Investment Climate in Uttarakhand

Investment Climate in Uttarakhand

Contents

Economic and Demographic Profile 1 Economic Profile 1 Demographic Profile 2 Physical Infrastructure 2 Power 2 Roads 3 Railways 3 Airports 3 Telecom 3 Social Infrastructure 3 Health 3 Education 4 Industrial Profile 5 Land Availability 6 Industrial Land 6 Agricultural Land 6 Manpower Availability 7 State Policies and Incentives 7 Investments in the State 7 Looking Ahead 8 Annexure : Policies 9

• All data is at constant (2004-05) prices unless explicitly stated otherwise • GSDP stands for Gross State Domestic Product • CSO data accessed on 18 October, 2012 EXECUTIVE SUMMARY

Uttarakhand, carved out of the hill region of Uttar Pradesh in 2000, is situated in the foothills of the Himalayan mountain ranges, sharing a border with Nepal in the east and China (Tibet) in the north. The state has made rapid economic progress, emerging as one of the fastest growing states in the country. The growth has been led by manufacturing, construction and the services sector.

Uttarakhand offers diverse agro-climatic zones and great biodiversity in terms of flora and fauna, making it an attractive destination for high value-added niche agro-based industry, floriculture, and horticulture. The state also offers tremendous opportunities in tourism, owing to its pristine natural beauty and presence of many spiritual tourism destinations.

Advantage Uttarakhand:

• Well-developed industrial infrastructure, including Integrated Industrial Estates, sector parks and well-developed

industrial estates in private/joint sector

• Focus on Public Private Partnerships especially for industrial infrastructure, tourism, healthcare and education

• Huge tourism potential- pilgrim tourism, nature & eco-tourism and adventure tourism

• Abundant water resources favouring hydro-power generation with a potential of 27,000 MW power, out of which

only about 3,618 MW has been harnessed so far

• Home to leading academic & research organisations, providing a strong foundation for the setting up of

knowledge based industries in the state

• Substantial fiscal incentives, specially for projects in the hill areas

• The state is close to the National Capital Region, a hub of trade and commerce. It also has good connectivity

with the neighouring states 1

Economic & Demographic Profile

Economic profile Uttarakhand is one of the fastest growing economies in the A major share of the state’s GSDP is dependant on the services country. The GSDP of Uttarakhand was Rs 609 billion in 2011- and secondary sector, which have a share of 52.6 and 36.4 percent 12 against Rs 248 billion in 2004-05, registering a CAGR of 13.7 respectively during 2011-12. The services sector registered a CAGR percent1. of 14.7 percent, while the secondary sector grew at a CAGR of 18.7 percent during 2004-05 to 2011-12.

Figure 1: Growth of GSDP of Uttarakhand Figure 2: Key Economic Indicators

700 21 18.1 18.3 609 Key Economic Indicator (2011-12) Value 600 555 18 14.3 507 500 13.6 15 GSDP Rs 609 billion 428 380 400 12 Growth in GSDP 9.7 percent 322 12.7 9.6 9.7 283 300 9 In billion In percentIn Per capital income Rs 52,125 200 6 National Per capita income Rs 37,851 100 3

0 0 Source: CSO 06 07 08 09 10 11 12 ------2005 2006 2007 2008 2009 2010 2011 Source: CSO

1 CSO 2

The growth of the economy has been largely driven Physical Infrastructure by manufacturing, construction, transport, storage & communication, trade, hotels & restaurants, financial services Infrastructure forms the backbone of any economy. In this regard, and real estate. Manufacturing recorded the highest CAGR of 25.1 Government of Uttarakhand is taking the requisite measures for percent, which is one of the highest in the country. the development of its infrastructure.

