Confederation of Indian Industry Invest North 2013
A CII-KPMG study
Compendium of Investment Opportunities in Northern States
August 2013 Economic indicators
■ The economic growth in the northern region has outperformed the growth in rest of the country ■ GDP composition is very much reflective of the GDP composition of the entire country with services sector accounting for 57 percent in FY12
GDP growth rate (percent)* GDP composition (percent in FY12)** Strong economic growth, surpassing the national Dominant services sector with high growth rate of 9.5 growth in recent years , FY08-FY12 (CAGR - Northern percent in FY12 region: 8.1 percent; India: 7.7 percent)
10.0 9.3 9.2 9.3 8.4 8.6 8.2 8.0 17.2 8.0 6.9 6.7 6.2 Agriculture 6.0
4.0 Industry 57.0 25.8 2.0 Services
0.0 FY08 FY09 FY10 FY11 FY12
Northern region All-India
*GDP data at constant FY05 prices (data as of August 2013) latest available **GDP composition at constant FY05 prices (data as of February 2013) latest available for GDP break-up Source: MOSPI
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 1 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Economic indicators (cont.)
■ The northern region has witnessed significant FDI since FY09, though there have been occasional dips due to global factors ■ Five out of nine states/UTs in the region have a greater per capita income than that of the entire country
FDI (INR billion) Per capita income (INR’ 000) FDI in northern region recorded a CAGR of almost 18 Delhi and Haryana lead the pack percent during FY09-FY13
476 500 1,50,000 450 1,20,000 400 388 90,000 350 60,000 300 30,000 250 0 200 186 150 148 100 96 50 State India 0 FY09 FY10 FY11 FY12 FY13 Note: Rajasthan and Chandigarh figures have not been included as they are not available Sources: Ministry of Commerce and Industry; MOSPI
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 2 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Business indicators
■ High consumption makes the region an attractive market for companies ■ Business indicators show a positive trend across segments, producers, consumers and financiers
Consumption spending (INR) Bank deposit and credit off-take (INR trillion) Six of the eight states have higher monthly per capita Rising credit off-take indicates increased financial consumption expenditure (MPCE) than all India average intermediation
2,500 2,362 1,916 25 2,095 1,746 1,879 2,000 19.1 1,552 20 1,500 1,237 1,421 17.0 15.0 1,000 15 12.8 13.9 500 11.3 12.1 10.5 0 10 7.9 6.9 UP J&K
Delhi 5 Punjab Haryana
Rajasthan 0
Uttarakhand Dec'08 Dec'09 Dec'10 Dec'11 Dec'12
Credit Deposit
Average MPCE (INR) All India average MPCE (INR) Pradesh Himachal
Sources: National Statistical Organisation; RBI
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 3 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Infrastructure indicators
■ Power capacity and road network has been continually growing, which will support economic growth
Power sector (billion units) Road sector (Km) Uptrend in power generation, which recorded a CAGR Road length in northern region recorded a CAGR of 6.5 of 6.9 percent during FY08-FY13 percent, more than twice the growth rate recorded by All-India of 3.0 percent 300 273.2 258.4 40,00,000 37,90,342 35,71,510 36,82,439 250 224.7 237.9 201.9 200 196.1 30,00,000
150 20,00,000 100 9,13,648 10,00,000 8,05,887 8,69,984 50
0 0 FY09 FY10 FY11 FY08 FY09 FY10 FY11 FY12 FY13 Northern region All India Generation (BU)
Note: Data for road network is latest available Sources: Central Electricity Authority; Ministry of Road Transport and Highways © 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 4 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Demographic and social indicators
■ Vast population base across income groups presents business opportunities across a broad spectrum ■ States/UTs in the region have made significant progress in improving the standard of living for people
Rising urban population Birth rate (percent) About 42 percent of northern region population lives Except two states, UP and Rajasthan, all other states in urban areas compared to all-India average of 31 have a birth rate lower than All-India’s average of 21.8 percent percent 120 30 27.8 100 10.0 26.2 22.3 24.9 25 17.5 15.0 18.9 16.5 16.2 17.8 80 27.2 30.6 34.8 37.5 21.8 20 60 97.5 97.3 15 40 77.7 90.0 10 72.3 69.5 65.2 62.5 75.1 20 5 2.5 2.8 0 0 UP J&K UP Delhi J&K Delhi Punjab Punjab Haryana Himachal Haryana Pradesh Rajasthan Himachal Rajasthan Chandigarh Uttarakhand Chandigarh Uttarakhand
Rural population (%) Urban poulation (%) Birth rate All India birth rate
Sources: Planning Commission; SRS Bulletin
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 5 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Advantage north: ahead of the curve
Higher education for High economic growth improved employment rate (Northern region (IIT Roorkee, IIM Rohtak, recording a higher University of Petroleum & growth than all-India Energy Studies etc.) average in recent years)
