Indian Industry Plus A Pratisrutiplus Suppliment
Odisha has always endeavored to provide a hassle-free business environment to investors. A number of reforms have been carried out by various Departments of the State Government in the recent past. Integration of business related services with the e-Biz portal is in place. Odisha is the first state in India to launch a synchronized Central Inspection Framework for all industrial establishments.
India, a South Asian nation, is the seventh largest country by area and the second most populous democracy in the World. India boasts of an immensely rich cultural heritage including numerous languages, traditions and people. The country holds its uniqueness in its diversity and hence has adapted itself to international changes with poise and comfort. While the economy has welcomed international companies to invest in it with open arms, since liberalization in 1990s, Indians have been prudent and proactive in adopting global approach and skills. Indian villagers proudly take up farming, advanced agriculture & unique handicrafts as their profession on one hand, while modern industries and professional services sector are coming up in a big way on the other. Thus the country is attracting many global majors for strategic investment owing to the presence of vast range of industries, investment avenues and a supportive Government. Huge population, mostly comprising the youth is a strong driver for demand and an ample source of manpower.
Emerging India is the fastest growing major economy in the world as per Central Statistics Organisation (CSO) and International Monetary Fund (IMF). As per the latest economic survey, the Indian economy will continue to grow more than 7 percent in 2016-17. India’s Consumer Confidence Score is quite high (128) and the economy is expected to grow at 7.75% during FY 2016-17. According to Fitch Rating Agency, India’s Gross Domestic Product (GDP) will likely to grow by 7.7 percent in FY 2016-17 and slowly accelerate to 8 percent by FY 2018-19 driven by the gradual implementation of structural reforms, higher disposable income and improvement in economic activity. Numerous Foreign Companies are setting up their facilities in India on account of various Government initiatives like Make in India and Digital India. Mr. Narendra Modi, Prime Minister of India has launched the Make in India initiative with an aim to boost the manufacturing sector of Indian economy. The initiative is expected to increase the purchasing power of an average Indian Consumer, which would further boost demand and hence spur development, in addition to benefiting investors. Besides this, the Government has also come up with Digital India initiative which focuses on three core components; Creation of digital infrastructure, delivering services digitally and to increase digital literacy. Currently the manufacturing sector in India contributes over 15 percent of the GDP. The Government under the Make in India initiative is trying to give boost to the contribution made by the manufacturing sector and aims to take it up to 25 percent of the GDP.
Make in India
Make in India is a major new national programme of the Government of India designed to facilitate investment, foster innovation, enhance skill development, protect intellectual property and build best in class manufacturing infrastructure in the country. The programme is being led by the Department of Industrial Policy & Promotion (DIPP), Ministry of Commerce & Industry. The Make in India is a very important concept for the economic growth of India as it aims in utilizing the existing Indian talent base, creating additional employment opportunities and empowering secondary & tertiary sector. This programme also aims at improving India’s rank on the “Ease of Doing Business” index by eliminating unnecessary laws & regulations, making bureaucratic processes easier, making the Government more transparent, responsible and accountable. In an era of liberal economy this provides an opportunity to the world to set up their manufacturing sectors in India. The entire focus of Make in India programme is on 25 sectors. These include automobiles, aviation, chemicals, IT & BPM, Pharmaceuticals, construction, defence manufacturing, electrical machinery, food processing, textiles & garments, ports, leather, medicines, entertainment, wellness, mining, tourism and hospitality, railways, automobile components, renewable energy, bio-technology, space, thermal power, roads and highways & electronics systems. India would emerge after initiation of the programme, as the top destination globally for foreign direct investment, surpassing China as well as United States. With this initiative our Prime Minister literally inviting the rich and semi-rich countries to step in India and invest their money for the future of India. With the investment in manufacturing sector, advancement in technology, generation of the employment opportunities and the ways to make the labour skilled, our country will be touching the sky of success in just a matter of few years. A comparative figure of some sectors listed below is quite indicative about the ambitious future planning.
//Amt. in Billions of USD ($)//
| Sectors | Contribution before
Make in India |
Expected contribution after Make in India |
| Automobiles | 8.00 | 50.00 |
| Renewable Energy | 20.00 | 40.00 |
| Automobile Components | 10.81 | 39.00 |
| IT & BPM | 143.00 | 300.00 |
| Roads & Highways | 14.00 | 57.80 |
| Aviation | 17.00 | 25.00 |
| Leather | 28.00 | 76.00 |
| Space | 47.00 | 85.00 |
| Biotechnology | 1.10 | 7.00 |
Odisha
Odisha, the land of opportunity, is one of the prosperous states of India; owing to its fertile land & rich mineral resources. The state is also referred as the “Soul of India” as it is considered mystical land where the past & the future era form a harmonious blend. It is often said that the state has everything under the sky, opulent forest and agricultural wealth, mineral reserves and a divine coast line. Six major rivers that flow through Odisha make the belt more fertile with ample irrigation potential.
The State economy continues to grow between 2011-12 & 2015-16. The state strives consistently to pick up growth momentum in major economic sectors to maintain higher growth trajectory over the years. Odisha endeavors progressively to achieve sustainable and inclusive higher growth with reduction of regional disparities, faster poverty reduction, effective delivery mechanisms, infrastructure development etc. Odisha’s economy expects to grow at a growth rate of 6.16 percent in 2015-16 at constant (2011-12) prices. The services sector overtakes agriculture and industry sectors as leading contributor to state’s GSDP. During last year the real growth rate of Odisha also remained modest with 6.24 percent mainly due to negative growth rate in mining sector. The worker population ratio (WPR) of Odisha has improved over time. The state’s unemployment rate has remained marginally higher than the all India average. Women employment increased steadily in organized sectors. It is expected to employ more than 9.3 lakh and 1.7 lakh rural and urban youth respectively with inclusive skill development in next five years through the plan programmes introduced by the State Government namely SEM, OULM & newly launched CMEGP. While the cost of living of rural workers remains low, for urban industrial workers, it has remained quite high.
Odisha has emerged as the educational hub of Eastern India and has some reputed institutes like IIM, IIT, NISER, IIIT, XIMB, Institute of Life Sciences, IMMT etc. This ensures adequate availability of a large pool of technical experts. Around 1,26,000 students graduated every year from 773 technical training institutions of the state. Bhubaneswar, the capital city of Odisha is among the most business-friendly destination. It has been ranked by the World Bank as the 3rd best city in India to do business it was recently ranked as No. 1 in Smart City challenge, from among 97 cities across India.