Figure 3: Contribution of different sectors towards the economy of Uttarakhand Power 2004-05 2004-05 2011-12 The state has an installed power generation capacity of 2,557 MW, comprising of 1,423 MW under state utilities, 719 MW

23.5 11 under central utilities and 415 MW under private sector. Of the 23.5 total installed capacity in the state, the contributions from various 3 49.5 sources are : 49.5 52.6 36.4 27.0 • Hydro power – 78.1 percent 27.0 • Thermal power – 13.7 percent • Renewable energy sources – 7.3 percent • Nuclear power – 0.9 percent Primary Secondary Services Primary Secondary Services Primary Secondary Services The state is encouraging setting up of hydro projects especially Source: CSO small hydro projects in PPP and private sector.

State-owned Uttarakhand Power Corporation Limited is Demographic profile responsible for power distribution and Power Transmission Corporation of Uttarakhand Limited is responsible for The population of Uttarakhand is 10.1 million. The decadal growth transmission. Uttarakhand Jal Vidyut Nigam Limited oversees the rate for the state was 19.2 percent as compared to the national state’s hydro power generation. growth rate of 17.6 percent. The density of population of the state Figure 5: Peak demand – supply position in the state is 189 persons per sq km.2

Figure 4 : Key demographic indicators

Key Indicators (2011) Values

Population 10.1 million Population size (Males) 5.2 million Population size (Females) 4.9 million Population size (Urban) 3.1 million Population size (Rural) 7.0 million Density of population ( persons per sq km) 189 Literacy rate 79.6 percent Source: CEA Male literacy rate 88.3 percent Female literacy rate 70.7 percent Figure 6: PPP projects in pipeline in power sector Sex ratio (females per 1000 males) 963 Project Name Location Value (Rs Status million) Source: Census 2011 (Provisional) Sarju Valley Hydel Project Multiple 430 Being Implemented Eastern Ramganga Valley Multiple 745 Being Hydel Project Implemented Kosi Valley Hydel Project Multiple 930 Pipeline

Interlinking of Micro-Hydel Kapkot 742 Pipeline Projects and the Grid

Source: Uttarakhand Public Private Partnership Cell

2 Census 2011, Provisional 3 Central Electricity Authority, August 2012, including allocated shares in joint and central sector utilities 3

Roads

Roads are the prime means of transport in a state like Uttarakhand Efforts are underway to operationalise the airstrips at Naini Saini in with large parts of the state under hilly terrain. During the last Pithoragarh, Gauchar in Chamoli and Chinayalisaud in Uttarkashi. decade, not only has the road length increased substantially, the These airstrips will provide vital air connectivity to some of the quality of the roads has also improved. remotest locations of the state, giving a major boost to tourism and other developmental activities. The total length of roads in Uttarakhand is 36,614 km4. The total length of National Highways passing through the state is 2,042 km. Telecom Figure 7: Key Road Network Uttarakhand has 54.3 million subscribers and an overall Road Type Road Length (in km) teledensity of 60.96.

National Highways 2,042 Figure 9: Key Telecom Indicators State Highways 3,788 Key Indicators Value Major District Roads 3,322 Other District Roads 2,965 Subscriber base 54.3 million Rural Roads 13,282 Wireless subscribers 53.6 million

Source: Uttarakhand at a Glance, 2011- 12 Wireline subscribers 0.8 million

Figure 8: PPP projects in road sector (2012) Teledensity 60.9 Urban Teledensity 161.3 Project Name Location Value (Rs Status Rural Teledensity 31.9 million) Source: The Indian Telecom Services Performance Indicators (January March 2012); TRAI Kosi Bridge at Ramnagar Ramnagar 260 Being Implemented Subscriber data pertains to Uttar Pradesh (West) which also includes Uttarakhand Teledensity data is for UP (East) and UP (West), UP (West) includes Uttarakhand Hindon Expressway Dehradun 7,000 Pipeline Connection to Dehradun & Haridwar

