madhya pradesh13 12 - ibef · 2016-02-22 · madhya pradesh | december 2008 sisocio-economihtic...

MADHYA PRADESHDecember 2008

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Madhya Pradesh | December 2008

State Economy and Socio Economic Profile

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M dh P d h h tMadhya Pradesh — a snapshot

• Madhya Pradesh (MP) is located in central India with an area of 308 00 Sq km and aIndia with an area of 308,00 Sq.km. and a population of 60 million.

• Madhya Pradesh was originally the largest state in India until November 1, 2000 when the state of Chhattisgarh was carved out of the same.

• The State shares borders with Rajasthan, Chhattisgarh, Gujarat, Uttar Pradesh and Maharashtra.

• The state is divided into 48 districts (272• The state is divided into 48 districts (272 tehsils and 313 community blocks).

• Forest area of the state constitutes 31 per cent of the area of the total state area and 12.44 per cent of the total forest area of pIndia.

• The state’s central location gives it the advantage of being the hub of India’s national logistics network.MP’ d i i t ti it l i Bh l d

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• MP’s administrative capital is Bhopal and its largest city is Indore.


S i i h tSocio-economic snapshot

Parameters Madhya Pradesh

Population (census 2001) Population (2001) 60.3 million

Density (2001) 196 per Sq.km.

Sex ratio (census 2001) 920/1000 males

Principal languages Hindi

Literacy rate (census 2001) 64.1 per cent

Major minerals Copper ore, lime stone, manganese ore etc.

Major industries Cement, textiles ,minerals, edible oil

Major crops Soyabean, gram, pulses like Masoor and Arhar

GSDP at current prices in 2004-05 US$ 23,983.63 million

NSDP at current prices in 2004-05 US$ 9.8 billion

Annual per capita income at current prices in 2004-05 US$ 254

Domestic airports Bhopal and Indore

S Offi i l b it f G t f I di i di i D t t f R l D l t G t f M dh P d h

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Sources: Official website of Government of India, www.india.gov.in; Department of Rural Development, Government of Madhya Pradesh


E i P filEconomic Profile

• Endowed with large mineral resources of coal diamond limestone methane etc Madhya Pradesh NSDP Growthcoal, diamond, limestone, methane etc.

• Ranked amongst the top four states of the country for industrial investments

• Gross State Domestic Product (GSDP) at current prices in 2004 2005 was US$ S

$ B

illion

Madhya Pradesh – NSDP Growth

at current prices in 2004-2005 was US$ 24 billion

• Growth rate of 5.5 per cent• The per capita GSDP of Madhya

Pradesh is US$ 369

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003

US

Source: Department of Finance, Government of Madhya Pradesh

Pradesh is US$ 369• Net State Domestic Product (NSDP) of

the state at current prices (2004-05) was US$ 9.8 billion

• Minor Forest Produce (MFP) such as Industries

Sectoral Contribution to GSDP

• Minor Forest Produce (MFP), such as Tendu leaves, sal wood, teak wood and lak are major contributors to the rural economy of the state.

Services41%

Agriculture

Industries35%

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g cu tu e24%

5

Source: Review of Madhya Pradesh Economy, CMIE, August 2004


Infrastructure status

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Ph i l i f t tPhysical infrastructure (1/3)

Road network

• Total road length in the state is 67,600 Km.• National highways of 5,200 Km. run through the State.• 18 National highways including trunk routes of Delhi-Mumbai, Delhi-Chennai, Delhi-Bangalore, Delhi-Hyderabad.

Railway newtork

• The total length of state highways is 9,885 Km.• Convenient linkages to western ports, i.e., Kandla Port and Jawaharlal Nehru Port Trust.

y

• Well-connected with the rest of India• Almost 425 trains pass through the state on a daily basis

• 175 trains pass through the state capital ‘Bhopal’ alone

Airports• Convenient air links from key Indian cities to Bhopal, Jabalpur, Gwalior, Indore and Khajuraho.

• Five operational airports, 25 airstripsI d i h h bili f h dli i i l

BHOPAL

GWALIOR

KHAJURAHO

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• Indore airport has the capability of handling international cargo

• An international airport is proposed at Bhopal

INDORE JABALPUR


Ph i l i f t t PPhysical infrastructure – Power (1/2)

Upcoming projects in MP (indicative) Thermal Power projects

• The installed electricity generation capacity of Madhya Pradesh is 6,449

MalwaTPS Purni, Dist. Khandwa

2X500 MW

Essar Group Project Mahan coal field at Sidhi-Singraulifields

1000 MW

J G Siddhi 1000 MW

p y y ,MW.

• 95.66 per cent of MP’s electricity generation capacity is based on thermal energy with the remaining from hydel Jaypee Group Siddhi 1000 MW

Sanjay Gandhi, Birsinghpur – Unit V

- 500 MW

Amarkantakextension

- 210 MW

energy, with the remaining from hydelsources.