Sectoral Performance
The Sectoral Performance reveals the magnitude & composition of GSDP of the state economy over time. The changes in the relative sectoral shares in GSDP manifest the structural changes in the economy. Typically economic activities has been grouped into three broad sectors namely agriculture, services & industry sectors besides the primary classification of primary, secondary & tertiary sectors. The broad agriculture sector includes crops; livestock, forestry, logging & fishing & aquaculture subsectors. The broad industry sector consists of mining & quarrying; manufacturing, electricity, gas and water supply and other utility services and construction subsectors. The broad services sector includes trade, repairs, hotels and restaurants; transport, storage, communication and service related broadcasting; Financial Services, Real estate ownership of dwelling and professional services; public administration and defence and other services sub-sectors. Odisha has witnessed significant structural shift over the years. The advance estimates of GSDP of Odisha for 2015-16 at current basic prices with 2011-12 base year show that broad agriculture, industry & services sectors share 17.70 percent, 27.02 percent and 45.28 percent of total GSDP of the state respectively. These sectoral shares are tentative and likely to change marginally after the final estimates of GSDP in coming year. During 2015-16, Odisha’s economy is likely to be driven by top five key economic sectors in terms of percentage share to GSDP at current prices. Those sector includes manufacturing sector, contributing 16.77 percent to GSDP, Crop sector – 10.89 percent, trade sector – 10.86 percent, Mining sector – 9.54 percent & transport sector – 8.42 percent. The bottom five sectors which have low profile are storage (0.09 percent), railways (1.15 percent), fishing (1.66 percent), traveling (2.25 percent) & communication (2.38 percent) respectively.
SECTOR WISE ANALYSIS
Railways
Railway routes pass through twenty-three districts of the State, excluding Boudh, Deogarh, Kandhamal, Kendrapara, Malkangiri, Nawarangapur and Nayagarh. The density of coverage is relatively high in some regions of the State, while central parts remain largely untouched. A large disparity across districts exists. By the end of 2014-15, the State had 2,537 km of railway lines. Overall, railway coverage is poor in the State and this is one of the factors that has hampered the pace of its industrial development. The railway route length in the State per thousand sq. km., which is the same as railway density, is about 16 km, while the national railway density is around 20 Km.
Ports of Odisha
Paradeep Port, declared as the 8th major port of India in April, 1966 by Government of India, is the only major port in Odisha and the first major port on the East Coast commissioned in independent India. It has an artificial type lagoon of 500 metres length, 160 metres width and one turning circle of 520 metres diameter. The port is equipped with 14 berths, three single point moorings and one Ro-Ro jetty for handling various cargoes. Of this, 5 berths are fully mechanized for handling of iron ore, thermal coal and POL. Two berths are captive berth has been allotted to M/s. ESSAR for handling of iron-ore pellets on captive basis and the others are multi-purpose in nature and semi mechanized. The port has 109 million tones of cargo handling capacity. The major ongoing capacity addition projects in the port are Southern oil jetty multipurpose clean cargo berth, Deep drought coal berth and Deep drought iron ore berth on BOT basis.
With 480 Kms of coast lines, Odisha has 13 potential sites for minor ports development. These minor ports are located at Gopalpur, Behuda Muhan & Palur in Ganjam district; Baliharchandi & Astaranga in Puri district; Jatadhar Muhan in Jagatsinghpur district, Inchri, Chandipur, Bahabalpur, Kirtania & Bichitrapur (Talasari) in Balasore district; Dhamra & Chudamani in Bhadrak district. Dhamara port is commercially operational while Gopalpur and Kirtania minor ports are under development with private sector support. As on December 2015 Gopalpur and Dhamara ports have handled about 11.10 lakh MT and 12.23 MT cargo respectively. Government of Odisha makes effort to develop a riverine port on Mahanadi River near Paradeep to boost coastal shipping. Odisha has declared Port Policy in 2004, Odisha Boat Rules 2004 and Maritime Board Bill, 2012 for proper development, management, registration, operation and monitoring of ports and boats with private participation.
Core Industries in Odisha
STEEL
25 percent of total iron ore reserves of India belongs to Odisha and had about 10 percent of the total steel production capacity of the country. Besides Rourkela Steel Plant (RSP) as the only PSU in Odisha, the ten major players in private sector steel plants in the State include Vedanta, Jindal, Posco, Tata, Essar, Bhusan Power and Steel, Sterlite Iron and Steel, Welspun Power & Steel, Uttam Galva Steel etc. The installed capacity of hot metal, crude metal and saleable steel in RSP increased to 4.5 MTPA, 4.2 MTPA and 4.0 MTPA respectively during 2014-15 after expansion through modernization of the Plant. The corporate, Bhusan Steel expands its steel manufacturing capacity at Dhenkanal district to 6 MTPA. It is also setting up 197 MW CPP. The investment of Bhusan Steel remains at Rs. 131.8 billion. Another mega corporate Tata Steel has set up 6 MTPA Integrated Steel Plant at Kalinga Nagar in Jajpur district at a projected cost of Rs.431.5 billion. The project has two phases, each phase having installed capacity of 3 MTPA.
The policy of value additions, mass employment generation and welfare oriented revenue collection enabled the Odisha Government to have 49 number of MoUs with different National & International steel companies for establishment of Mega Steel Plants in the State with a production target of 77.16 MT and involving investment of over 213,969 crore. Of these 49 MoUs, 32 projects and one pilot project have started partial production with an investment of Rs.120, 557 crore. These industries have provided direct employment to about 28 thousands persons and indirect employment to 60 thousands persons. The State Government have approved the policy for long term linkage of iron ore, chrome ore and other minerals to the MoUs signed steel plant companies of Odisha through OMC. The State Government collaborates with Ministry of Steel, Government of India to upgrade Biju Pattnaik National Steel Institute to Centre for Excellence and to establish Ultra Mega Steel Projects through NMDC (CPSU).
National Investment and Manufacturing Zone, Kalinganagar:
To encourage investments in the manufacturing sector, the State has envisaged this “National Investment and Manufacturing Zone” at Kalinganagar and is determined to create state of the art infrastructure and enabling industrial urbanism, catering to metal and manufacturing industry.
The project is spread over an area of 40,339 acres which already boasts of large integrated steel plants with support infrastructure. An estimated investment of over $15.21 billion is expected to be made in this zone. Availability of diverse and large mineral reserves of aluminum, chrome and other feedstock will enable the potential investors for setting up of their industries with focus on Auto-ancillaries-component manufacturing, equipment/process manufacturing, heavy fabrication, downstream steel industries etc.
The Zone shall also have exclusive areas earmarked to be developed as downstream/ancillary industrial parks, which will thrive on the available feedstock. The development of these parks and the supporting physical and social infrastructure shall be carried out on PPP basis providing significant opportunities for the developers.
ALUMINUM
India is richly endowed with bauxite resources, which is the basic raw material for aluminum production. Estimated bauxite reserves of the country (proven and probable) stand at 593 million tones. Odisha has 52 percent of bauxite reserve and produces 35 percent of total bauxite production in India. Three major players are operating in Indian Aluminum Industry i.e. National Aluminum Company Limited (NALCO), HINDALCO Industries and the Sesa Sterlite Group, with a total installed smelting capacity of about 29 million tones.
National Aluminum Company Limited (NALCO), a public sector Unit with Government of India holding 80.93% equity, was established in January, 1981, with its registered office at Bhubaneswar. The Company has its Bauxite mines situated on a plateau in Damanjodi, Koraput, in the State of Odisha. This bauxite deposit is mined by a fully mechanized system having a capacity of 6.8 MT per year. The aluminum refinery is located at Damanjodi, Odisha. The alumina produced is transported to aluminum smelter at Angul (Odisha) and to Vizag (Andhra Pradesh) port by rail with NALCO’s captive wagons. The present capacity of alumina refinery is 2.275 million tones per annum. The aluminum smelter and coal based pit head captive power plant at Angul are strategically located. NALCO has planned to set up a 0.5 MTPA Smelter and 1050 MW Power Plant in Sundargarh district in Odisha at an estimated investment of Rs.19,000 crore. It plans for establishment of approx. 14 MW Wind Power Project in mined out area of Damanjodi with an estimated investment of Rs.82 Crore. In another major green initiative, the Company has successfully commissioned 260 KW roof-top solar systems at its Corporate Office building at Bhubaneswar. The Company also plans to install about 2 MW rooftop and ground mounted solar power project at NALCO Research and Technology Centre (NRTC) campus at Bhubaneswar. Government of Odisha has made in-principle allocated 30 acres of land to NALCO in Angul Aluminum Park. NALCO has signed a MoU with Indian Rare Earth Ltd. (IREL) in July, 2014 for development of 1 LTPA titanium slag project at Chhatrapur in Odisha in Joint Venture (JV). To promote downstream and ancillary industries within the State, the Company has committed 50,000 tonnes of the hot metal to the Angul Aluminium Park, which has been established in JV mode with IDCO. Odisha leads in India with respect to aluminum production capacity and actual production, after Vedanta Aluminum Limited (VAL) commenced production. The Aluminum produced by NALCO and Sesa Sterlite, together comprised about 57% of the total aluminum production. Thus Odisha plays a lead role in the production of aluminum.
Aluminum Park
The Aluminum Park at Angul is an exclusively state of the art industrial park for ancillary and downstream industries of Alumina. Spread over an area of 223 acres, the park is strategically located at a distance of only 4 Kms. from National Highway-42. It is also first of its kind in the sub-continent with a facility for direct molten Aluminum from the smelter. About $29 million is proposed to be spent on developing state of the art infrastructure to facilitate the industries and its value added products.
MINING
Odisha is a mineral rich State and mining royalty constitutes the main source of state exchequer. Increasing Royalty rate of some ores and necessary amendment in MMDR Act in 2015 encourages Government of Odisha to formulate Odisha Mineral Exploration Policy-2015.
Odisha Mineral Exploration Policy, 2015:
The need to formulate Odisha Mineral Exploration Policy, 2015 was contemplated due to rich stock of mineral resources in Odisha, scope for increasing share of mining sector to State GDP; massive employment opportunities; necessity of judicious distribution of these mineral resources; scope for higher fiscal resources for the State etc. The objective of the Policy is to strengthen the institutional set up for the mineral exploration in the State and to upscale the mineral exploration activities in the State with an aim of upgrading the exploration level to G2 level in keeping with the UNFC norms within a reasonable time frame and eventually to G1 level so that the potential of mining sector is achieved through scientific exploitation of mineral resources. The scientific mineral exploration in the mineral bearing areas of the State are meant for augmenting the estimated mineral resources, systematic planning of mining activities and conservation of minerals. The policy strategy includes strengthening of Directorate of Geology by entering into MoUs with GSI & MECL on exploration activities.
The policy proposes to set up an Odisha Mineral Exploration Corporation with participation of the Odisha Mining Corporation to augment the mineral resource based industries of the State and to intensify the mineral exploration in the State. Both institutional and manpower capacity building will be strengthened. A master plan will be prepared for ten to fifteen years for taking up reconnaissance and prospecting operations for mineral exploration, financial support and prioritization of mineral exploration etc. in consultation with all stakeholders.
Ancillary & Downstream
In India, the metal industry has witnessed an exponential growth. As one of the largest growing economies, India is a major consumer of metals such as steel & Stainless Steel & Aluminium. India is the largest consumer of Sponge Iron in the world, second largest consumer of stainless steel and third largest consumer of finished steel. India is also the fourth largest crude steel producer and fifth largest aluminum producer in the world.
Odisha with its bountiful natural resources has always been the favorite investment destination in the metal sector. Odisha is the largest Aluminum producing State in the country with 54% of the aluminum smelting capacity. It is also the largest Stainless steel producer of the country and has 20% of the Steel making capacity of India.
With all the available resources, Odisha has huge potential for ancillary and downstream Industries in the metal sector. The Government has been pro-active and pushing the envelope to come up with an array of investment regions and Industrial Parks such as the Kalinganagar National Investment and Manufacturing Zone, Downstream Aluminium Park at Angul, Downstream Steel Park at Angul, Stainless Steel Industries Park at Kalinganagar etc. The Industrial Parks would have committed feedstock from the mother industries in the vicinity and world class infrastructure with enabling ecosystem is awaited in this field. Odisha invites investors to explore the large opportunities in the sector and reap the benefits of the investor friendly ecosystem.
Chemical & Petrochemical
Odisha’s mega Chemical & Petrochemical Complex is very much limited to Paradeep. Due to closure of the State owned Paradeep Phosphate Limited at Paradeep and Fertiliser Plant at Talcher, the state has suffered a lot. Since Odisha’s economy is based on agriculture, the importance of fertilizer plant has a special impact on the growth and development of the state. This problem is not only limited to Odisha’s Fertiliser Plant alone. Several Fertiliser Plants have stopped production in India due to inadequate gas supply from the domestic market. This resulted in India importing over 15 lakh tones of fertilizers at higher prices. But despite of that, the state has good news to be elated. Under the prevailing circumstances the fertilizer industry got a boost by the announcement of a joint venture pact signed by Coal India, GAIL, RCF and the Fertiliser Corporation of India to set up an integrated coal gasification-cum-fertiliser and ammonium nitrate complex at Talcher in Odisha by 2019.
This recent announcement by three Union Ministers (the Minister of Chemicals & Fertilizers, the Minister of State for Petroleum & Natural Gas and the Minister of State for Power, Coal and new & renewable energy) in this regard brought a new hope for the state. Press report indicates that the upstream venture costing Rs.3000 crores, is to be called GAIL Coal Gas India Limited & GAIL will hold 35% stake in the same. Fertilizer Corporation of India Limited will hold 11%, RCF & Coal India will hold 3% stake each, while the balance of 48% will be given to the technology provider & financial institutions. The name of the technology provider is yet to be announced. The upstream project is for converting coal into synthetic gas and the downstream plant proposes to manufacture urea & other fertilizers. The downstream venture to be called Talcher Chemicals & Fertilisers Limited will be headed by RCF & Coal India, each of whom will hold a 40% stake, while GAIL & FCIL will take the balance of 10% each. This plant is expected to manufacture 1.3 million tons of urea. Two coal blocks have been earmarked for this project; one has been allocated and the other is a stand by and kept as reserve. The development work to mine coal in this allocated block will start very soon.
State PCPIR
Petrochemical industry has been one of the fastest growing sectors in the country and provides large scale employment opportunity. To promote investment in petroleum, chemicals and petrochemical, the state has placed this sector in the list of priority sectors.
The Government of Odisha has initiated steps to create mega integrated Petroleum Chemicals and Petrochemicals Investment Region (PCPIR) on 284 acres in Jagatsinghpur & Kendrapara districts. This is the 4th PCPIR in the country and IOCL is the anchor tenant in this PCPIR. An SPV “Paradeep Investment Region Development Limited” has also been formed for the implementation of infrastructure in the Region.