Abundant natural Strong consumer base resources
(Growing urban North India’s advantage galore (crops, fruits, water, population and higher ranges from all counts: minerals etc.) per capita consumer spending ) Production Consumption Trade Government support Policy and fiscal Demography etc. Fast growing services incentives sector
(State specific industrial (Services sector in northern region recorded growth of and other policies Well-developed providing tax exemptions 9.5 percent in FY12) etc.) Developing world class tourism infrastructure (UP, Rajasthan, Uttarakhand and J&K account for over 24 (Delhi’s IGI airport, percent of domestic tourist DMIC, Metro rail, Global visits. J&K, Delhi, UP, corridor along Kundli- Rajasthan and Himachal Manesar-Palwal account for over 30 percent of expressway etc.) foreign tourist visits)
Sources: MOSPI; Press articles
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 6 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Delhi: a snapshot
Delhi is the national capital of India, popularly known for its heritage sites. The state is among the pioneers for introducing privatization in power distribution and has emerged as one of the leading cities in well-developed infrastructure. Though its economy is mainly driven by the service sector, the UT also houses several industries, with more than 100,000 manufacturing units.
Sources: MOSPI; DSIIDC; Press articles; Find Data website, www.findthedata.in , accessed on 12 August 2013
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 7 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Delhi: a snapshot
Overview
GSDP (INR billion) and growth rate (percent)* Geographic and demographic indicators 14 12.9 2,210 2,500 ■ Geographical area (sq km): 1,483 12 2,027 1,856 2,000 1,698 9.3 9.2 ■ 10 1,558 Total population, 2011 census (million): 16.8 9.0 9.0 8 1,500 ■ Population density, 2011 census (persons per sq km): 11,297 6 1,000 ■ Literacy rate, 2011 census (percent): 86.3 4 500 2 0 0 FY09 FY10 FY11 FY12 FY13 Economic indicators GSDP composition (percent)** 120 ■ GSDP*: State GDP recorded a CAGR of 9.9 percent during FY08-FY13 100 80 60 ■ Sector-wise CAGR**: Agriculture (9.2 percent), Industry (8.1 80.5 85.2 percent), Services (12.2 percent) 40 20 18.4 14.1 0 1.1 0.7 ■ Per capita income, FY13*: INR120,414 (USD2,213.5) FY05 FY12
Agriculture Industry Services
Note: 1 USD = INR 54.4 for FY13 *At constant FY05 prices (data as of August 2013) **At constant FY05 prices (data as of February 2013) Source: MOSPI
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 8 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. State’s sector specific strengths
Priority sectors Knowledge based industries
■ Large skill base and good infrastructure make it ideal place for knowledge based industries
■ Government’s emphasis on skill development (via proposed Delhi Skill Development Mission and Delhi Knowledge Development Foundation) to assist existing units to upgrade to high-technology and cater to knowledge based industries
■ Emphasis on setting up of ‘Centre of Excellence’ to promote innovation and entrepreneurship in high technology and knowledge based sectors Real Estate and Construction
■ Accounts for 19 percent of state’s GDP
■ Delhi offers a profitable investment owing to its well-developed infrastructure, growing economy and population
■ Key players: DLF, Unitech, Ansal API and Parsvnath
Banking and Insurance
■ Accounts for 26 percent share in state’s GDP
■ Home to most of the financial institutions offering a gamut of financial services
■ Key players: Life Insurance Corporation of India, State Bank of India, ICICI Bank, Kotak Mahindra among many others
Sources: Government of Delhi; Press articles
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 9 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Sector-wise opportunities ‒‒‒ Knowledge based industries
Key enablers
■ Knowledge based industries (KBI) refers to IT/ITeS, Education, Media, Biotechnology, R&D and Financial Services sectors
■ Delhi has the potential to transform into a knowledge-based economy supported by well- developed infrastructure, l arge skill base and increased penetration of telecom network
■ New Industrial Policy (2010-2021) proposes to develop an Electronic/Light Engineering Park/SEZ to promote hardware and IT sector together
■ Some other policy proposals for cluster development include:
‒ Electronics and Light Engineering Park/SEZ
‒ Fashion Technology and Design Park
‒ Education and R&D hub
■ IT Park/SEZ in Shastri Park was set up by Delhi Metro Rail Corporation
‒ First block provides employment to 3,000 people
‒ The second block has been recently completed
■ An IT park is being developed in the National Capital Region (Noida), which will also have a World Trade Centre to promote international trade and commerce
Sources: Government of Delhi; Press articles; DMRC; DSIIDC
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 10 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Sector-wise opportunities ‒‒‒ Knowledge based industries (cont.)