• On a per capita basis, electricity consumption in Madhya Pradesh stands at 352 kWh per annum close to the

Jindal Group - NA

Hydel Power Projects

Marhikheda hydro project, extension

Shivpuri. 1x20 MW

at 352 kWh per annum, close to the national average of 355 kWh per annum.

Power fact file for MP

Power generation installed capacity 6,449.25 MW

Tawa HEP (M/sHindustan Electro Graphite)

Hoshangabad 13.5 MW

Coal bed methane

Power generation installed capacity 6,449.25 MW

Power generation 24834 MU

Total power available 50679 MU

Per capita power consumption 352kWH/annum

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Reliance Energy Shahdol -

8

p p pSource: www.indiastat.com


Ph i l i f t t PPhysical infrastructure – Power (2/2)

Projected Generation Capacity (MW)

200000

225000

(MW)

155000

190000

126838

120000

50000

85000

2006 2012

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2006 2012


Ph i l i f t t T lPhysical infrastructure – Telecom

Telecom fact file for Madhya PradeshNo. of cellular mobile subscribers 8,87,990

Number of Telephone exchanges 2,791

Tele density 3.9

Working DELS 23,57,660 ( Wired-12,03,458, WLL 2,66,212 and GSM 8,87,990)

OFC route length (in Kms) 27,222.7

Working internet connections 1,51,999

Working broad band connections 34,096

Source: www.mp.bsnl.co.in

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S i l i f t t Ed tiSocial infrastructure - Education

• Ranked 12th on the Human D l t I d

Educational institution NumberDevelopment Index

• Literacy levels in the state have improved from 44.2 per cent in 1991 to the current level of over 64.1 per cent

Primary schools 87,620

Higher secondary schools 8,481

Degree colleges 250• 45 engineering colleges, over 200

technical training institutes, six medical colleges and 43 management institutes

• Key national institutes in the state

Degree colleges 250

Universities 9

Polytechnic institutes 79Key national institutes in the state include:

– Indian Institutes of Management (IIM) ,Indore

– Indian Institute of Forest Management

Industrial training institutes 200

Engineering colleges 45

Medical colleges 6Indian Institute of Forest Management– Indian Institute of Hotel Management – International Institute of Professional

Studies, Indore

Source: www.indiastat.com, 2006

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S i l i f t t H lthSocial infrastructure - Health

• Network of health facilities comprises 145 h it l 343 it h lth

Health institution Number145 hospitals, 343 community health centres, 1,705 primary health centres.

• It also has 34 Ayurvedic and four homoeopathic hospitals.

District hospitals 145

Sub-centre 20,521

Primary health centre 1,705

• The number of in-patient beds in MP’shospitals is 20,839.

y

Community health centre 343

Ayurvedic hospitals 34

U i h it l 204Unani hospitals 204

Homeopathic hospitals 4

Source: Ministry of Health and Family Welfare, GoI, March 2006

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I d t i l i f t t k l tIndustrial infrastructure - key clusters (1/3)

• Through the Madhya PradeshA d ik K d Vik Ni Ltd

Gwalior AKVN

Audyogik Kendra Vikas Nigam Ltd(MPAKVNs) scheme, the stategovernment has identified severalindustrial clusters. Several industriali t h th i t bli h t i th

Malanpur, Malanpur Phase II, Banmore, Chainpura, Siddhgawan, Pratappura

Rewa Waid

Bhopal AKVN Rewa AKVN

Indore AKVN

giants have their establishments in theseareas, however 44 per cent of thedeveloped area is still untapped andopen to investment.

Pithampur, Kheda,

Rewa, Waidhan

Borgaon, Maneri, Purena

Mandideep, Pillukhedi, Mandideep Phase II

Dewas, Maksi, Megh Nagar

Jabalpur AKVN

Total developed area 7,147 Hectares

Total allotted area 3,089 Hectares

Total units established 1,360

Growth centres 19

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Indore AKVN Gwalior AKVN• Area developed: 2,492 Hectares• Allotted: 1431 Hectares• Units established: 575• Major groups: Tata, Ranbaxy, Eicher, Bridgestone,

Hindustan Motors, Kinetic, SRF, S Kumars, Gajra,

• Area developed: 2,262 Hectares• Allotted: 800 Hectares• Units established: 326• Major groups: JK, Surya Roshini, Godrej, Grasim,

Cadbury, Hotline, Crompton GreavesHindustan Motors, Kinetic, SRF, S Kumars, Gajra, Nicholas Piramal, Indorama, IPCA, Bhilwara

• Special infrastructure: SEZ, Crystal IT Park, Food Park, Apparel Park

Cadbury, Hotline, Crompton Greaves • Special infrastructure: ICD, Food Park

Bhopal AKVN• Area developed: 1,330 Hectares• Allotted: 618 Hectares• Units established: 286

JabalpurAKVN• Area developed: 790 Hectares• Allotted: 125 Hectares• Units established: 52