In order to sustain the current investment level and attract future investments, high quality supporting industrial and social infrastructure is a key requirement. A large part of the investment is to come from the private sector in the Public Private Partnership (PPP) mode as one of the preferred routes. The Odisha Public Private Partnership policy was introduced in 2007 to supplement limited public resources, create a more competitive environment, help improve efficiencies & reduce costs. Planning and Coordination Department has been designated as the nodal Department and the Odisha Industrial Infrastructure Development Corporation (IDCO) as the technical secretariat for promotion of PPP Projects. The High Level Clearance Committee (HLCA) established under the Chairmanship of the Chief Minister approved all infrastructure projects of over Rs. 500 crore being undertakes in PPP mode. The state has also constituted Empowered Committee on Infrastructure (ECI) consisting of a group of Secretaries under the Chairmanship of the Chief Secretary for facilitating infrastructure development in the state under PPP. The State Government has already created a “Land Bank” to meet the land requirements of anchor industries which have huge employment potential. A time bound action plan to implement and upgrade the maintenance & infrastructure facilities broadly aligned with the challenging needs in view of the current & emerging industrial scenario in the state has been initiated.
Indian Oil Corporation Limited (IOCL) is India’s largest commercial enterprise headquarter at Delhi, with a sales turnover of Rs.4,50,756 Crore (US $73.7 billion) profits of Rs.5273 Crore for the year 2014-15. it is also the leading Indian Corporate in fortune’s prestigious, ‘Global 500’ listing of the world’s largest corporate ranked at the 119th position for the year 2015. Indian Oil’s business interests straddle the entire hydrocation value chain from refining, pipeline transportation and marketing of petroleum products to exploration and production of crude oil and gas, marketing of natural gas and petrochemical’s, besides forays into alternative energy and globalization of downstream operations. Having set up subsidiaries in Sri Lanka, Mauritius and the UAE, the corporation is simultaneously scouting for new business opportunities in the energy markets of Asia and Africa. It has also formed about 20 joint ventures with reputed business partners from India and abroad to pursue diverse business interests.
Indian Oil Corporations latest refinery in Paradeep, Odisha the first in over a decade is the nation’s largest fuel major started production of Petrol from the Rs. 34555 Crore facility with its 3.9MMTPA major spirits unit going critical. The plant is looking for VGO-HDT to be commissioned. The refinery complex is the most modern facility in the country and is also the first and the largest Greenfield facility on the East Coast. This 15 million ton refinery is also the largest on the country’s Eastern Coast and is equipped with the largest technology including IOC’s own patented ‘Ind Max’ technology for better and higher LPG output. The refinery complex spans over 2100 acres, while the proposed Rs.35,000 Crore petrochem will come up on the north bank of jetty. It also has a 17 meter deep natural draft for its oil jetty that can berth very large ships and has captive multi fuel power plant that can generate over 360 Megawatt electricity. The paradeep refinery is the symbol of Prime Minister’s brain child “Make in India”, the in-house technically innovation of Indian Oil’s R&D – the “INDMAX” technology. The sculpture is a national salute to Hon’ble Prime Minister’s initiative to take India to the next level of growth by attracting big investments in the country and giving a boost to Indian skill and trade for economic development. The INDMAX technology implementation will double LPG gas to every household in next three years. At present approximately 50 percent of LPG imported in the country. This is the most elated news for the state to be self reliant.
Micro, Small and Medium Enterprises (MSME)
MSME drives the State economy with vibrant growth through its sizable contribution to employment generation, equitable distribution of the State income and proper mobilization of private sector resources of capital and skill. Government of Odisha endeavors to create adequate space for MSME development in the State over the years through various fiscal and non-fiscal incentives under IPR 2001, IPR 2015; MSME Development Policy 2009 and related policies. Downstream industries have been categorized as “Thrust Sector”. Cluster units development approach is being adopted to promote competitiveness of potential sectors. MSME sector shows upswing trend over years both in number of units, investment and employment generation. During 2014-15 financial year, the MSME sector in Odisha has achieved a record growth with 29866 units gone into production with an investment of Rs.2267.24 crore and employment generation of 1.07 lakh persons. By the end of October, this year, 1.60 lakh MSME units were operating in Odisha with an investment of Rs.7906.25 crore and employment generation of 8.46 lakh persons. Maximum number of MSME units were gone into production in Sundargarh district (3229 nos.) followed by Cuttack(2190 nos.), Khurda (2187 nos.), Jajpur(2008) and Ganjam (1854 nos.).
Majority of young entrepreneurs in Odisha prefer to operate in repairing and services units under MSME sector, mainly due to issues and problems related to literacy, skills, opportunities, marketing, credit facility etc. The repairing and services sub-sector share 43.7 percent of units with 37.5 percent share of investment and 27 percent of employment under MSME sector in Odisha. The food and allied sectors manufacturing units share 17.8% of units, 21.7% of investment and 18 percent of employment generation in MSME sector. The glass and ceramics sub-sector employs 17% of total employment in MSMEs remains a major problem. In view of the growing importance of small and micro manufacturing enterprises for the State economy, they have been provided with different types of subsidies including fiscal subsidies which include (i) Rebate on Land (ii) Capital Investment Subsidy (iii) Interest Subsidy (iv) Power Subsidy and (v) Reimbursement of expenditure incurred for Quality Certification up to 50 percent. Odisha has good number of salt producing units in coastal districts. Ganjam, Puri and Balasore all three salt producing coastal districts, both in cooperative and private sector. There are three registered working Co-operative Societies engaged in salt production along with 39 licenses in Private Sector. Huma is one of these co-operative societies. During last year 10047MT of salt is produced, where as it was 10760MT during the previous year. Out of the total production of 10047 MT, 3557 MT (99.78 percent) produced in co-operative sector and 6490 MT by private sector. State Government have taken necessary steps for strengthening salt production in co-operative sector by providing financial assistance for development of salt land, infrastructure facilities like construction of storage, go-down, purchase of pump sets, sinking of bore-wells for getting sub-soil brine etc.
Coir industry has sound base in the State. Odisha ranked fifth at all India level as major coconut producing States and coconut cultivation is being made over an area of 51,000 ha with 2,758 lakh nuts per annum, Coir fiber production in the State is around 3,660 MT per annum. Coir industry is labour intensive and 80 percent of the workers engaged in spinning of coir yarn are rural women. During last year, 1193 coir industries have been set up with coir products valued at Rs.102.07 crore were produced by employing 11150 persons.
MSME Development Policy-2015
Odisha MSME development policy 2015 has been formulated through on elaborate consultative process involving all stake holders including Industrial Association, Financial Institutions, Express and Government departments concerned. The new IPR-2015 targets some of the fiscal incentives towards MSME’s such as, providing land at concessional rates, interest subsidy, exemption of stamp duty, VAT reimbursement, assistance for technical knowhow and marking supports and many more. The main emphasis of this new MSME policy is to make Odisha “a destination of choice” for MSME enterprises. The policy aims to attract new investments and provide support to the existing enterprises and accordingly the frame work has been divided as enabling, supporting and incentive frame work. To achieve the objectives the Government has stressed more on Single-Window facilitation cell, setting up ancillary and downstream units.
To support and accelerate the pace of development of Micro and Small enterprises sector, State Government have made an effort to develop a robust policy “Odisha Procurement Preference Policy for Micro and Small Enterprises-2015”. To provide and ensure fair, transparent, consistent and rationally equitable procurement practices of goods and services produced and provided by MSMEs enhancing their competitiveness, State Government Departments and agencies and also Central Public Sector Undertaking MOUs signed projects in the State, power generation and distribution companies. Externally aided projects shall also procure minimum 20% of their annual value of goods and services from local MSMEs.
Agriculture & Food Production
Agriculture is elemental to sustainable development & livelihood of Odisha. The depleted share of agriculture sector to GSDP of Odisha did not deter the State Government to address the sectoral challenges with high priority. The rise of net cultivated area & food grain production remain encouraging in 2014-15 leaving aside the barriers of low yield rates & uncertainties of natural shocks etc. Although livestock population fell sharply between 2007 & 2016, the per capita milk& meat consumption show rising trend with 470 TMT of fish production in 2014-15, the per capita consumption of fish increased to 11.2 Kg against WHO norm of 11Kg. Forestry sector performed well with 35 percent of area being actual forest & tree cover in 2015. Better conservation measures, rise in mangrove areas and plantation activities helped to improve forest area in the state. Major State Policies like State Agriculture Policy 2013, Sabuja Mission & stronger institutional supports put broad agriculture sector as a major driver of Odisha’s economy.
Odisha is one of India’s agricultural rich states. It is one of the largest producers of fruits, rice, pulses & major crops in the country. Odisha has 363,000 hectors of area under agriculture & horticulture, which has been increasing over the years. The state houses a large poultry industry, which is recognised as an agricultural activity. The state has also excellent potential in developing valve added products from dairy; with all the available resources. Odisha intents to be a major destination for investments in agro/ food processing sector. The state has identified agro & food processing infrastructure as a priority sector for interventions. As an initial step to encourage food processing infrastructure, the state houses 274,000 of cold storage facilities. Since the potential of food processing industry is very high, the state has formulated an exclusive food processing policy in 2013 by providing incentives to units willing to set up food processing investments in the state. This policy provides a one-time capital grant towards development of food parks.
Food Parks
To encourage investors in the sector, two mega food parks are under development. These exclusive parks are being developed at Rayagada & Khurda offer plug and play infrastructure with cold storage facilities, testing labs, skill development centers creating a complete ecosystem to the development of the industry. The state has also identified the sector as a priority sector and as part of the IPR-2015 offer special incentives to the investors. Opportunities are abound in the field of rice-processing, support infrastructure, vegetable processing & poultry sectors. The State encourages investments in this sector and provides ‘Single Point’ services to the interested investors.
Tourism
Odisha has huge potential in tourism sector with its ancient cultural heritage, a myriad of monuments and nature’s bounties like beach resorts, ecotourism, flora & fauna, biodiversity, national parks & sanctuaries. It has capability to augment employment & income generation, foreign exchange earnings & value addition to the state economy. With abundance of natural assets, Odisha tourism has undertaken programmes for ecologically sound & economically viable tourism development, integration of infrastructural support, institutional mechanism, investment etc. with developed framework of the state. Tourist revenue is equally important for the state exchequer. Although tourism in the state plays a comparatively small role in Indian Tourism scenario, still huge potential for growth is ingrained in this sector in Odisha. The state has several destinations to attract tourists from the city of temples to sanctuaries and wildlife parks. The Budhist monastic complexes at Ratnagiri, Lalitgiri & Udayagiri along with Chandaka Elephant Reserve, Nandankanan Zoo & the Chilika are some of the major natural tourist attraction points of Odisha. Over the years the number of tourists from within the state, outside the state and abroad has been increasing. Last year the number of tourists from within the state has increased three fold, while it is more than double from rest of India & abroad. The gross inflow of money to Odisha in tourism sector during last year has been assessed at Rs. 11,628.91 crore, a rise of 9.7 percent over its previous year.
The Trade, Hotels & Restaurants industry is a sub-sector of tourism and has been consistently growing in Odisha since 1950-51. This sub-sector is expected to contribute 10.82 percent share in the real GSDP of Odisha in 2015-16. Development of the hotel industry is essential for the growth & development of tourism. Over last 10 years, the number of hotels has increased to 87 percent in Odisha. Of late, high priority has been given to the development & promotion of tourism as well as hotel industry sector in the state. During 12th Five Year Plan (2012-17) the state has an ambitious plan to spend Rs.511.05 crore for this sector. In total, 344 tourist spots have been identified for their development and promotion along with 21 tourist units. The most awaited “Shamuka Beach Project” at Puri targeted towards high end tourists, is on progress.
Odisha Tourism Policy – 2013
The Odisha Tourism Policy envisages an aggressive & proactive approach to achieve the growth potential by initiating identified policy measures, strategy, fund support, professional management input & establishing required synergies through effective coordination, institutional arrangements, focused attention & improved performance of the sector. The policy stressed more on sustainable tourism & envisages developing Odisha into most preferred tourist destination. The policy announced a good package of fiscal and non-fiscal incentives for different tourism activities with focused interventions on infrastructural and social needs. In the name of “Explore Odisha” a tourist magazine covers all the endeavors of the tourism sector.
Medical Tourism
To promote Odisha as a medical tourism destination, the state needs to add 1100 specialty hospital beds by 2025 with an investment of around Rs.580 crore. Bhubaneswar, the Capital City has emerged a health care hub in eastern India with the presence of big players like Apollo Hospital, LV Prasad Eye Institute, Care Hospital, Amri Hospital & Narayan Hrudayalaya. Since many other reputed hospitals of India are planning to open their units in Odisha in near future, the prospect of this sector is quite encouraging.
Arts and Handicrafts
Having an ancient tradition of making splendid pieces of hand carved artifacts, Odia artists have long been presenting their awe inspiring master pieces to the world. There are a lot of handicrafts that have been running as the life force in the cultural land of Odisha. Some of them include Patta Chitra, Sand Art, Metal work, Silver Filigree, Stone Carving and making Puppets and Masks etc.
Patta Chitras are miniature paintings used as wall hangings with religious themes as their subject matter. Legends from the lives of Lord Krishna are mainly depicted on this specially treated cloth known as Patta. Developed over the years, this art form has helped a distinct school of painting to evolve. Having its origin in Sanskrit language, the word Patta Chitra literally means a painted piece of cloth. This ritualistic art observes a fine blend of sophisticated art and folk element in the form of rich colours. The skilled hands of the talented artisans present blood red, red ochre, lamp black, yellow, white and indigo in a unique way as they pretend to be offsetting each other.
These pattas are carried back home by pilgrims from Puri as precious mementos. Practised widely in Raghurajpur and Dandshahi villages at the outskirts of Puri, these pattas have become synonymous to the place.
Another famous handicraft of Odisha is also based at Puri. This implies carving a sand sculpture with just clean and fine grained sand mixed with water. Attractive sculptures are carved out of this sand by Odia artists. Dating back to fourteenth century A.D. the origin of this art is associated to Poet Balaram Das, the author of Dandi Ramayan. Very eye-catching and splendidly beautiful, this art form has gained immense popularity with the development of tourism.
The artists of Cuttack have also invariably contributed to enrich their tradition in the form of an art known as Gold and Silver Filigree. Owing its popularity to this art form only the silverware or Tarakashi of Odisha (Orissa) is very widely known. Thin wires drawn from beaten silver and foils are fashioned to make unique examples of artistic excellence. Forms of animals and birds, small show pieces, fine pieces of Jewellery and articles of daily use like vermillion receptacles are made by the filigree artists that are popular the world over. Artists of Odisha create miraculous masterpieces of art practicing yet other crafts too that are now not popular in India but across the globe as well.
Seafood
India is the second largest producer of seafood in the world with its 8,118 km long coastline. India is also one of the largest exporters of shrimps to the markets of Europe, Japan and US. The exports has also seen an unprecedented 45.6% growth over 2014-15. Odisha, with its long coastline of 480 Km, has setup suitable infrastructures facilities to enable seafood processing such as marine fish landing centers, processing plants, marine crafts, ice plants, cold storages and peeling sheds.
An exclusive Sea Food Park is under development to boost the opportunities in the sector. The Greenfield cluster at Deras houses state of the art common infrastructure for collective processing of seafood products. It houses exclusive common facilities for sea food processing like cold storage, pro-processing centers, block ice factory, skill development center, polythene unit, R&D center, etc. It is the only such facility on the east coast of India. With all the required infrastructure and utilities available, the park will provide the necessary base to setup a competitive seafood unit.
The Industrial Policy 2015 has identified seafood processing as a thrust sector and has made special incentives for the development of the sector. Other than IPR, the Odisha Food Processing Policy also provides for various incentive schemes for investors in this sector.
Handloom, Textiles & Sericulture
India is among the ten largest exporters of apparels in the world. India also ranks second in cotton and silk production while leading the world in Jute production. India is one of the cheapest countries in terms of cost competitiveness of the materials. Handloom occupies an important place in preserving the State’s heritage & culture. Odisha has a long history of textile industry. The handlooms of Odisha have gained worldwide acclaim and reputation for design artistic, craftsmanship and quality. Various designs have existed in Odisha such as Sambalpuri, Bomkei, Passapalli, Bichitrapuri, Sonepuri, Khandua, Saktapada, Tarabali etc. Odisha is also famous for its Ikat type of weaving.
The State Government has laid emphasis on development of the handloom sector and improvement of socio-economic conditions of weavers. Some major schemes which have been implemented for improvement of this sector are :- promotion of Handloom Industries, Integrated Handloom Development Scheme, Cluster Development Programme, Group approach, Marketing & Export Promotion Scheme. The “Indian Institute of Handloom Technology” has been setup and functioning at Baragarh. A special project “Design Reference for collection of Odisha Handloom” is under implementation with involvement to establish a sustainable market linkage with buyers of inside & outside the country.
As regards to tasar the State is known for its exquisite silk and tasar fabrics. Sericulture is an agro-based industry, providing employment to the rural people on a large scale. During the year mulberry area in the State is about 1157 acres and 25.50 MT of reeling cocoons, 3.18 MT raw silk and 0.318 MT of silk waste were produced in the State involving 1209 SC/ST farmers.
Apparel Park, Bhadrak
A State-of-the-art Apparel Park is being developed at Bhadrak over an area of 100 acres of land to accommodate around 45 apparel manufacturing industries. It is developed under the SITP (Scheme for Integrated Textile Park) and provides world class infrastructure facilities to the industry in order to support production of textiles on modern machinery. The upcoming industries inside the park will be facilitated with provisions for basic enabling infrastructure, essential utilities and appropriate common facilities. Major opportunities in the park lie in setting up of Ready Made Garments (RMG), Textile production & Technical Textile Units.
BIOTECHNOLOGY & BIO-TECH PARK, BHUBANESWAR
India is considered to be among the top 12 biotechnology destinations in the world and 3rd biggest biotechnology industry in the Asia Pacific region. The Indian biotech industry is seen to have high potential and is expected to grow at a rate of 28% driven by a range of factors such as growing demand, intensive R&D activities and strong Government support.
Odisha is being increasingly seen as a favourable investment destination as has been highlighted by RBI and World Bank reports. The State abounds in biodiversity rich areas such as Chilika lake, Bhitarkanika, Similipal hills and many more. Odisha has a robust research and education infrastructure in the biotechnology sector such as the Institute of Life Sciences, Bhubaneswar, Regional Medical Research Centre, Regional Plant Resource Centre, National Institute of Science Education and Research.
The State is developing a state-of-the-art Biotech Pharma-II over an area of 65 acres in Andharua, Bhubaneswar in PPP mode with an investment of USD 20 million. This park will house a Biotechnology Incubation Centre spread over an area of 30,000 sqft.
In a first of its kind in Odisha and one amongst 12 bio-incubators supported by Government of India, the KIIT-TBI Bio-incubator is an initiative to foster techno-entrepreneurship in the field of biotechnology. It provides holistic ecosystem for nurturing ideas into commercially feasible ventures in various areas of life sciences.
Other developments in this sector include development of two more biotech parks, one at Khurda district and another Marine Biotechnology park at Ganjam district. In addition to this, a sub-scheme “Germplasm and DNA bank” has been prepared for development of Germplasm and DNA/Gene bank in the State. The Industrial Policy Resolution 2015 accords priority sector status to the biotechnology sector and provides several unique incentives to the investing units.
IT, ITES & ESDM
IT/ITES and ESDM sector is a new industry changing the face of knowledge economy. With the growing need the IT and hardware solutions across the globe, this sector has seen phenomenal growth in the recent past.
India is one of the major contributors to the international information Technology (IT) services market. The IT industry is expected to grow by 15% in the future and India will be a major software exporter. Since its inception in 2004, the Indian Electronics & Semiconductor Association (IESA) has played an important role in facilitating the growth of electronics and semiconductor ecosystem in the country. IESA has prepared the strategic road map for development of ESDM industry in the state of Odisha in collaboration with Ernst and young (India) and with the active participation and support of Department of Information Technology, Govt. of Odisha & other agencies.
Odisha has attracted some of the largest IT companies in India. Bhubaneswar is the base of four largest IT companies in India i.e. TCS, Infosys, Wipro and Mahindra Satyam. The State has created state-of-the-art infrastructure facilities equipped with ready to use facilities and abundant power supply to ensure smooth operation of IT sector.
Odisha has developed its specific SEZs to cater the demand of this sector. Large IT infrastructure initiatives such as Info-Park, Info-valley, Infocity and IT investment regions are under development giving impetus to the IT/ITES sector. Recognizing the strong footprint of the IT sector the state has identified ESDM as a priority sector. The presence of IT ecosystem occupied with an extensive electronic manufacturing cluster shall establish Odisha as a major destination for ESDM investments. The state has an exclusive ICT policy providing incentives and creating a sound ecosystem to the startup movement. The IPR 2015 identifies IT/ITES and ESDM as a focus sector. Recognizing the importance of ESDM the government has announced a special incentive package scheme for the sector comprising of subsidy on fixed capital investment for plant & machinery, exemption from Entry Tax on acquisition of machinery and equipment, Training subsidy etc.
Information & Communication Technology (ICT) Policy-2014
ICT Policy 2014, launched by Government of Odisha in January 2014, envisages to develop IT/ITES/ESDM industries in the State for inclusive growth and creation of employment in Odisha and leverage IT/ITES in governance to transform the State to a knowledge driven welfare society for improving the quality of life of citizens. The basic objectives and deliverables of the ICT Policy are to promote investment destinations, employability, youth empowerment, accessibility and e-governance in IT/ITES industries & education in the State. The Policy aims to create world class ICT infrastructure and integrate all ICT operators. It also aims to create ‘Brand Odisha’ for IT/ITES/ESDM industries across the globe. Odisha aspires to achieve several milestones by 2020 with effective implementation of ICT Policy 2014.
Gems & Jewellary
Odisha is richly endowed with a large variety of gemstones including emerald, moonstone, cat’s eye, topaz, zircon, sapphire, ruby, aquamarine etc. But there commercial exploration is still in nascent stage. The state has so far developed 29 gemstone belts from which only 18 belts are operational which spread across several districts. Although the State Government has formulated a Gem Stone Policy in 1998 but it is unable to cater the basic need of setting up of lapidary units for cutting, polishing of gemstones & exploration and leasing of gemstone belts in Odisha.
Recently the State Government has given approval to Gitanjali Gems Limited for establishment of Gems and Jewellary Industrial Park at Ramdaspur in Cuttack district. The project envisages a total investment of Rs.685 crore in three phases. The first phase investment will be around Rs. 209 crore. The expenditure on infrastructure development has been estimated to Rs. 129.5 crore including common facility centre. The project will require 300 MW power, 100 acre of land and 300 cubic meter of water per day. The proposed components in the park includes precious & semi-precious diamond cutting, diamond polishing, designing of Gold, Silver, Platinum, diamond jewellary, manufacturing of jewellary, fashion jewellary and life style products, development of retail centers & export houses. This project envisages employment potential for around 16000 people. However, in first phase around 4000 persons will be engaged Gitanjali Gems which has submitted its proposal in Mumbai in February 2016 during “Make in India” conclave has been approved by the single window authority in May, 2016. The park will provide added thrust to export-oriented gems & jewellary sector in Eastern India.
Pharma Sector
The State Government has announced a very pragmatic MSME Industrial Policy for a conducive growth of this sector. The development of Pharmaceutical Industry is enlisted in priority sector with handful of attracting packages. The Department of Industries has declared Cuttack & Bhubaneswar as Pharma Cluster to add advantage for growth of Pharmaceutical Industry. The growth of Pharma institutions in these areas provide the much awaited technical boost to this industry. There are many pharmaceutical units in the region manufacturing both generic as well as proprietory drugs & formulations, Utkal Pharmaceutical Manufacturer’s Association (UPMA) has been recognised by the State Government as a leading sectoral association which has more than 100 members engaged in manufacturing liquids, tablets, capsules, ointments, surgical dressings, disinfectants etc.
Odisha: The Favoured Destination
Odisha has always endeavored to provide a hassle-free business environment to investors. To ensure this environment, a number of reforms have been carried out by various Departments of the State Government in the recent past. Additionally, a number of technological interventions have also been carried out by the State Government such as the integration of business related services with the e-Biz portal. Odisha is the first state in India to launch a synchronized Central Inspection Framework for all industrial establishments. To resolve any investor queries post allotment of land by IDCO, an online Automated Post Allotment Application (APAA) has been launched.
The Industries Department, Government of Odisha has developed GOI PLUS (Govt. Odisha Industrial portal for Land use and services) system to display real time information with regards to industrial land in the State.
The system provides detailed information pertaining to industrial land with regards to availability of plots and location specific attributer in terms of connectivity, rail and road linkages and other utilities. The system also provides information about the existing industries and physical, health and educational infrastructure available in the vicinity of the land. The State of Odisha is committed to simplify the processes and expedite project approvals. Odisha has embarked on a mission to leverage technology to complement the governance framework. The approvals and clearances for the establishment and operations of the industries shall be through an on-line portal with minimum human interface. The State is a pioneer in implementing the “Ease of Doing Business” framework through a robust single window clearance mechanism. In fact, Odisha is one of the first States in India to constitute a Single Window Clearance System (SWCS) through legislation. This system enables the investor to approach a single designated authority and seek all clearances and approvals to setup and operationalize an industry.
The State established Single Window Clearance mechanism in pursuance of the Orissa Industries (Facilitation) Act 2004 for providing time bound clearances and approvals. An online Combined Application Form (CAF) has been created which all departments/authorities are mandated to accept for various clearances and approvals.
The State has put in place an effective institutional mechanism for industrial promotion and investment facilitation at various levels. A three-tier single window clearance mechanism to facilitate speedy implementation of industrial projects is in place. At the helm, the High Level Clearance Authority (HLCA) chaired by the Chief Minister and State Level Single Window Clearance Authority (SLSWCA) chaired by the Chief Secretary provides the overall direction and guidance. Industrial Promotion and Investment Corporation of Odisha Limited (IPICOL) acts as the State Level Nodal Agency (SLNA) and Technical Secretariat for SLSWCA. District Level Single Window Clearance Authority (DLSWCA) is active in all the districts. The District Industries Centers (DICs) are effectively taking on the functions of District Level Nodal Agency (DLNA).
The Single Window Clearance System in the State categorizes the proposed projects into three groups based on the total investment proposed. An investor with a proposed investment of less than Rs. 50 crore (US $ 8 million) approaches the respective DIC, which acts as the nodal agency for all further approval and clearance process. The project is considered for clearance by the District Level Single Window Clearance Authority (DLSWA). For projects with investment greater than Rs. 50 crore (approx US$8 million), the nodal agency for single window clearance process is IPICOL. All the proposals with proposed investment amount of greater than Rs. 50 crore (approx US$ 8 million) are evaluated and assessed by the State Level Single Window Clearance Agency (SLSWCA). However, for projects with proposed investment of greater than Rs.1,000 crore (approx US$160 million), a special High Level Clearance Agency(HLCA), headed by the Chief Minister, has been constituted for the clearances. One of the key reforms undertaken by the State Government is to improve the investment climate by formulating the investment facilitation cell both in State Level & District Level.
Inspections ensure that the enterprise are following the requisite legal & regulatory framework and minimizing risk for the employees. Odisha has undertaken several inspection related reforms, primary one being the setting up of a Central Inspection Framework. The central Inspection framework was created to address the common complains about ambiguity, duplication and overlapping mandate between inspection authorities and perceived lack of co-operation and co-ordination. The central inspection framework created by the Government eliminates the process of multiple visits to the same enterprises and synchronizes various inspections. This framework aims to achieve the objective of simplifying business regulations and bring in transparency and accountability in inspections. The CIGG shall also be responsible for monitoring the performance of field offices and collecting regular reports at suitable intervals, and then aggregating these reports to determine benchmark achievements against plans.
e-Biz online portal has been created as a one-stop-shop for convenient and efficient online G2B services for the business community. It has been envisioned as a means to reduce the complexity in obtaining information and services related to starting businesses in India and dealing with licenses and permits across the business lifecycle. Government of Odisha has integrated 15 services from the State and made it available on the eBiz online portal to enable hassle-free processes for the investors. 9 more services will be integrated soon and all registration, application, approval and renewal related services will be available on the portal for easy access by the investors.
The State of Odisha has implemented the Automated Post Allotment Application (APAA) for smooth management of existing MSME business units associated with IDCO. This portal has been developed to facilitate online registrations, applications for any post allotment matters, online payments, application tracking and processing activities. The portal has been envisioned to reduce the steps involved in the application process. It also enables the units to download the sanctioned letters, removing all physical interfaces between them and IDCO, thus reducing the burden on both.
STRENGTH & OPPORTUNITIES
MAKE IN ODISHA
Government of Odisha has taken a policy decision to organise a biennial event named as “Make in Odisha” in collaboration with Department of Industrial Policy & Promotion (DIPP), Government of India, beginning from November 30 to December 02, 2016 at Bhubaneswar. Government of Odisha has already promoted the brand in “Make in India” through Road Shows in different industrial cities of India. In first phase the “Make in India” road show has started from Mumbai during the “Made in India” week and then spread its wings to Bengaluru, Kolkata, Hyderabad, Delhi & Pune. During the show at Bengaluru, Odisha Government had discussed with at least 66 Companies and has attracted investment of as much as 90,490 crore. In Mumbai the State Government has been assured from the potential investors for investment of around 70,000 crore. The objectives of the Road Show and the Conclave are to display the manufacturing eco-system of Odisha, to highlight investment opportunities and to acclimatize the potential investors with the investor friendly policies of the Government of Odisha. Recently during the Road Show at Bengal the state industry minister had successfully convinced 25 Industrialists to invest around 500 crore. The results of the Road Shows are very encouraging. So far over 800 companies from across the globe have evinced interest to participate in the three days conclave. The conclave aim to initiate the Industrial Development Plan: Vision 2025 – which can attract an overall investment of 2.5 lakh crore which could generate direct and indirect employment opportunities for 30 lakh people. However, the manufacturing prowess of Odisha along with its start-up-policy & investment opportunities generated in the focused sector can tell the truth in future.
Ease of Doing Business
The most positive sign of industrial growth of the state is reflected in the latest publication of “Ease of Doing Business” released by the Union Commerce & Industries Minister recently. Odisha has slipped from seventh place last year to eleventh place this year. The state has notched up to 92.73 percent overall score by registering a 40 percent jump over the figures of 2015. From an “Aspiring leader” last year, Odisha is now recognised as a “leader”. The implementation of business reforms along with Central Inspection Frame Work clubbed with e-Biz on line platform has made the state’s journey to destination. The Goiplus, a GIS based land Bank system for all industrial land in Odisha has also been appreciated in the report as it provides all required details related to existing industries in the state such as raw materials used & finished products produced. Other reforms include exemption of green category industries from Consent Management, self certification under various labour and environmental laws, issues of certifications and licenses for longer duration with provisions for auto renewal and reduced frequency of Departmental Inspections based on third party empanel audit reports helped Odisha to grab more points. But despite of this the state has recently been declared as “Not Farmer Friendly” by NITI Aayog. In this list Odisha occupies 21st position in the Agriculture Marketing and Farmers Friendly Reforms Index. In a recent survey in “India Today” along with Nielsen the best performing & most improved state status goes to Tamilnadu where Odisha figures in the rank of 17 in comparison to last year ranking of 5. Although every survey has its own limitations but the result is quite alarming in nature.
Weakness & Threats
Despite of a business Friendly Policy and a stable Government the state is lagging behind the industrial race. The million dollar question is where the fault lies. If we analyse sector wise then virtually in almost every sector, there are some problems the entrepreneurs are facing. Aggressive promotion along with a quick grievance redressal mechanism is the need of the hour. The attitude of the concerned authorities must be business oriented and we have to develop some good clusters in every field of operation. Even some clusters which have been developed over the years are not devoid of traditional old age problems of technological obsolescence, poor product quality, poor market linkages, power shortage and host of problems. Another factor which requires attention is strong technological innovation. The innovation linkage is required regionally, nationally & globally to meet the challenge. Adequate importance should be given to MSME, Tourism, Ancillary & downstream industries as these sectors have a tremendous growth potential. The factor which contributing much to negative growth is the problem of land acquisition & power tariff. Although we have a transparent land acquisition policy; but in practice we are unable to deliver it. The unit of power tariff is almost one & half times more than that of our neighboring states. Despite of the impediments & hurdles, the State Government is trying its best to address these issues. In MSME sector which is the growth engine of the economy, Odisha is way behind the target in 2016-17, particularly in backward districts. In order to strengthen the deliver mechanism the State Government is planning to announce eight new policies which can address the grievance of the entrepreneurs in Textiles, Pharma, Bio-technology, Food Processing, Power, Health, Tourism & MSME sectors taking into consideration of the shortcomings in the existing policies.
Conclusion
Business means Professionalism which can be generated from a conducive climate mixed with creativity & innovation. There was a time when Odisha relied predominantly on agriculture. Then the Nehruian era saw the growth of industry. Gradually the service sector took off. But what will define Odisha’s next leaf is its ability to innovate and come up with products relevant to the State, Country and the global market. Because businesses are moving from an era of operational uncertainties, that could be handled with internal tools to structural uncertainties arising out of external environment. This needs a new of type of leadership. Aggressive businesses are not waiting to identify the change and instead are becoming the change. New product launches, business models and innovations in marketing strategies are helping them to carve out their own niche markets. The development of cleaner technologies along with sustainable development and eco-friendly ambience is the need of the hour. Although Odisha is a land of opportunity and possibility but it has its own limitation while implementing different policies & practices. We had a very poor experience in multinational giant Posco & Arcellor Mittal case where delay in land acquisition process virtually spoiled the industrial scenario of Mega Projects having large gestation period. Lack of ability to deliver the reform process as well as the inability to form good clusters and contract enforcement exposes our short-comings. We have too many expectations but least commitments. Sustainable development is the pathway to the future we want for all. It offers a frame work to generate economic growth, achieve social justice, exercise environmental stewardship and strengthen good governance. These are the buzz word of the day which we have to take into account.
In the modern economy people can no longer expect large enterprises to guarantee them jobs for life. Individuals are increasingly expected to seek out their own opportunities, actively create values and behave ethically rather than faithfully follow rules & regulations set by others. In particular, today’s young people need to learn to be enterprising, both when working for others and when setting up their own business. Being enterprising involves taking responsibility for decision making, becoming increasingly self reliant, pioneering adventurous, daring, dynamic, progressive, ambitious and holding their own values, as well as being able to initiate ideas and see them through into action. With these strength in our back, we can provide the right direction to the budding entrepreneurs of our state to start their own business. This along with the investments from giant national & international companies can really lead the state towards growth. Bureaucratic lapses, slow decision making and poor execution have led Odisha to miss several opportunities in the past. As the state is struggling with slow economic growth & huge pool of educated unemployment, setting of industries along with focus on agriculture and other untapped sectors is perhaps the only opportunity left with us. So, this is the most opportune moment for us to implement our viable and sustainable environment friendly Industrial Policy along with development of ancillary & downstream industries for an inclusive growth of the state and to enrich the quality of life for our posterity.