Source: Uttarakhand Public Private Partnership Cell Social Infrastructure

Railways Health The total length of railway network in Uttarakhand is 345 km.5 Uttarakhand has a good network of healthcare system. Major stations include Dehradun, Haridwar, Roorkee, Kotdwar, Kashipur, Udhamsingh Nagar, Haldwani, Ramnagar and Figure 10: Key Health Infrastructure in the state Kathgodam. Institutions Number The 125 km proposed Rishikesh Karnprayag rail link is a key link for the state. It will pass through some of the most challenging hill District Level Hospitals 12 terrain traversing through Dehradun, Tehri Garhwal, Pauri Garhwal District Female Hospitals 6 and Chamoli districts, connecting Rishikesh to many pilgrimage Base Hospitals 3 spots including Devprayag, Rudraprayag and Karnprayag. The rail Primary Health Centres/Additional 257 link will provide a major boost to spiritual, nature and adventure PHCs tourism in the Garhwal region of the state. Community Health Centres (CHCs) 55 Airports State Allopathic Hospitals 322 Joint/ Women Hospitals 41 The state has 2 airports. The largest airport is the Jolly Grant Health Posts 9 Airport in Dehradun which is well connected to many cities Beds in Government Hospitals 8,193 through Delhi. The state government is also exploring connectivity to Kathmandu, Nepal. The second airport is located Source: Uttarakhand at a Glance, 2011-12 in the Kumaon region of Pantnagar. Efforts are on to expand this airport so that larger planes can also land.

4 Uttarakhand at a Glance, 2011- 12 5 Indian Railways Year Book, 2010-11 6 Teledensity data is for UP(East) and UP(West); Subscribers data pertains to UP (West) which also includes Uttarakhand; The Indian Telecom Services Performance Indicators (January-March 2012), The Telecom Regulatory Authority of India 4

In addition, a total of 548 Ayurvedic hospitals/dispensaries Uttarakhand has some of the best boarding schools in the country including Unani hospitals are functioning in the state. The state especially in and around Mussoorie, Dehradun and Nainital. also has 107 Homeopathic hospitals/dispensaries.7 Dehradun, in fact, is an important centre of education in north India. To augment its healthcare infrastructure, the state government has initiated a number of health projects with private sector There has been widespread development of higher education in participation. the state, mostly in the private sector. 1 central university, 7 state universities, 6 private universities, 4 deemed universities (apart Initiatives have been taken by the Department of Medical Health from 1 IIT, 1 NIT, 1 IIM) have been established. Moreover, there are and Family Welfare, Government of Uttarakhand to promote PPP 107 degree & post-graduate degree colleges in the state. projects for meeting the growing need for health services in the state. In the field of medical education, 2 medical colleges have been established and 3 medical colleges are in the pipeline. In addition, 21 projects are under implementation / operation or in the 5 nursing colleges are being set up. pipeline altogether constituting 31.4 percent of all PPP projects in the state. These projects are valued at Rs 1,445 million.8 Prestigious academic and research institutions in Uttarakhand Figure 11: Key Health Indicators include:

Indicators Value • Indian Institute of Management, Kashipur • Indian Institute of Technology, Roorkee Birth Rate* 19.3 • Forest Research Institute, Dehradun Death Rate* 6.3 • GB Pant Institute of Himalayan Environment and Infant Mortality Rate** 38 Development, Almora • Herbal Research and Development Institute, Gopeswar Source: Sample Registration System, December 2011 Note: * per 1000 population • GB Pant University of Agriculture and Technology, Pantnagar ** per 1000 live births

Education

The state has 15,746 junior basic schools with 42,867 teachers and 4,379 senior basic schools with 15,901 teachers.9

In terms of secondary education, the state has 2,740 high schools.10

7 Uttarakhand at a Glance, 2011- 12 8 Public Private Partnership Cell of Uttarakhand 9 Uttarakhand at a Glance, 2011- 12 10 Uttarakhand at a Glance, 2011- 12 5

Industrial Profile

State Infrastructure and Industrial Development Corporation of Uttarakhand Limited (SIIDCUL), promotes industrial development and is also responsible for creating industrial infrastructure in the state. The state has been successful in attracting long-term investments because of its key industrial and sector-specific policies. Development of the required infrastructure has also been a key strategy of the state to attract investments in various industries.

The state’s natural resources and infrastructure, aided by policy incentives, support investments in manufacturing industries such as auto & auto components, FMCG, engineering, pharmaceuticals, electronics &electrical and food processing.