Sector opportunities
■ State government’s strong emphasis on the development of this sector: ‒ Government’s emphasis on skill development (via proposed Delhi Skill Development Mission and Delhi Knowledge Development Foundation) to aid existing units to graduate to high-technology and knowledge-based industries offers opportunities for investors
‒ Emphasis on setting up of ‘Centre of Excellence’ to promote innovation and entrepreneurship in high technology and knowledge based sectors
‒ Investment required in the areas of data processing and filtering
Sources: Government of Delhi; Press articles; DSIIDC; Company website
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 11 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Sector-wise opportunities ‒‒‒ Pharmaceutical and Healthcare
Key enablers
■ Increased healthcare accessibility, positive regulatory intervention and improving infrastructure provides pharma companies with adequate access to clinical subjects, data on efficacy, safety of prospective drug and compositions, which in turn, aids in clinical research and formulation development
■ Supportive government policies, accompanied with quick project approvals and fiscal incentives in the form of exemptions from excise duty and income tax and grant of capital investment subsidy to new establishments
■ Increasing awareness of healthcare among the masses also supports growth of pharmaceutical sector Sector opportunities
■ Diverse investment opportunities:
R&D oriented facilities Drug manufacturing facilities Packaging/labeling Transportation of drugs Oncology, neuro, respiratory, dermatology centers
Sources: Government of Delhi; First Pharmaceutical Census of India, FY11; Press articles
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 12 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Project-wise opportunities
Major Greenfield Industrial Infrastructure Projects in Delhi
Multi-level Manufacturing Hub, Mundka-Ranikhera ■ Situated approximately 10 km away, MLM in Mundka-Ranikhera can emerge as ■ Electronics component manufacturing complimentary development to KBI Baprola depending on the industry mix ■ Systems design and testing ■ IT hardware manufacturing ■ Semi-conductor manufacturing ■ Gems and Jewellery manufacturing ■ Apparel testing and design ■ Bio-Technology Knowledge Based Industries Park, Baprola
■ Information Technology ■ IT enabled Services ■ Both the projects — Multi-level manufacturing hub at Mundka – Ranikhera and the Knowledge Based Industries Park at Baprola — ■ Gems and Jewellery Design are expected to complete by 2016 ■ Media ■ The Delhi Government expects to attract an investment of ■ Business Services approximately INR700 billion and generate employment opportunities for nearly 300,000 people through these two projects Sources: Government of Delhi, DSIIDC website, Press articles
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Multi-Level Manufacturing Hub at Mundka - Ranikhera
■ Under the industrial policy for Delhi 2010-21, Delhi State Industrial and Infrastructure Development Corporation Ltd. (DSIIDC) announced its plans to build a Multi-Level Manufacturing Hub at Mundka – Ranikhera to provide developed built, organized and ready to use work spaces and employment for skilled work force in Light and Services based industries in Delhi
■ The DSIIDC had acquired a land measuring 147 acres at Rani Khera on Rohtak road in Delhi – The area has been classified as 610,000 sq meter under the built-up structure, 150,000 sq meter under the area under basement and 190,000 sq meter under the multi-storey parking
– The proposed site is located at an approximate distance of 1.5 Km from NH-10 (Delhi Rohtak road) which is adjacent to the main railway line to Rohtak
– In addition to the metro station of Mundka, the connectivity to the main-line city is through the outer ring road at an approximate 5-6 Km distance from the project
■ According to the Zonal plan of the Delhi Development Authority (DDA) , the land use of the project is for manufacturing (light and service industry)
■ The Mundka – Ranikhera hub would cater to electronics component manufacturing, systems testing, IT hardware manufacturing, gems and jewellery manufacturing, semi-conductor manufacturing and bio-technology
■ The tentative cost of the project has been estimated at INR30.98 billion
Sources: DSIIDC website; Press articles
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Knowledge Based Industries Park, Baprola
■ DSIIDC is developing KBI Park at Baprola in an area of approximately 72.37 acres
■ Estimated project cost is INR12 billion
■ Project has been proposed to be completed in two phases and is expected to be fully operational by 2016
■ Expected employment — Direct (100,000 jobs) and indirect (170,000 jobs)
■ Project would cater to specific needs of IT/ITeS industry, media, research and development, gems and jewellery and business services
■ It would provide housing units for KBI workers and housing for economically weaker section
■ Project site is expected to be connected with the nearest metro through mono-rail
■ As of April 2012, the KBI Park at Baprola had received all the required sanctions from various civic agencies including those of Municipal Corporation of Delhi (MCD), DDA and the Fire Department
Sources: Government of Delhi; DSIIDC website; Press articles
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 15 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Haryana: a snapshot
Haryana has a rich industrial base, which is supported by robust infrastructure. With its vast resource base, the state has huge potential in the Agri-based sectors. This large industrial base has resulted in higher employment at 319 per 1,000 population than all-India average of 242 per 1,000 population.
Since, one-third of Haryana falls under the National Capital Region, the state has been able to attract sizable investments. The new Industrial Policy 2011 provides the right impetus to strengthen the base of the manufacturing sector besides knowledge-based and high-tech industries.
Besides, the state is well known for its handloom exports, Panipat being the largest exporter in India.
Source: Find Data website, www.findthedata.in , accessed on 12 August 2013; Government of Haryana; Press articles
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 16 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Haryana: a snapshot (cont.)
Overview
Geographic and demographic indicators GSDP composition ( percent )**
■ Geographical area (sq Km): 44,212 100
■ No. of districts: 21 80 48.8 50.3 52.7 53.7 54.6 ■ Capital city: Chandigarh 60 40 ■ Largest city: Faridabad 31.6 30.2 30.1 29.7 28.7 20 ■ Total population, 2011 census (million): 25.4 19.6 19.5 17.2 16.6 16.7 0 ■ Population density, 2011 census (persons per sq Km): 573 FY08 FY09 FY10 FY11 FY12 Agriculture Industry ■ Literacy rate, 2011 census (percent): 75.6 Economic indicators
■ GSDP*: Increased at a CAGR of 5.6 percent during FY08-FY13
■ GSDP composition**: Shifted in favor of services sector
■ Sector-wise CAGR**: Agriculture (4.8 percent), Industry (6.6 percent), Services (12.3 percent)
■ Per capita income, FY12**: INR62,927 (USD1,313) Note: 1 USD = INR 47.9 for FY12 *At constant FY05 prices (data as of August 2013) **At constant FY05 prices (data as of February 2013) Sources: Census 2011 (http://www.census2011.co.in/census/state/haryana.html); Government of Haryana
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 17 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Highlights on key sectors of the state (cont.)
■ State is preferred destination for many major automobile and auto component manufacturers
■ Highest producer of cars (36.3 percent), tractors (12.0 percent), two-wheelers (36.3 percent) and Automotive bicycles (8.0 percent)*
■ Important automobile centers are Faridabad and Gurgaon
■ One of the leading states in IT exports
■ Gurgaon is preferred centre for IT industry IT/ITeS ■ Key players: IBM Global Process Services, TCS, Microsoft and Google
■ Biggest employment generator in rural parts of state
■ State Government promotes organic farming by providing financial assistance to farmers Agro-based ■ Huge potential for dairy farming in rural areas; the state is one of the leading Indian states in milk availability
■ The Real Estate sector accounted for 9 percent of GSDP in FY12
■ State has witnessed rapid growth in residential, commercial and hospitality segments Real Estate ■ Key players: DLF, Unitech, Ansal Housing & Construction
*Figures in the parenthesis indicate the production in Haryana as a percent of total production in India Source: Government of Haryana, Rail Bandhu, June 2013
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 18 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Project-wise opportunities
Mass Rapid Transport System (MRTS) between Gurgaon – Manesar - Bawal
Project details
■ MRTS project would cover approximately 130 Km connecting the Delhi Metro plans
■ Estimated project cost of INR631.77 billion
■ 57 stations on the route that would also connect to the Indira Gandhi International Airport
Project background
■ Government of Haryana approved creation of Special Purpose Vehicle (SPV) for project and asked for initiation of land acquisition (as of February 2013)
■ Delhi Mumbai Industrial Corridor Development Corporation (DMICDC) floated a tender in February 2013 for selecting the consultant who in turn will prepare the detailed project report
■ Discussions have also been carried out with Japan International Cooperation Agency for loan by DMICDC
Source: Press articles
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Convention Centre at Pachgaon Chowk
■ Project area under consideration is approximately 400 acres, of which 150 acres to be developed in initial phase
■ Estimated project cost: INR25 billion
■ Proposed development:
‒ 194,758 sq meter to be designed for providing space to around 1,850 exhibition stalls ‒ 22,500 sq meter reserved for convention centre ‒ 113,155 sq meter to be allocated for proposed hotel building. ‒ 12,000 sq meter to be earmarked for retail and commercial activities
Source: Press articles
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 20 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Project-wise opportunities (cont.)
Multi-Modal Logistics Hub in Rewari
Project details
■ Proposed area: 900 acres in Manesar-Dharuhera-Bawal industrial belt
■ Expected investment: INR19 billion
■ Facility expected to be the largest proposed logistic hub of Northern India
■ To be developed through a Special Purpose Vehicle of Delhi Mumbai Industrial Corridor Development Corporation (DMICDC) and HSIIDC on a Public Private Partnership (PPP) model
■ As per DMIC plans, logistics hub would have a container freight station, custom-bonded and domestic warehouses, a railway sliding, a truck parking area, an auto zone and a container-handling facility
Project background
■ DMICDC and the Government of Haryana agreed in principle to form a joint venture for implementing the project
■ Techno-economic feasibility study approved by State Government and land acquisition process underway
■ Hub would be located in close proximity to Manesar, Dharuhera and Bawal to cater to their cargo requirements
■ In addition to Haryana, hub to be used by the NCR area, Punjab and Rajasthan for freight
Source: Press articles
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 21 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Status of the industrial model townships in Haryana
Under development Developed and under expansion ■ Industrial model townships in: ■ Industrial model townships in:
IMT Faridabad IMT Manesar Planned and development work yet to IMT Rohtak commence IMT Bawal ■ Industrial model townships in: Industrial Estate, Barhi (Phase I) IMT Mewat at Sohana Industrial Estate Karnal Land under acquisition Industrial Estate Rai (Phase I & II) ■ Industrial model townships in: Industrial Estate Barwala
IMT Kharkhoda Growth Centre Saha
Industrial Estate Dharuhera Industrial Estate Yamunanagar Land under acquisition and project to be developed under PPP model ■ Industrial model township in IMT Bidhal-Lath
Township is located at Tehsil Gohana in Sonipat District, nearly 70 Km from Delhi spread over 3,400 acres
Sources: Government of Haryana; CII © 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 22 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Investment opportunities
Industrial infrastructure Commercial, residential O&M services within Industrial units within the and institutional projects industrial estates industrial estates
■ Opportunities: ■ Industrial plots allotted to ■ Industrial and Investment ■ HSIIDC has several sites entrepreneurs for setting Policy 2011 of Haryana in various industrial ‒ O&M of STPs/CETPs up of industrial projects encourages PPP based estates for development in Industrial Estates and development of of hotels, convenience ‒ Water supply, Industrial Model infrastructure projects shopping complexes, distribution, treatment, Townships developed by majorly in industrial schools, hospitals etc. recycling and HSIIDC infrastructure, power, management solutions roads, bridges, health, ■ HSIIDC plans to develop ■ Upto 10 percent of tourism and education Vanijya Nikunj, a ‒ Distribution of plots/sheds reserved in sectors commercial complex in electrical power each industrial estate for Phase-V, Udyog Vihar, allotment to NRIs/ PIOs ■ HSIIDC has initiated Gurgaon, for which an ‒ Security services and for units with at least action for development of area of about 17 acres 33 percent FDI in total Industrial Model has been earmarked. ‒ Cleaning & solid waste investment Township under PPP Process for project model at Gohana, development is under ‒ Horticulture & Sonipat (3,400 acre) progress plantation services
■ Development of ‒ Provision & operation infrastructure in IMT at of transport system Kharkhoda (3,300 acre) within industrial areas started under PPP model ‒ Provision and management of
Sources: Government of Haryana; CII Parking facilities © 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 23 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Investment opportunities (cont.)
Delhi Mumbai Industrial Corridor (DMIC) Project initiative
Manesar - Bawal Investment Global City Project in Gurgaon Integrated Multimodal Logistics Region (MBIR) Hub (IMLH), District Rewari
■ Under the DMIC Project initiative, ■ Global City is proposed to be ■ Feasibility study for IMLH project investment regions at Manesar- developed as Second Node in completed Bawal & Kundli-Sonipat and Haryana (after Manesar Bawal Industrial regions at Faridabad- Investment Region) in Gurgaon over 1,100 acres ■ Project would be implemented Palwal & Rewari-Hissar identified jointly with DMICDC through an SPV with 50:50 shareholding ■ Concept Master Plan of Manesar- ■ DMICDC would provide between HSIIDC & DMICDC at Bawal Investment Region (MBIR) knowledge support for designing Bawal in Rewari district, over finalized and Development plan and creating infrastructure 1,000 acres approved by State government ■ City would be designed by ■ Various modules of project ■ Area of 402 sq Km would be integrating smart community include EXIM container yard & taken up for development initially concepts ranging from water, power to integration of IT services CFS, domestic container yard & ■ Area available for development in managing various public utilities warehousing, auto zone and would be 265 sq Km commercial area ■ Project components would include ■ Projected employment generation exhibition & convention centre, ■ Estimated project cost: INR30 is 1.6 million and population size high value innovation & billion and land is under is 3.2 million knowledge industries, central acquisition business district and township etc.
Note: Fourth sub-section of DMIC project initiative, MRTS between Gurgaon-Manesar-Bawal, discussed as a separate slide in Project-wise opportunities Sources: Government of Haryana; CII © 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 24 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Himachal Pradesh: a snapshot
Himachal Pradesh is regarded as one of the most dynamic hill states of India which is high on human development indices. The state has strong hydro- power base because of its abundant water resources and topography. It’s rich pool of semi- skilled and unskilled labor makes it an attractive investment destination.
In order to provide further impetus to the economy, the state is working towards improving the core infrastructure, making more land available for prospective entrepreneurs, and improving the reach of railways and promoting industrial growth
Sources: Find Data website, www.findthedata.in , accessed on 12 August 2013; Government of Himachal Pradesh
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 25 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Himachal Pradesh: a snapshot
Overview
Economic indicators
■ GSDP*: State GDP recorded a CAGR of 5.1 percent during FY08-FY13
■ GSDP composition**: Contribution of services has increased in the past five years
■ Sector-wise CAGR**: Agriculture (1.7 percent), Industry (7.8 percent), Services (10.4 percent)
■ Per capita income, FY13*: INR51,586 (USD948.3)
GSDP (INR billion)* GSDP composition (in percent)**
600 8.0 7.6 516 468 489 100 500 435 417 6.0 400 5.4 80 38.0 39.5 39.9 42.0 42.0 4.4 4.5 300 4.0 60 3.8 200 2.0 40 41.0 100 43.3 41.0 41.2 40.7 0 0.0 20 FY09 FY10 FY11 FY12 FY13 21.0 17.3 19.0 16.8 17.2 0 GSDP (INR billion) Growth (%) FY09 FY10 FY11 FY12 FY13
Agriculture Industry Services Note: I USD = INR 54.4 in FY13 *At constant FY05 prices (as of August 2013) **At constant FY05 prices (as of February 2013) Source: MOSPI © 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 26 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. State’s sector specific strengths: Pharmaceuticals
Sector opportunities
■ Opportunities exist in:
‒ Drug manufacturing ‒ R&D ‒ Packaging/labeling ‒ Transportation
■ Solan offers good investment opportunities. Past performance reveals the preference for the district (in particular tehsils such as Baddi, Nalagarh and Parwanoo) to have attracted high investment
■ A Biotechnology Park (BTP) in Aduwal, Solan had been cleared for development under Public Private Partnership (PPP) mode. Park would be spread over 35 acres and will have an incubation center and an industrial cluster. It is expected that the project will witness investment inflow of INR2 billion and generate 500 new jobs
■ State also developed an Export Promotion Industrial Park at Baddi at an investment of INR200 million 3,106State-wise Pharmaceuticals units in India (FY11) Himachal Pradesh is among the leading growth areas for the pharmaceutical (pharma) 1,524 704 667 552 525 sector in the northern region. With 364 pharma 434 376 364 334 units, state stood third after Delhi and Uttar Pradesh
Sources: First Pharmaceutical Census of India, FY11; Government of Himachal Pradesh; Press articles
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 27 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. State’s sector specific strengths: Tourism
Sector opportunities
■ State government proposed to upgrade civic infrastructure in major tourist destinations like Shimla, Manali, Dalhousie, Mcleodganj, Kasauli and Chailon on priority through funds raised from the Government of India (GoI) under the latter’s various schemes and through private investment
■ In order to increase the duration of the stay of the visitors/tourists, a special emphasis is being placed on development of activity-based tourism and opening up new sub destinations
■ GoI has sanctioned INR36.8 million for development of eco-tourism in the state. Of this amount, INR29.4 billion has been released for the following identified circuits ‒ Shimla( Mandli-Dodra Kwar) ‒ Kullu (Kullu-Manali-Kothi) ‒ Kinnaur (Shongtong-Pooh) ‒ Bilaspur (Shri Naina Devi Ji) ■ Other investment opportunities include:
Parking Entertainme Ropeways Developing Recreational Spas Resorts Ski slopes areas nt centres tourist sites centers Tourist Amusement Hotels Travel & tour Shopping Airports Multiplexes Golf course centres parks operations complexes
Source: Government of Himachal Pradesh
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 28 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. State’s sector specific strengths: Cement
Key enablers
■ With total limestone deposit estimated to be 8,630 million tonnes as of FY12, Himachal Pradesh offers immense potential for growth of cement industry
■ This is supported by growing demand emanating from development of infrastructure sector and towns/cities
District-wise limestone deposits (including cement), FY12 (in million tonnes)
1,800 1,650 1,650 1,600 1,400 1,250 1,120 1,200 1,020 1,000 1,000 800 500 600 410 400 200 10 20 0 Bilaspur Chamba Kangra Kullu Mandi Sirmour Shimla Solan Lahaul Spiti
Source: Annual Administration Report FY12, Department of Industries, Government of Himachal Pradesh
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Sector opportunities
■ Opportunities exist in: ‒ Mining ‒ Crushing/grinding ‒ Manufacturing ‒ Packing ‒ Equipment providers ‒ Transportation companies
■ Four upcoming cement plants in Mandi and Shimla have been proposed by companies like Lafarge, Dalmia, Harish Cements and India Cements
■ JP Associates is also in the process of setting up two new plants in Solan and Chamba
■ Total production capacity of the proposed plants is estimated to be 12.02 million tonnes per annum
Capacity of proposed cement plants (in million tonnes per annum) 3 2.8 2.0 2.0 2.0 2.0 2 1.3 1
0 JP Associates JP Associates Harish Cements Lafarge India India Cements Dalmia (Solan Plant) (Chamba Plant)
Source: Annual Administration Report FY12, Department of Industries, Government of Himachal Pradesh
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 30 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. State’s sector specific strengths: Agriculture and Horticulture
Comparative advantages
■ Diverse agro-climatic conditions enable growth of a variety of vegetables, fruits and cereals
■ High quality commercial production of apple, stone fruit, off-season and exotic vegetables
■ Low use of chemicals and pollution free environment
■ Diversification of farming through high value cash crops Sector opportunities
■ Contract farming: Maize, potato, ginger, garlic, tea
■ Organic farming: vegetables and pulses
■ Support services, such as bio-fertilizers, organic manures, bio-pesticides, seeds for promoting organic farming
■ Private sector participation can increase in seed production
■ Setting up micro-propagation units
■ Scope for private sector participation in agri-clinics and agri-business centers
■ Advanced post-harvesting facilities including cold storages and units for producing packaging trays and cartons
■ Fruit processing units including alcoholic beverages and marketing services
Source: Government of Himachal Pradesh presentation
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State Data Centre (SDC)
Project details
■ Department of Information Technology (DIT), Himachal Pradesh is building the SDC for the all government departments
■ SDC project would be setup through Public Private Partnership (PPP) model and selected agency would operate and maintain the same for five years
■ Status of project as on July 2013
‒ SDC is being built at Mehli; infrastructure put in place by Himachal Pradesh Housing and Urban Development Authority
‒ Request for Proposal floated for selection of SDC operator; pre-bid meetings held; corrigendum being prepared
‒ Go-Live of SDC: Six months post signing agreement with successful bidder
Project background
■ Under National e-Governance Plan, SDC identified as one of the core supporting components to consolidate services, applications and infrastructure to provide efficient electronic delivery of business services
■ These services can be rendered through common delivery platform supported by core connectivity infrastructure, such as State Wide Area Network and Common Services Centre connectivity extended down to Panchayat level
Source: Project Status, Department of Information Technology, Government of Himachal Pradesh
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Identification of Tourism Circuits
Project details
■ For HP, three tourist circuits have been identified :
‒ Circuit 1: Chandigarh- Swarghat- Bilaspur- Mandi- Kullu- Manali- Manikaran- Naggar ‒ Phase II, Circuit 1: Kalka- Berog- Solan- Shimla- Chail- Kufri- Naldara (private sector opportunity: INR250 million) ‒ Phase II, Circuit 2: Kangra-Dharamshala-Palampur-Dalhousie- Chamba (private sector opportunity: INR500 million)
■ In Phase I, study estimates investment opportunity to the tune of INR1.5 billion to build multi-level car parking, 5- star hotels, public toilets and rest rooms, beautification and landscaping, water sports centre, convention centre, motels and camping sites in Circuit 1 alone on PPP basis
Sources: Ministry of Tourism, Government of India; IL&FS
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Tourism, Housing and Infrastructure
■ Himachal Pradesh Infrastructure Development Board (HPIDB) is the nodal agency for executing a variety of projects, such as Tourism, Housing, and Infrastructure on commercial/PPP mode
■ Around 29 tentative projects have been identified which include -
‒ A INR10 billion tunnel-cum-over bridge project between Kalka and Shimla
‒ Three expressway corridors:
■ Una-Mandi ■ Una-Dharamshala ■ Solan-Rohru
‒ 15 nursing and 5 para medical colleges
‒ One integrated tourism development project
‒ A Himalayan Ski village
‒ Integrated IT and Biotechnology Parks
‒ A Special Economic Zone in Kangra district
Source: HPIDB (http://himachal.nic.in/hpidb/HPDIB_EOC.htm)
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 34 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Punjab: a snapshot
Punjab has been traditionally known to be an agrarian economy with high share of agriculture. Gradually, other sectors, such as manufacturing and services have increased their contribution to the economy, with services growing at the fastest pace
Sources: mapsofindia.com; MOSPI
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Overview
Economic indicators
■ GSDP: State GDP recorded a CAGR of 6.0 percent during FY09-FY13
■ GSDP composition: Shifted in favor of services
■ Sector-wise CAGR: Primary (1.0 percent), Secondary (5.4 percent), Tertiary (9.2 percent) during FY09-FY13
■ Per capita income, FY13: INR48,496 (USD891.5)
GSDP (INR billion) GSDP composition (percent)
100.0 1,646 1,800 1,565 90.0 1,477 1,600 1,386 80.0 1,304 43.2 44.1 45.3 47.0 48.7 1,400 70.0 1,200 60.0 1,000 50.0 800 30.2 30.9 40.0 30.8 30.0 29.5 600 30.0 400 20.0 200 10.0 26.7 25.0 23.9 23.0 21.8 0 0.0 FY09 FY10 FY11 FY12 FY13 FY09 FY10 FY11 FY12 FY13
Note: 1USD=54.4 INR Agriculture Industry Services GSDP at constant FY05 prices Source: MOSPI
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Priority sectors Priority sectors Priority sectors
■ Textiles ■ Manufacturing Clusters/hubs ■ Renewable energy ‒ Automobiles ■ Textiles and Woolens: Ludhiana, ‒ Bicycles Barnala, Mansa, Bhatinda, Amritsar ■ IT ‒ Steel re-rolling ■ IT: Amritsar, