI, Department of IT, BT and S&T, Karnataka; ESDM Policy, Karnataka
  54. 54. Intel AMD Intel, headquartered in Santa Clara, is the world’s largest and highest valued semiconductor chip maker, based on revenue. • The Intel India Development Centre is a critical engineering design and development centre for key Intel products across CPUs, graphics, platforms, and software with strong IT expertise and factory automation. • AMD India plays a significant role in the design of microprocessors, AMD’s family of Accelerated Processing Units (APU), SoCs, graphics and media solutions. • AMD has two design centers in India, located in Hyderabad and Bengaluru. • Qualcomm Inc • NVIDIA • Qualcomm Incorporated is an America-based global semiconductor company that designs, manufactures and markets digital wireless telecommunications products and services. • Qualcomm India Private Limited established its India operations in 1996 and has R&D centres in Bengaluru and Hyderabad. Nvidia manufactures graphics processing units (GPUs), as well as system-on-a-chip units (SOCs) for the mobile computing market. • Nvidia established its design centre in Bengaluru in 2005. The centre includes a state-ofthe-art facility and data centre that facilitate top-to-bottom designing of advanced graphics and digital media processors for a wide range of platforms. Sources: Intel, AMD, Qualcomm Inc, Nvidia
  55. 55. Karnataka boasts of a diverse flora and fauna and a 320 km natural coast line, which makes it a nature tourist's paradise. Number of tourist arrivals in Karnataka (million) 84.68 The state is ranked fourth in terms of the number of tourist arrivals in India. The Palace on Wheels of South India – the Golden Chariot Train tour – has been rated by Vanity Fair, UK, as amongst the top seven train journeys in the world. CAGR: 22.4% 36.7 38.36 37.53 2006 2007 2008 33 38.53 25.24 Karnataka has World Heritage Sites at Hampi and Pattadakal. 2005 Good infrastructure in the form of better road and rail connectivity as well as improving hospitality is also aiding tourism. The state attracted 84.1 million domestic tourists and 0.57 million international tourists in 2011. Tourist arrivals have increased at a CAGR of 22.4 per cent during 2005-2011. Contributes 15.0 per cent to GSDP of Karnataka; plans are afoot to expand it to 25.0 per cent by 2020. 2009 2010 2011 Sources: Global Investors Meet 2012, Department of Tourism, Karnataka
  56. 56. Major attractions Karnataka is India’s most preferred destination for advanced medical care, and is referred to as the medical tourism hub of India. • It has the highest number of approved health systems, multi-specialty health centres and alternative health therapies in India. • Medical tourism The state represents wide variations in topography – high mountains, hills and long coastal stretches. • It has 5 national parks, 26 wild life sanctuaries, pelicanries, heronries and elephant camps. • Eco tourism Karnataka’s geography provide a vast spectrum of diverse attractions, making it a heaven for adventure sports and outdoor activities. • Major attractions include white water rafting on the Kali river and aero sports at the Nandi hills. • Adventure tourism Sources: Visvesvarya Industrial Trade Centre, Global Investors Meet 2012
  57. 57. Renewable energy contributes nearly 25.0 per cent of the state’s installed power capacity. Karnataka is endowed with high renewable energy potential like wind, hydro, solar, tidal, geothermal energy resources etc. The renewable energy potential for the state is estimated at 28 GW, primarily from wind, small hydro, co-generation and biomass sectors. The government has allotted projects of 16,380 MW, amounting to nearly 68.6 per cent of the total potential. Renewable Energy Policy plans to set up renewable energy economic zones by procuring 10.0 per cent of the land of SEZs and dedicating it for renewable energy. It also mandates to keep aside 10.0 per cent of barren government land for renewable energy.