The state has emerged as a key auto hub in North India with auto majors, including Tata Motors, Ashok Leyland, Hero Honda, Mahindra & Mahindra and Bajaj Auto and setting up plants in the state. In addition, they have also set up vendor parks for their key vendors.

IT/ITeS have been accorded industry status. Several initiatives have been taken such as the establishment of the Software Technology Parks of India, earth station at Dehradun to provide high-speed connectivity, constitution of IT development agency and setting up of IT park at Dehradun.

The state holds immense potential for tourism. Uttarakhand is a well-known, pilgrimage, adventure and wildlife tourist destination for both domestic and international tourists. The number of tourist arrivals in the state was 27 million (26.9 million domestic and 0.1 million foreign) in 2010-11.11 During 2011, Uttarakhand was ranked 8th in India, in terms of visits by domestic tourists12. The state is a leading destination for river rafting.

The sector is a thrust area identified by the state government. The state is the first in the country to have created a Tourism Development Board through legislation. Proposed initiatives include Yamunotri-Jankichatti and Purnagiri-Chulighat ropeways, while 16 other locations have been identified for constructing ropeways. The idea of state guest houses being run on a PPP model is also being considered. The government is also actively developing a beach camping policy to provide further fillip to this segment of the tourism industry.

Given the diversity of agro climatic zones in the state, it is an ideal destination for high value added niche agri products. The state holds immense potential for off season and exotic vegetables, floriculture and organic products. Uttarakhand Agriculture Produce (Development and Marketing) Act implemented in 2011 promotes new reforms as well as private investments in the agriculture sector. The new Act is expected to pave the way for the establishment of private mandis. The bulk purchase licences will enable the corporate houses to buy directly from the farmers.

Given the vast network of its rivers, the state has immense potential for hydro-power generation. Out of the total estimated potential of 27,000 MW, only about 3,618 MW of potential has been harnessed. The state is actively promoting hydel power projects in private sector, specially small and medium hydro-projects.

11 Uttarakhand at a Glance, 2011- 12 12 Ministry of Tourism, Government of India

6

Figure 12 : Benefits to Thrust Sector in Uttarakhand

• Assistance in establishing small & medium size agro parks & food parks Agro & Food Processing • Higher incentives under the scheme of MoFPI being included in the difficult area category industry • Presence of 4 AEZs & a biotech park

Floriculture & Horticulture • Several agro-geo-climatic zones industry • Floriculture parks planned

ICT industry • 10 year tax holiday and other attractive incentives for units that come up by 2013 • Proximity to key markets and supply centres of North India • Development of facilities for providing spiritual lessons, reiki & rejuvenating courses Tourism • Eco-tourism hotels, spa, resorts, amusement parks and ropeways • Winter sports at locations such as Auly that have the requisite terrain for the purpose • Easy availability of raw materials Forest products industry • Ample scope to develop industries based on forest and agro wastes such as lantana, pine needles, plant & vegetative fibres • Home to a variety of flora & fauna Biotechnology industry • Industry status • Plans to develop the state as centre for excellence in Biotechnology • Development of Biotechnology parks

The key sectors in the state include automobile & auto components, electrical & electronics, pharma, FMCG and agro & food processing industries.

Land Availability

Industrial Land Agricultural Land

SIIDCUL has developed and promoted industrial estates in the 1.3 million hectares i.e 23.6 percent of the total land area in the state state and provides land to the entrepreneurs. The state has also is under agriculture and allied activities encouraged industrial estates in PPPs/JVs. These estates have Figure 14: Land Use Pattern in Uttarakhand (2010) received stamp duty concessions and rationalised land use conversion and development charges.