• Major groups:HEG, Crompton Greaves, P&G, Godrej, Lupin, IFB, Oswal, Nahar

• Special infrastructure: ICD, Food Park

• Major groups: Raymond, Hindustan Petroleum, PBM, Ayur

• Special infrastructure: Stone Park, Food Park

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Rewa AKVN• Area developed: 273 Hectares• Allotted: 115 Hectares• Units established: 121• Major groups: Birla, Jaypee• Special infrastructure: Integrated infrastructure• Special infrastructure: Integrated infrastructure

development centres (IIDC)

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State policy and Incentives

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St t l l li i

to attract NRI and foreign investment by

State level policies (1/3)

Industrial Promotion Policy 2004• The Industrial Promotion Policy would to attract NRI and foreign investment by

developing world-class infrastructure– To create a congenial environment for the

development of small, medium and large industries

• The Industrial Promotion Policy would be effective for five years from April 1, 2004.

• The new policy envisages creating an i d t f i dl d i i t ti

– To ensure balanced regional development by generating employment in the non-farm sector

– To chalk out special packages for removing

industry-friendly administration, maximising employment opportunities, tackling industrial sickness, rationalisingrates of commercial taxes and bolstering

i t t ti i ti industrial sickness– To integrate different employment-oriented

schemes in order to provide employment opportunities on a sustainable basis

private sector participation.• Objectives of the Policy

– To make state administration and industry friendly by simplifying rules and

dprocedures– To accelerate the pace of industrialisation

and make Madhya Pradesh a leading industrial stateTo maximise employment prospects

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– To maximise employment prospects

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St t l l li iState level policies (2/3)

IT policy – 2006• Improve the life of the common man by

pest resistant seeds for agriculture and horticulture crops suited to different agro-• Improve the life of the common man by

leveraging the strengths of e-Governance• Attract investment in the sector so that the

educated youth is able to contribute to the d l t f th St t

p gclimatic zones

• Improvement of the quality of livestock and poultry, especially the breeds indigenous to the state

development of the State• Create a pool of highly skilled

professionals who are at par with the best in the country

• Enhancement of the productive potential of the aquatic eco-system

• Promotion and cultivation of medicinal and aromatic plants. Also, processing value

• Transforming MP from a resource- based economy to a knowledge -based economy.

addition of their produce.• Production of cost effective drugs that help

counter diseases common in the tropical and sub-tropical regions of the country

Biotechnology policy – 2003• Conservation of the state's biodiversity

and the sustainable use of its biotic resources

• Promote environmentally safe technologies to reduce pollution, and above all-treatment of urban waste and industrial effluents

• Afforestation and especially the quick revival

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resources• Production of high-yielding, draught and

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of species which have shown a tendency to decline.


St t l l li iState level policies (3/3)

Special economic zone policy• Exemption of all state and local taxes

Tourism policy• Improvement and creation of adequate• Exemption of all state and local taxes

and levies for transactions with the SEZ and for supply from domestic tariff areas to the SEZE ti f t d t d

• Improvement and creation of adequate basic infrastructure

• Special package of incentives for tourism industry including exemption from luxury t l t d t t i t t f• Exemption from stamp duty and

registration fees• Grant of

labour, energy, environment, industrial

tax, sales tax and entertainment tax for new projects up to 10 years.

• Designation of 25 tourist circuits for commercial tax exemption for tourist

health and safety-related permits and approvals through a dedicated single window mechanism.

• Exemption from electricity duty, cess

vehicles

p y yand any other tax or levy on sale of electricity for self-generated and purchased power.

• Expeditious process for land

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Expeditious process for land acquisition to set up SEZs.

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P t li i tPower sector: policy environment(1/2)

Policy initiatives by GOI• 100 per cent FDI is allowed under the

Key GOI initiatives under the Electricity Act 2003

• 100 per cent FDI is allowed under the automatic approval route in all segments of the industry, i.e., generation (based on coal, gas, or hydro), transmission and retail distribution

• Generation other than for large hydro projects, is de-licensed

• Open access on transmission and distribution networksretail distribution.

• Under the Mega Power Policy, incentives such as capital import duty concessions, waiver of local levies to improve cost attractiveness are

• Retail competition mandates that by July 2008 all consumers above one MW are free to choose their suppliers

• For rural power development, generation to improve cost attractiveness are extended to large generation projects

• All power projects are extended a tax holiday, i.e., deduction of 100 per cent of

gand distribution is de-licensed in rural areas

• Power trading and market development are being recognised

profit of the generation, transmission or distribution company, for 10 consecutive years out of 15 years from the year of commencement.

• Strong anti-theft and malpractice provisions

• Functional unbundling of the integrated state electricity boards and setting up of St t l t i it l t i i

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State electricity regulatory commission made mandatory by states.