  58. 58. Capacity Capacity Renewable Capacity Pending commissioned Capacity due for commissioned energy potential allocated applications during current commissioning cumulative (MW) (MW) (MW) financial year (MW) (MW) (MW) No Renewable energy source 1 Wind 13,236 11,460.5 3,014.2 115.5 2,216.71 7,298.70 2 Hydro 3,000 2,851.5 201.4 0 701.41 1,830.49 3 Biomass 1,000 362.4 62.08 0 90.94 265.5 4 Waste to energy 135 15.5 40.89 0 0 15.5 5 Cogeneration 1,500 1,591.2 147 0 1,111.11 451.29 6 Solar grid 5,000 99 1,501.0 10.0 24 65 Grand total 23,871 16,380.1 4,966.6 125.5 4,144.2 9,926.5 Sources: KREDL, Central Electricity Authority, Karnataka Renewable Energy Policy
  59. 59. Wind energy Karnataka wind energy density map Karnataka has the largest wind energy potential of 13,236 MW in India. The state has just 2,197 MW of installed wind capacity; this provides a huge opportunity to harness the untapped potential of the market. Wind velocity in the state ranges from 0.85m/s to 8.27 m/s. Potential areas for wind power plants in the state include Chitradurga, Gadag, Chikmaglur, Bellary, Davangere, Koppal, Bijapur, Bagalkot, Belgaum etc. Wind power density W/Sq m 0 – 100 100 – 200 200 – 250 250 – 300 300 – 400 400 – 500 Source: Centre for Wind Energy, Chennai Sources: KREDL, Global Investors Meet 2012
  60. 60. Solar energy Karnataka solar resource map Solar Policy 2011-16 envisages to add 40 MW of capacity each year. Many districts, especially coastal areas, receive solar radiation in the range of 5.1-6.4 kWh/m2 during summer, which is best suited for solar PV projects. 126 MW solar capacity is to be added in 2013-14. The central government’s policy mandates that solar energy consumption should increase to 3.0 per cent of the total consumption by 2022, up from the present requirement of 0.25 per cent. Karnataka is the only state to have supported solar projects under the REC (Renewable Energy Certificate) mechanism. Source: http://solargis.info/doc/71 Sources: Karnataka Solar Policy 2011, Global Investors Meet 2012
  61. 61. Agency Description Contact information • • Responsible for formulating industrial policies in the state. It is the single contact point for investors in the state. • Karnataka Udyog Mitra (KUM) Anchor department for development/establishment of industries in Karnataka. • Department of Industries and Commerce (DIC) Considers/forwards proposals to concerned agencies and communicates status to investors. • Monitors implementation of approved projects. • Single point contact for information on various aspects including land availability, statutory approvals and coordination. No 49, South Block, Khanija Bhavan Race Course Road Bengaluru - 560 001 Phone: 91-80 2238 9901-08 Fax: 91-80-2238 9909 E-mail: commissioner@karnatakaindustry.gov.in Website: www.karnatakaindustry.gov.in and implementing No 49, South Block, Khanija Bhavan East Entrance, Race Course Road Bengaluru - 560 001 Phone: 91-80-2228 2392/5659, Fax: 91-80-2226 6063 E-mail: md@kumbangalore.com Website: www.kumbangalore.com
  62. 62. Agency Description District Level Single Window Clearance Committee (DLSWCC) • Functions under the chairmanship of respective Deputy Commissioners for industrial projects for investments less than US$ 0.65 million. State Level Single Window Clearance Committee (SLSWCC) • Functions under the chairmanship of Minister for Large and Medium Industries for investments that range between US$ 0.65-10.9 million. State High Level Clearance Committee (SHLCC) • Functions under the chairmanship of the Chief Minister for projects involving investment of more than US$ 10.9 million. • Nodal agencies for approval of projects at district level. • The primary focus of the agency is to promote small scale, village and cottage industries. • There are various sector-specific departments such as Department of Tourism, Department of Information Technology and Biotechnology, Department of Food Processing, Department of Textiles, Department of Mines and Geology. District Industries Centres Other departments
  63. 63. List of approvals and clearances required Departments to be consulted Prior to setting up the unit Registration Department of Industries and Commerce Department, Karnataka Udyog Mitra (Single Window Agency) Allotment of land/shed Karnataka Industrial Areas Development Board Permission for land use District Authorities No objection certificate under Water and Air Act Karnataka State Pollution Control Board Approval for construction activity and building plan Development Authority/Urban Local Body No objection certificate Fire Department and Directorate of Factories and Boilers Provisional trade tax registrations Central and State Excise Departments Registration under Central Sales Tax Act Central and State Excise Departments
  64. 64. List of approvals and clearances required Departments to be consulted Before commencement of production No objection certificate under Water and Air Act State Pollution Control Board No objection certificate Fire Department and Directorate of Factories and Boiler Permanent Trade Tax registration Central and State Excise Departments Registration under Central Sales Tax Act, 1956 Central and State Excise Departments After commencement of production/activity Registration Department of Industries and Commerce and respective sector departments such as IT/BT/Tourism etc.
  65. 65. Stage 1 Clearance of the project/industry State Level Single Window Agency (Large/mid-size industries US$ 0.65 – 10.9 million) Stage 2 Clearance High Level Clearance Committee (Mega industries > US$ 10.9 million KIADB (Land acquisition) Karnataka Udyog Mitra (Department of Industries and Commerce) Other sector-specific departments KSPCB (Pollution Board) KPTCL (Electricity) Inspectorate of Factories and Boilers Commercial Tax District Industries Centre (Tiny industries < US$ 0.65 million) Investor Land conversion BWSSB/KUWSDB (Water supply) Source: Karnataka Udyog Mitra, Karnataka Industrial Areas Development Board and Department of Industries & Commerce
  66. 66. Cost parameter Cost estimate Industrial land (per sq ft) US$ 4.5 to US$ 120 Power cost (per kWh) Industrial: US 8.3 cents to 11.5 cents Commercial: US 11.8 cents to US 15.0 cents Labour (minimum wage per day) US$ 2.8 to US$ 3.6 Water (per kilolitre) Bengaluru Metropolitan Area: Non-domestic: US 75 cents to US 125 cents Industries: US$ 1.25 Sources: Industry sources, Ministry of Labour and Employment, Government of India, Bengaluru Water Supply and Sewerage Board, Karnataka Electricity Regulatory Commission
  67. 67. ESDM Policy 2013 Objective • To facilitate, promote and develop the ESDM sector in Karnataka and make Karnataka a preferred destination for investment in this sector. Read more Aerospace Policy 2012 Objectives • • To position Karnataka as a vibrant aerospace hub of Asia and a globally recognised aerospace destination by enabling the environment for holistic and sustained growth of the aerospace sector Increase the contribution of the aerospace sector towards enhancing the share of industry in the state’s GSDP from 28.0 per cent to 32.0 per cent by 2022. Read more AVGC Policy 2012 Objective • Encourage and support appropriate manpower development, infrastructure development and business development in the AVGC sector. Read more
  68. 68. Information and Communication Technology Policy 2011 Objectives • • • To maintain Karnataka’s leadership in outsourced IT services. To retain Karnataka’s position as the state with the largest skilled workforce in India for IT services, products and R&D. To enable Karnataka to be the most preferred destination for MSMEs (micro, small and medium enterprises). Read more Integrated Agribusiness Development Policy 2011 Objective • To position Karnataka on a sustained growth path in the field of agricultural and allied sectors through global technologies and innovative tools, by creating enabling frameworks and state-ofthe-art infrastructure facilities, thereby generating higher returns for farming communities. Read more Karnataka Renewable Energy Policy 2009-14 Objectives • • Development, propagation and promotion of renewable energy resources and technologies. Creation of a suitable environment for private sector participation in renewable energy power generation. Read more
  69. 69. Karnataka Industrial Policy 2009-14 Objective • To build a prosperous Karnataka through development of human and natural resources in a systematic, scientific and sustainable manner. Read more Karnataka Tourism Policy 2009-14 Objective • To make tourism Karnataka’s principal and largest economic activity as an employer, revenuegenerator and engine of growth, by being among the top two tourism destinations in India by 2016-17. Read more State Policy for Special Economic Zones 2009 Objective • To facilitate and expedite establishment of SEZs, at the same time safeguarding the environment and the interests of land owners. Read more
  70. 70. Millennium Biotech Policy II 2009 Objective • To increase the quality of human resources by supporting education and research institutions like the Institute of Agri-Biotechnology (IABT), the Institute of Bioinformatics and Applied Biotechnology (IBAB), the Centre for Human Genetics (CHG) and BT finishing schools; to create specific infrastructure such as focused biotech parks in the areas of agriculture, marine biotech and animal husbandry; to provide specific fiscal incentives. Read more Karnataka Mineral Policy 2008 Objectives • • • To optimise the state’s geological potential by scientific and detailed prospecting. State-of-the-art techniques will be encouraged by combining the resources of the private and public sectors. To resolutely pursue the policy of preserving flora, fauna, and bio-diversity and ensure that the invaluable forest wealth is safeguarded while granting mineral concessions. To promote transparency in granting mining concessions. Priority will be given to the applicants who propose establishment of industries for value addition within the vicinity of the mineral bearing areas. Read more
  71. 71. Suvarna Vastra Neethi 2008-13 (Textile Policy) Objectives • • To achieve balanced, higher and sustainable growth in the entire textile value chain. To facilitate emerging units in critical areas such as production technology, market research, and development in order to exploit global and domestic trade opportunities. Read more Infrastructure Policy 2007 Objective • To provide a fair and transparent policy framework to facilitate the process of economic growth and encourage public-private partnerships (PPP) in infrastructure. Read more
  72. 72. Exchange rates Year INR equivalent of one US$ 2004-05 44.95 2005-06 44.28 2006-07 45.28 2007-08 40.24 2008-09 45.91 2009-10 47.41 2010-11 45.57 2011-12 47.94 2012-13 54.31 Average for the year
  73. 73. India Brand Equity Foundation (“IBEF”) engaged Aranca to prepare this presentation and the same has been prepared by Aranca in consultation with IBEF. All rights reserved. All copyright in this presentation and related works is solely and exclusively owned by IBEF. The same may not be reproduced, wholly or in part in any material form (including photocopying or storing it in any medium by electronic means and whether or not transiently or incidentally to some other use of this presentation), modified or in any manner communicated to any third party except with the written approval of IBEF. This presentation is for information purposes only. While due care has been taken during the compilation of this presentation to ensure that the information is accurate to the best of Aranca and IBEF’s knowledge and belief, the content is not to be construed in any manner whatsoever as a substitute for professional advice. Aranca and IBEF neither recommend nor endorse any specific products or services that may have been mentioned in this presentation and nor do they assume any liability or responsibility for the outcome of decisions taken as a result of any reliance placed on this presentation. Neither Aranca nor IBEF shall be liable for any direct or indirect damages that may arise due to any act or omission on the part of the user due to any reliance placed or guidance taken from any portion of this presentation.