Figure 13 : Industrial estates developed by SIIDCUL

Name of Industrial Estate Area (acres)

Integrated Industrial Estate Haridwar 2,034 Integrated Industrial Estate Pantnagar 3,339 Integrated Industrial Estate Sitarganj 1,200 IT Park Dehradun More than 60 Pharma City Dehradun (Selaqui Industrial Area) 50 Sigaddi Growth Center, Kotdwar 100

Source: SIIDCUL Source: Land Bank Records, Uttarakhand

48 private/joint/cooperative sector industrial estates/areas have been notified by the state government spread over an area of 3,263 acres. 13 The state is proposing to develop Sitarganj phase II, spread over 1,700 acres, at an estimated cost of Rs 3 billion.

13 Department of Industries, Uttarakhand 7

Manpower Availability Investments in the State To cater to the growing requirement of skilled manpower, the state has launched the Skill Development Mission aiming to skill The state received industrial investment proposals amounting about 600,000 youth over the next 5 years. A skill mapping study to Rs 679.8 billion during the period August 1991 to May 2012. is also underway. The study would form the basis of skill planning During the year 2011 the state has attracted investment intentions in the future. of Rs 68.5 billion.

Currently the state has 115 ITIs, 40 polytechnics and 13 District Figure 16 : Investment Intentions in the state institute of educational training with an intake capacity of 11,100, Proposed Share of state in Proposed 4,320 and 1,300 respectively. Numbers Northern Region Year Investment Employment Filed (Rs billion) proposed investments (Numbers) Figure 15: Vocational and Technical Education Infrastructure (percent) 2009 165 92.9 17.7 48,338 Industrial Training Institutes (ITIs) 115

Sanctioned Seats 11,100 2010 217 79.9 10.9 61,511 Polytechnics 40 2011 77 68.5 6.9 15,055 Sanctioned Seats 4,320 2012(May) 23 5.8 2.4 2,813 District Institute of Educational 13 Training Source: SIA Statistics, Department of Industrial Policy and Promotion, Ministry of Commerce Sanctioned Seats 1,300 & Industry Note: Investment in terms of Industrial Entrepreneur Memoranda (IEMs) filed, Letters of Source: Uttarakhand at a Glance, 2011-12 Intent (LOIs) issued and Direct Industrial Licenses (DILs) issued Northern Region includes the states of Delhi, Haryana, Himachal Pradesh, Jammu & Kashmir, Punjab, Rajasthan, Uttar Pradesh, Uttarakhand and UT Chandigarh State Policies and Incentives Post the creation of the state and after the announcement of In order to attract investment into the various sectors of the state the Concessional Industrial Package (2003), there has been and thus contribute to the development of the economy as a rapid industrialization in Uttarakhand. Districts of Haridwar, whole, the Government of Uttarakhand has made several policy Udhamsingh Nagar and Dehradun have emerged as the leading announcements. These policies provide a roadmap and attempt industrial destinations in north India. to boost the industrial climate and remove various road blocks Figure 17: Industrialisation in Uttarakhand which hampered the industrial expansion of the state.These Cumulative Progress upto policy documents also encompass investment incentives and schemes for the investors. 2000 2011 Number of small & medium industries 14,163 39,160 Please refer to Annexure, for various policies in place in Investment in small & medium industries (Rs 7 68 Uttarakhand. billion) Single Window Clearance Mechanism No of large scale industries 41 215 Investment in large scale industries (Rs billion) 57 270 Single Window Clearance Mechanism was constituted in the Total employment created 67,600 254,000 state’s Industrial policy 2003. It is a two tier system which also Source: Presentation on ‘Uttarakhand 12th Five Year Plan & Annual Plan 2012-13’ provides information and escort services to entrepreneurs. Foreign Direct Investment (FDI) • State Industrial & Infrastructure Development Corporation (SIIDCUL) at the state level According to the Department of Industrial Policy & Promotion, • District Industries Centres at the district level the cumulative FDI inflows from April 2000 to July 2012 amounted to US $330 million (including Uttar Pradesh). For the period April To ensure a timely clearance, time frame for various clearances 2012 to July 2012, FDI inflows amounted to US$ 13 million14. have been defined. The entrepreneur can avail of the single window facilitation through a Composite Application Form.