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P t li i tPower sector: policy environment (2/2)

State policy initiatives• Competitive bidding for awarding• Competitive bidding for awarding

projects• Incentives for mega power projects • Relaxation of 40 per cent cap for debt

exposure by Indian financial institutions• Inter institution group for speedy

financing• Encouragement to FDI in transmissionEncouragement to FDI in transmission

via Joint Venture route and Independent power Transmission Company Route

• National Electricity Policy and National Tariff Policy notifiedTariff Policy notified

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St t l l i tiState level incentives

Special incentives• Special package for mega projects on • Entry tax exemption for five years• Special package for mega projects on

project basis by apex level empowered committee headed by the Chief Minister

• Industrial investment promotion i t 50 t 75 t f

• Entry tax exemption for five years• Five years electricity duty exemption on

captive power generation• 15 per cent capital subsidy to SSI up to

$assistance – 50 to 75 per cent of commercial tax for three to 10 years.

• Concessional registration charges and stamp duty exemption for term loans

US$ 33,000 in backward areas• Infrastructure grant up to US$ 0.22

million for developing private sector industrial parks

• Interest subsidy on term loan for five years at three to five per cent.

• For thrust sector industries, 25 per cent capital subsidy would be provided limited

• Partial reimbursement for Project report, ISO certification, patent and technology purchase cost

capital subsidy would be provided limited up to a maximum of US$ 56,000

• Land on 75 per cent concessional rate for mega projects limited to US$ 4.4 million

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million.

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Business Opportunities

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Th t f th t tThrust areas of the state (1/11)

Auto and auto components • The size of the auto component industry

Textiles • A large number of cotton textile mills are• The size of the auto component industry

in the state is around US$ 306 million. • 60 per cent of the auto industry in MP is

dominated by auto component players.

• A large number of cotton textile mills are clustered around Indore, Ujjain, Burhapur etc.

• Major textile players include Bhilwara, I d R Bh k S K ’ O l• The state has developed an industrial

cluster at Pithampur which provides readily available infrastructure for companies to set up manufacturing

Indo-Rama, Bhaskar, S.Kumar’s, Oswaland Parasrampuria.

• To further support the business endeavours Government of Madhya

facilities in the state. The estate is spread over an area of 5,000 hectares.

• The Union Government of India has sanctioned an auto cluster in the

Pradesh has created specialisedinfrastructure in the form of Apparel parks.

Pithampur industrial area. • The Government of India will grant an

amount of US$ 11 million for the same.

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Cement • Total reserves of limestone is 3625.98

Tourism• The tourism sector in MP has been

id ifi d f h k ll fmillion tonnes spread across more than 15 districts.

• Seven major cement plants are operating in the state with an annual

identified as one of the key propellers of growth by the State Government.

• The domestic tourist inflow has been approximately eight million in 2005-06. Th f i t i t i l l ti loperating in the state with an annual

installed capacity of 15.97 million tonnes.

• MP State Industrial Development Corporation has forecasted that Damoh

• The foreign tourist arrival was relatively less at 0.16 million.

• The State government has sanctioned US$ 12.2 million for development of 17 tourist spots across the StateCorporation has forecasted that Damoh-

Panna area, and Bela-Pagra of Rewahave limestone deposits worth eight million tonnes and 20 million tonnesrespectively

tourist spots across the State.• The government is also making concrete

efforts to improve air connectivity, between MP and other Indian statesrespectively.

• An estimated scope of further investment to the tune of US$ 2.5 billion exists in this sector in the state.

Indian states.• The state has taken initiatives to

promote eco and adventure tourism and is also keen on promoting medical/ herbal tourism in association with private

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pparties.

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Major tourist places• Kanha is the largest wildlife sanctuary in

Domestic tourist arrivals in MPVery high increase due to Maha Kumbh Mela• Kanha is the largest wildlife sanctuary in

Asia.• Khajuraho has some of the most famous

sculptures in the world.

(once in 3 years)

• Bhimbeteka has the oldest cave paintings in the world

• Sanchi houses the oldest Buddhist stupain the world. 2002-03 2003-04 2004-05 2005-06

• Nine national parks and 25 game sanctuaries

Foreign tourists arrivals in MP (in thousands)

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Agriculture• Several AEZs (Agri Export Zones) have • MP’s share in the total national• Several AEZs (Agri Export Zones) have

been set up for facilitating export of specific products from a geographically contiguous area.Th diti th t h hi h

• MP s share in the total national production of peas is 15 per cent.

• It’s the largest producer of soyabean, gram and second largest producer of l til il d d J• The commodities that have high

potential include potato, spices (in the western parts), pulses (in the central part of the state), wheat (in the western and central regions) and oranges (south

lentil, oilseeds and Jowar.

The state’s multiple cropped area is about 24 per centwhich can be utilised for cultivation at any given time ofthe year and irrespective of the season.

and central regions) and oranges (south districts).

• Of the total gross cropped area, 59 per cent is sown in the Kharif season while

Agri Export Zones in MP for various products/ crops

the other 41 per cent is sown in the Rabi season.

• Apart from accounting for the 37 per cent of the total national

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production, Madhya Pradesh is the leading producer of garlic.

Potato, onion and garlicSeed spices, coriander and fenugreekWheat

Pulses Oranges



IT / ITeS sector• The state has set up over 24 000 Km of

• IT/ITeS sector - Exports:– IT/ ITeS exports from MP are US$ 655 millionThe state has set up over 24,000 Km. of

optical fibre backbone to cover all its 313 developmental blocks across 45 districts.

• Four Software Technology Parks (STP units) to be set up in Bhopal, Indore and

– Software exports: US$ 11 million ; IT-enabled services: US$ 644 million

IT Parks Location

Crystal IT Park (5,50,000 Sq. ft.) Indoreunits) to be set up in Bhopal, Indore and Gwalior-are in the pipeline.

• 38 IT engineering colleges provide the learning ground for future IT professionals.

• Home to country’s first Indian Institute of

y ( , , q )

Hardware and software technology Park (200 acres) Bhopal

Software Technology Park (1,00,000 Sq.ft.) Indore

IT Park (50 acres) Gwalior

Major IT Players in MP LocationHome to country s first Indian Institute of Information Technology and Management (IIITM) at Gwalior.

• Large IT players like HCL and Genpacthave shown interest in setting up the

j y

Taurus Indore SEZ

Fujitsu Bhopal

HCL (proposed) Bhopal

Genpact (proposed investment of US$ 34 million) Bhopalhave shown interest in setting up the facilities in the state.

• Genpact India has proposed to set up a 7,000-seat BPO facility on 50 acres in Bhopal, with an investment of US$ 34

IT Park

Proposed/existingprojects in MP

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Bhopal, with an investment of US$ 34 million. Hardware & Technology

ParkCrystal IT ParkSTP Indore



Forest-based industries• Madhya Pradesh has a forest area of • The average annual production of Tendu• Madhya Pradesh has a forest area of

94689.38 Sq.km. and constitutes nearly 31 per cent area of the state.

• With a share of nearly 13 per cent of th t t l f t f th t MP

• The average annual production of Tenduleaves in the state is around 2.5 million standard bags.

• MP accounts for nearly 25 per cent of all T d l d d i I dithe total forest area of the country, MP

has the largest forest covered area among all the states in India.

• Forest-based industries are key

Tendu leaves produced in India.• Sales of forest product generated

revenues of US$ 109 million in 2005-2006.

contributors to the state’s economy and also provide employment to a greater part of the population.

• From 2004 to 2005, forests and logging contributed 2.1 per cent to the state GDP.

• The total growing stock (volume of timber/wood) in MP is 50 million Cu.mt.

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t be / ood) s 50 o Cu tvalued at US$ 55.5 billion.



Forest map of MP: Classification of MP land mass

ForestForest31%

Non-forest69%

R d 65 36Reserved 65.36

Protected 32.84

Unclassified 1.70

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• The state's a major producer of coalMineral and stores• Rich and vast mineral deposits include The state s a major producer of coal,

diaspore, pyrophyllite, manganese, dolomite, glass sand and fire clay.

• Rich and vast mineral deposits include diamonds, slate, pyrophyllite, diaspore, coal, limestone, copper ore and manganese among others. Besides, the state also has favourable geological and Mineral- No. state also has favourable geological and geotectonic settings.

• Active mining of these minerals is generating revenue of more than US$ 118 65 million per annum

based industry

of units

Location

Cement 7 Rewa, Satna, Damoh,Katni, Neemuch

Shahdol Umaria Sidhi118.65 million per annum.• MP is the sole producer of diamonds in

India.• It possesses 41.36 per cent of the total

Thermal power 10Shahdol , Umaria, Sidhi,Satna, Betul, Damoh,Katni, Rewa, Ujjain

Hydrated lime 25 Katni and Satna

Slate pencil 155 Mandsaur

national reserves of copper ore.• Thickest coal seam (135m) of Asia is

found at Singrauli coalfield in Sidhidistrict.

Roofing (Manglore) tiles 8 Hoshangabad, Balaghat

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d st ct



Reserves of important minerals of MP v/s rest of India

MP’s mineral-wise revenue (2004-2005)

34.3

5

13.3

5

294.

7

1867

.53

44.3

1820

5

6267

.01

144

80%

100%

Total Minor Minerals (US $ 11.38 mn)

0 ca

rats

)

mn

tons

)

2 (m

n to

ns)

8.63

(mn

tons

)

06.1

9 (m

n to

ns)

4074

8 (m

n to

ns)

6994

1.17

(mn

tons

)

1434

(bcm

)

133

40%

60%Total Major

Minerals (US$ 151.67

mn)

1334

.35

(‘000

22.5

9 (m

712.

52

7348 40 24 16

0%

20%

ond

ore

ore

mite ore

oal

one

ane

Minerals US$ (‘000) Minerals US$ (‘000)

Coal 118656 Ocher 4

Limestone 26500 Bauxite 280

Dia

mo

Pyr

ophy

llite

& di

aspo

Cop

per o

Dol

om

Man

gane

se o C

Lim

est o

Coa

l bed

met

ha Copper ore 2044 Rock Phosphate 144

Manganese 927 Pyrophillite/diaspore 178

Diamond 929 Calcite 4

Dolomite 229 Shale Slate 2

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P

All India MP

32

Source: Directorate of Geology & Mining, MP

Laterite 89 Kaolin 7

Fire Clay 116 Other minerals 1582

Source: Directorate of Geology & Mining, MP



Power sector• Ultra Mega Project in MP Energy demand projections in MP

5627059876

6371567799

72145

• Ultra Mega Project in MP– The Central government is setting up Ultra

Mega Power Projects in five locations in the country.

– The project has been first initiated in MP

Energy demand projections in MP

4969552880The project has been first initiated in MP

and is at an advanced stage of establishment.

– Sasan in MP, a pithead location based on domestic coal availability (while other proposed plants would be imported fuel-based) is identified for setting up this project.

– Project would require an investment of about US$ 3 3 billion 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12about US$ 3.3 billion.

– The project would utilise super critical technology to ensure higher efficiency and lower CO2 emissions.

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Power sector Upcoming projects in MP (indicative)• Major private players such as

Reliance, Essar and Jaypee Group have acknowledged the potential of MP and have proposed investment plans in the

Thermal Power projects

MalwaTPS Purni, District Khandwa 2X500 MW

Essar Group Mahan coal field atp p pstate.

Essar Group Project

Mahan coal field at Sidhi-Singrauli fields 1000 MW

Jaypee Group Siddhi 1000 MW

Hydel Power projects

Marhikhedahydro project, extension

Shivpuri. 1x20 MW

Tawa HEP(M/s Hindustan Hoshangabad 13.5 MW(Electro Graphite)

g

Coal bed methane

Reliance Energy Shahdol

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K PlKey Players

• The state houses around 1,800 companies and 19 industrial growth

export a variety of products and services to both developed and developing

centres that are located near major cities. This makes good social infrastructure easily accessible to industrial units.

countries.

• There are around 171,000 small-scale units that contribute significantly to the state’s economy.

• MNCs such as Cadbury BridgestoneMNCs such as Cadbury, Bridgestone, Hindustan Lever, Coke and renowned Indian companies such as Ranbaxy, Tata, Grasim, Hindustan Motors, Eicher, Kinetic Raymonds Ruchi Soya LupinKinetic, Raymonds, Ruchi Soya, Lupin, Crompton Greaves, Godrej, and several other big groups have their presence in Madhya Pradesh.

• Apart from meeting the local

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• Apart from meeting the local requirements, these companies also

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K l IT/IT SKey players: IT/ITeS

• Set up in 1981.

• Revenues of US$ 4.18 billion in 2007-08 recording a 35 per

Infosys

• Established in 1945.

• Revenues of US$ 4.97 billion i 200 08 di 36

Wipro

• Set up in 1997.• Formerly known as GE

Capital International

Genpact

• Set up in 1997.• Accenture India, the wholly-

owned subsidiary of the

Accenture

in 2007-08 recording a 35 per cent growth over revenues of US$ 3.12 billion in 2006-2007.

• Areas of IT consulting, modular global sourcing, process re-engineering, and BPO

in 2007-08 recording a 36 per cent growth over revenues of US$ 3.56 billion in 2006-2007.

• Areas of IT services, product engineering technology

Capital International Services.

• The company has recorded a turnover US$ 600 million during 2006.

• Provides a wide range of business process,

owned subsidiary of the $16.65-billion global management consulting and outsourcing firm.

• Total 35,000 employees ; 10,000 in the BPO (business g g,

services.

• Has operations in Australia, China and US.

• Marketing and technological alliances with FileNet IBM Intel Microsoft

engineering, technology infrastructure services, BPO and other consulting solutions.

• Provides services such as application d l t d l t &

p ,technology and knowledge services, including Finance & Accounting, Collections & Customer Relations, Insurance, Procurement & Supply Chain, Analytics, S ft IT I f t t

process outsourcing) space and the remaining 25,000 people in the business consulting and systems integration and technology di i i t l b lFileNet, IBM, Intel, Microsoft,

Orcale etc.

• Capacity of over 60,000 seats and is in the process of adding another 30,000 seats.

• Has operations at multiple locations in Bangalore and

development, deployment & maintenance, business intelligence, CRM.

• Based out of Bangalore, the company has 54 development centres and 30

ffi d

Software, IT-Infrastructure. • Presently the company

employs about 20,000 professional .Bangalore centre has about 1500 employees.

divisions to serve global clients.

• Bangalore operations has three centres with around 8,000 employees.

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locations in Bangalore and Mysore in Karnataka.

offices spread across India, N. America, Middle East and Europe.


K lKey players

• ACC is one of the largest cement manufacturing companies in India, with a

ACC Ltd.

• Cadbury India is a subsidiary of Cadbury Schweppes, the world’s

Cadbury India Ltd.

• Coca-Cola India, one of the largest companies in the beverage market, has

Coca Cola India

• One of India’s leading pharmaceutical and healthcare companies.

Nicholas Piramal India Ltd.

pcement production capacity of 16 million tonnes per annum.

• ACC is a pioneer in cement and RMC

The company has a

pp ,largest confectionery and third-largest soft drinks company.

• Cadbury India had sales of over US$ 150 million in 2003

beverage market, has invested more than US$ one billion in India over the past decade.

• In Madhya Pradesh, Coca-Cola has a plant at Pilukhedi in Raisen

p• NPIL ranks fourth in

domestic formulations sales and second in total domestic pharmaceuticals sales.

• Its Pithampur plant in • The company has a

countrywide distribution network and manufactures all types of cement.

• In Madhya Pradesh, ACC has a 1.7 MTPA cement

l t t K d l t

2003.

• The company employs nearly 2000 people across India

• Cadbury India has one of its main production plants

Pilukhedi in Raisendistrict, near Bhopal.

• The company plans to invest US$ 6.7 million for expanding the operations of its plant at Pilukhedi.

p pMadhya Pradesh is accredited by reputed organisations such as Allergan, Novartis, Solvay and VAX..

• Besides strengthening its plant at Kymore and plans to invest US$ 3.3 million to expand its manufacturing capacity of roofing products.

• This will increase its production from 68,000 t f b t fi t

its main production plants at Malanpur, near Gwalior.

manufacturing facilities, it also plans to invest US$ 45 million to enhance its R&D activities.

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tonnes of asbestos roofing to 78,000 tonnes.


K lKey players

• Procter & Gamble, India is one of the country’s most established and fastest

Procter & Gamble

• Eicher Motors, part of the US$ 355 million Eicher Group, is a major player in the Indian automobile industry

Eicher Motors Ltd

• Birla Corporation Ltd. is the flagship company of MP Birla Group

Birla Corporation Ltd.

established and fastest growing FMCG companies.

• The company has a turnover of over US$ 200 million.

automobile industry.

• Manufactures and markets commercial vehicles with Gross Vehicle Weight (GVW) ranging between five to 25 tonnes.

• One of the leading manufacturers of

MP Birla Group.• The company’s main

areas of business include jute, cement, synthetic yarn, calcium carbide, industrial gases PVC coated

• The company has a hi-tech detergent manufacturing plant in the Raisen district of the state.

gcommercial vehicles in India

• Manufacturing facility is at Pithampur, Madhya Pradesh. This state-of-the-art plant has a total area of 72 acres with 18,000 Sq. mt as the covered area

gases, PVC coated fabrics, PVC floor coverings, auto trims, healthcare and education.

• Birla Corporation has joint t d mt. as the covered area.

• The plant houses top-of-the-line equipment, a robust infrastructure and has an annual production capacity of 30,000 vehicles.

• Recently invested US$ 22 million for the

ventures and collaborations with world leaders such as DLW AG of Germany, Rhone Poulenc of France, Sweden-based

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manufacture of heavy commercial vehicles at its Pithampur plant.

Ericsson Cables & AB and ABB, GE,Toshibaand AEI Cables.

38


Doing Business

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K l i dKey approvals required

List of approvals and clearances required Departments to be consultedPrior to setting up the unito to sett g up t e u t

Registration District trade and industries centre

Allotment of land/shed District trade and industries centre

Permission for land use District authorities

No objection certificate under water and air Act Madhya Pradesh pollution board

Approval for construction activity and building plan Development authority

No objection certificate Fire department

P i i l t d t i t ti C t l d t t i d t tProvisional trade tax registrations Central and state excise departments

Registration under central sales tax Act 1956 Central and state excise departments

Before commencement of production

No objection certificate under of water and air Act Madhya Pradesh pollution l boardNo objection certificate under of water and air Act Madhya Pradesh pollution l board

No objection certificate Fire department

Permanent trade tax registration under Central and state excise departments

Registration under central sales tax Act 1956 Central and state excise departments

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After commencement of production/activity

Registration Industries department

40


A t f d i b i i th t tAverage cost of doing business in the state

Sector Cost*

1. Manufacturing

A. Land price (US$/Sq. mt.) 4.8 - 28.7

2. Electricity (US cents) 0.086 - 0.124

3. Office space rent (US$/Sq. mt./month) 0.48 - 0.96

4. Residential rent (US$/three bedroom flat/month) 268 - 335

5. Five-star hotel room (US$/night) 76.6 - 95.7

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O ll b i li tOverall business climate

Overall business climate – Madhya Pradesh• 31 per cent of the state is under forest cover with a largely unexploited species of rare, valuable medicinal-herbal

plants

• Over 2,000 Km. of roads being developed with Private Partnership (BOT)

• India’s first operational Greenfield SEZ at Indore.p

• Offers diverse tourists destinations catering to various segments of tourism such as religious (Bhojpur), eco/adventure (Panchmari), heritage (Sanchi, Khajuraho) tourism etc.

• Third-largest producer of cement in India

• Various blocks available for power, cement, iron and steel units

• Over 18,000 technical graduates and 230,000 graduates add to workforce each year.

• 12 blocks with reserves totaling 2,585 million tonnes of coal has been identified

• Over 144 BCM of coal bed methane reserves available

• Largest producer of pulses and oilseeds in the country (75 per cent of soyabean production)

• Favourable climatic conditions for cotton and over 40,000 power-looms driving the textile industry

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• Over 100 agricultural farms with an area of over 20,000 acres is available on lease to investors

42


Overall State Competitiveness

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Ad t M dh P d hAdvantage Madhya Pradesh (1/2)

Destination – Madhya Pradesh

Delhi(740 Km.)

(MPV - 789.5)

Fastest mover in

Fastest mover in infrastructure development.

Ranks second in terms of

Ranks third in terms of law and order.

Mumbai

Ahmedabad(570 Km.)

(MPV - 220.63)

Kolkata(1350 Km.)

Being centrally located,the state is easilyaccessible for all the key

Fastest mover in overall performance among the

large states in the country.

agriculture. governance.

Mumbai(780 Km.)

(MPV -1000)Pune

(800 Km.)(MPV - 206.51)

Bangalore(1400 Km.)

Chennai(1430 Km.)

Hyderabad(840 Km.)

(MPV - 257.9)

( )(MPV - 613.19)

Key markets(Distance from Bhopal)

accessible for all the keyconsumer markets in thecountry.

g y

Cost of skilled labour is US$ 2.4/day vis-à-vis US$ 3 5 to 4 0/day in metros

Source: (Reference: RK Swamy)( )

(MPV - 254.52)(1430 Km.)

(MPV -362.84) MPV – Market Potential Value

3.5 to 4.0/day in metros.

* Fastest mover is the state where the rate of improvementbetween 2003 & 2006 was greater than that between 1991 &2003

- Distances rounded off

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**Source: India Today (September ‘06 Issue)


Ad t M dh P d hAdvantage Madhya Pradesh (2/2)

Savings in office space rates (A comparison of rates in central business districts)

Savings in Land cost(Estimated value for multi product SEZs)(A comparison of rates in central business districts) (Estimated value for multi-product SEZs)

150Mumbai

DelhiAhmedabad 80

100

Vishakapatnam

0

50

100

BangaloreBhopal

0

20

40

60ChennaiIndore

ChennaiIndore Greater NoidaJaipur

PuneHyderabadChandigarh

Bhopal and Indore have substantial cost advantages when compared with other tier III and

The cost of land is one of the lowest in the country Even central hubs such as Indore and

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advantages, when compared with other tier III and IV cities.

country. Even central hubs such as Indore and Bhopal fare well against other cities in terms of low land cost.


O ll t t titiOverall state competitiveness (1/2)

Parameter Madhya Pradesh

Opportunities in type of industry

Tourism High

IT-based industries Medium

Food processing industry HighFood processing industry High

Pharmaceuticals and bio-tech Low

Agro-based industry High

Mineral-based industry HighMineral based industry g

Engineering industry Medium

Chemicals industry Medium

Handloom and handicrafts sector Low

Industrial infrastructure – existing and proposed

Power High

Transportation High

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Industrial estates/areas High

STP/IT parks Medium

46


O ll t t titiOverall state competitiveness (2/2)

Parameter Madhya PradeshPolicy incentives

Setting up and carrying out business High

Industrial infrastructure – existing and proposed

EPZ HighEPZ High

IIDC High

Industrial growth centre High

Food processing park HighFood processing park g

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Di l iDisclaimer

This presentation has been prepared jointly bythe India Brand Equity Foundation (“IBEF”) and

Author’s and IBEF’s knowledge and belief,the content is not to be construed in anythe India Brand Equity Foundation ( IBEF ) and

ICRA Management Consulting Services Limited,IMaCS (“Authors”).

All rights reserved. All copyright in thispresentation and related works is owned by IBEF

the content is not to be construed in anymanner whatsoever as a substitute forprofessional advice.

The Author and IBEF neither recommend orendorse any specific products or servicesand the Authors. The same may not be

reproduced, wholly or in part in any material form(including photocopying or storing it in anymedium by electronic means and whether or nottransiently or incidentally to some other use ofthi t ti ) difi d i

endorse any specific products or servicesthat may have been mentioned in thispresentation and nor do they assume anyliability or responsibility for the outcome ofdecisions taken as a result of any relianceplaced in this presentationthis presentation), modified or in any manner

communicated to any third party except with thewritten approval of IBEF.

This presentation is for information purposesonly While due care has been taken during the

placed in this presentation.

Neither the Author nor IBEF shall be liable forany direct or indirect damages that may arisedue to any act or omission on the part of theuser due to any reliance placed or guidanceonly. While due care has been taken during the

compilation of this presentation to ensure thatthe information is accurate to the best of the

user due to any reliance placed or guidancetaken from any portion of this presentation.

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