14 Department of Industrial Policy and Promotion, Ministry of Commerce & Industry 8

LOOKING AHEAD

Uttarakhand has emerged as one of the resources including mountains, river and leading investment destinations, owing diverse flora and fauna, make it an ideal to good infrastructure, favourable power tourist destination. The state has immense situation and investor friendly policies. potential for health tourism, given its From having a virtually insignificant salubrious climate, natural beauty and the industrial base at the time of its inception, focus on setting up of world-class health the state has attracted investments to infrastructure in PPP and private sector. the tune of Rs 300 billion. Within the Opportunities in hydro-power in the state, Haridwar, Udhamsingh Nagar and state are immense. Out of an estimated Dehradun have emerged as large industrial potential of 27,000 MW so far only about clusters. 3,618 MW has been harnessed. The state is Agriculture is an important sector of actively seeking private participation and the state’s economy. The agro- business PPP models in hydro-power. policies of the state are very supportive for Given the large presence of quality the establishment of small and medium educational and research institutions, the sized enterprises. The Industrial Policy state has potential for knowledge-based of Uttarakhand provides a wide range of industries as well. financial incentives to the entrepreneurs. In the tertiary sector, important growth areas include tourism and information technology. Its natural beauty and 9

Annexure : Policies

Industrial Policy 200315

The existing Industrial Policy was framed in the backdrop of potentialities and expectations of the newly created state of Uttarakhand. The policy focused on the sectors where Uttarakhand has inherent advantages e.g., tourism, hydro-power, floriculture, agro and food processing, handloom, khadi and village industries etc.

Key features:

• To create high quality world class infrastructure facilities in the state and enhance, in particular, connectivity to the National Capital

Region (NCR) and other leading markets.

• To provide single window facilitation in the state to expedite project clearances and provide an investor friendly climate.

• To provide and facilitate expeditious land availability for setting Industrial ventures and Infrastructure projects.

• To promote and encourage private sector participation in the development and management of infrastructure projects such as

Industrial Estates/Areas, Growth Centres, IIDCs, Special Economic and Commodity Zones and Parks, Theme Parks, Tourism

infrastructure, development of new tourist destinations, Airports/Helipads/Airstrips, Roads, generation, transmission and distribution

of power, and projects in the area of Horticulture, Floriculture, Bio-technology etc.

• To provide assured, good quality, uninterrupted and affordable power for industries.

• To simplify and rationalise labour laws and procedures in tune with the current day requirements, while ensuring that the workers get

their due share in the economic prosperity of the state.

• To promote, in particular, small scale, cottage and khadi and village industries and handicrafts silk and handloom sectors, assist

them in modernisation and technological upgradation and provide the necessary common facilities and backward and forward

linkages, including product design and marketing support so as to make them globally competitive and remunerative.

• To address problems of sickness and incipient sickness in Industry, particularly SSIs and facilitate required restructuring and

rehabilitation, etc. in coordination with the Banks and financial institutions.

• To promote industries based on local resources particularly in the areas of agriculture, horticulture, agro & food processing and

floriculture

• To promote planned and scientific exploitation of the mineral resources of thestate and maximize value addition within the state.

• To promote leading edge technologies and sunrise industries in the state in the areas of Information Technology and Bio-technology.

• To promote public/private sector involvement in generation of power and strengthening of the transmission and distribution

network.

• To promote Tourism as a focus area and develop Uttarakhand as a premier global tourism destination.

• To provide special attention for setting up industries in remote areas.

• To develop and strengthen air, road, rail and other connectivity.

• To develop Uttarakhand as a premier education and research centre by leveraging the presence of world-class Research and Technical Institutes existing in Uttarakhand.

Fiscal Incentives:

• Capital Investment Subsidy @15 percent with maximum of Rs 3 million for companies which come in production by 31st March 2013.

• Exemption from entry tax on plant & machinery for setting up Industry or undertaking substantial expansion and modernisation

• Land use conversion and development charges and regime will be rationalised

• Stamp duty concessions will be provided in respect of land in specialized commodity parks, including IT parks

15 http://www.sidcul.com/Portals/0/attachments/IP2003English.pdf 10

• Interest incentive @ 3 percent with a maximum of Rs 0.2 million per annum per unit shall be provided to New Small Scale Industries

(SSIs) and existing SSIs for modernization and substantial expansion, provided they have availed loan from state level Financial

Institutions or Banks operating in Uttarakhand and not defaulted in payment of principal or interest instalments

• For the purpose of Interest Incentive, Substantial Expansion shall mean additional investment of not less than 25 percent of the

undercoated book value of plant and machinery of an industrial unit.

• For the purpose of the Interest incentive, modernization of new existing Industrial units means additional investment to the extent of

25 percent of the un-depreciated book value of plant and machinery, made in acquisition of plant and machinery and technical know

how for such modernization

• For revival/rehabilitation of sick SSI units, interest incentive @ 3 percent with a maximum of Rs 0.2 million per annum shall be provided

on the loan taken under fully tied up revival and rehabilitation package from financial institutions, banks etc

• For entrepreneurs in remote areas the interest incentive will be granted @ 5 percent with a maximum of Rs 0.3 million per annum • The interest 100 percent exemption on Entertainment tax will be allowed for Multiplex projects in the State for a period of three years,

and for all new amusement parks and ropeways for five years

• 75 percent of the total expenditure subject to a maximum of Rs 0.2 million incurred in obtaining national/internationally approved

quality marks such as ISO series certificate etc., shall be reimbursed to the entrepreneurs provided that the reimbursement / grant

availed for this from all sources should not exceed the total expenditure on this head

• 50 percent of the expenses subject to a maximum of Rs 0.1 million incurred in installing pollution control equipments shall be

reimbursed to the entrepreneurs, provided that the total reimbursement /grant availed for this from all sources should not exceed the

total expenditure on this head

• 75 percent of the cost subject to a maximum of Rs 0.2 million shall be made available to the entrepreneurs in the shape of assistance

for registering their patents, provided that the total reimbursement/grant availed for this from all sources should not exceed the total

expenditure on this head

• For educated unemployed youth, financial loan assistance for projects upto Rs 0.2 million in case of Manufacturing/Service Industry

and projects upto Rs 0.1 million in business sector shall be available under the “Prime Minister Rozgar Yojna” with subsidy of 15

percent of the project cost subject to a maximum of Rs 15,000

Policy for Harnessing Renewable Energy Sources 200816 Key features:

• To harness the environment friendly RE resources and enhance their contribution to the socio-economic development of the state.

• To meet and supplement minimum rural energy needs through sustainable RE projects.

• To provide decentralised energy supply to agriculture, industry, commercial and household sector.

• To improve the quality of grid power through such projects, as a consequence of tail-end generation and feeding.

• To enhance the use of energy sources that assist in mitigating environmental pollution.

• To support efforts for developing, demonstrating and commercialising new and emerging technologies in the RE sector and, to this

end, help establish linkages with national and international institutions for active collaboration.

• To create conditions conducive to the involvement of private investors in RE projects.

• To create public awareness and involve users/local community along with their capacity building in establishing, operating and

managing RE projects. • To create direct and indirect employment opportunities in the state.

16 uttarakhandjalvidyut.com/re%20policy.pdf 11

Incentives:

• Sale of electricity: On the electricity generated by the RE projects, UPCL will have the first right of purchase; such purchases may be

made in whole or part as per the requirement of UPCL. The price of electricity to be purchased by the UPCL will be determined by the

UERC; the price so determined will be announced in advance and will be uniformly applicable to all producers. The GoU will provide

guarantee for the payments to be made by the UPCL for such purchases.

• Wheeling of electricity: UPCL/PTCUL will undertake to transmit through its grid the power generated and make it available to the

producer for captive use or third party sale within/outside the state for which wheeling charges uniformly applicable to all producers

would be announced in advance.

• Banking: UPCL would extend the facility of Banking to the developers at mutually agreed terms.

• For evacuating energy from the generation site, requisite network of transmission/ distribution lines would be provided by UPCL

PTCUL.

• In case of power generation from Municipal Solid Waste, if government land (belonging to Urban Local Bodies/Panchayats) is

available, the required land for setting up RE projects would be provided on nominal lease rent of one rupee per square meter per

year for a period of 33 years subject to further renewal on mutually agreed terms and conditions.

Hill Policy 201117 The policy aims to accelerate the pace of industrial development in the remote and backward hill regions of the state by providing infrastructure for the development of entrepreneurship, extending infrastructure facilities providing a fillip to market access and financial assistance to the entrepreneurs intending to set up industries. Key features: • Land resource development promotion scheme

• Special State Capital Investment Production Incentive

• Power concessions to new industrial units

• Special Component of Interest Incentive

• Repayment of Value added Tax to the manufacturing and production units on the sale of the self-produced goods

• Special State Subsidy scheme on transport

• Fiscal incentive for the establishment of mega projects

• Promoting industrial enterprises based on local resources • Marketing promotion incentive

Fiscal Incentives: • Projects with investments more than Rs 50 million will be classified as mega project

• The minimum requirement of land for setting up a private industrial estate would be 2 acres. These industrial areas would also be

provided financial assistance up to Rs 5 million. There will be no stamp duty in the sale and lease deed of the land meant for industrial

plots

• There will also be capital subsidy on fixed capital investment in building, plant and machinery at the rate of 25 percent maximum of

Rs 3 million in Group A while 20 percent with maximum of Rs 2.5 million in group B

• The Uttarakhand government is also looking for new entrepreneurs venturing in eco-tourism, adventure sports and the service

sectors, who can take advantage of the new policy

• With the aim of attracting small units, the Uttarakhand government is offering sops for a period of 10 years under the new hill

industrial policy

• The state government of Uttarakhand has also declared the hotels and ropeways, as industries in the new Hill Policy. The Government of Uttarakhand has given many relaxations to establish

17 http://www.doiuk.org/pdfs/HILL_POLICY_(ENGLISH).pdf This report has been made by KPMG in India for CII.

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The Confederation of Indian Industry (CII) works to create and sustain an environment conducive to the growth of industry in India, partnering industry and government alike through advisory and consultative processes.

CII is a non-government, not-for-profit, industry led and industry managed organisation, playing a proactive role in India’s development process. Founded over 117 years ago, it is India’s premier business association, with a direct membership of over 7100 organisations from the private as well as public sectors, including SMEs and MNCs, and an indirect membership of over 90,000 companies from around 250 national and regional sectoral associations.

CII catalyses change by working closely with government on policy issues, enhancing efficiency, competitiveness and expanding business opportunities for industry through a range of specialised services and global linkages. It also provides a platform for sectoral consensus building and networking. Major emphasis is laid on projecting a positive image of business, assisting industry to identify and execute corporate citizenship programmes. Partnerships with over 120 NGOs across the country carry forward our initiatives in integrated and inclusive development, which include health, education, livelihood, diversity management, skill development and water, to name a few.

The CII Theme for 2012-13, ‘Reviving Economic Growth: Reforms and Governance,’ accords top priority to restoring the growth trajectory of the nation, while building Global Competitiveness, Inclusivity and Sustainability. Towards this, CII advocacy will focus on structural reforms, both at the centre and in the states, and effective governance, while taking efforts and initiatives in Affirmative Action, Skill Development, and International Engagement to the next level.

With 63 offices including 10 Centres of Excellence in India, and 7 overseas offices in Australia, China, France, Singapore, South Africa, UK, and USA, as well as institutional partnerships with 223 counterpart organisations in 90 countries, CII serves as a reference point for Indian industry and the international business community.

Confederation of Indian Industry

The Mantosh Sondhi Centre 23, Institutional Area, Lodi Road, New Delhi – 110 003 (India) T: 91 11 24629994-7 • F: 91 11 24626149 E: [email protected] • W: www.cii.in

30/1 Rajpur Road, Nepal House Dehradun - 248 001 (Uttarakhand) Tel : 0135-2745119 / 2745120 Fax : 0135-2745121 [email protected]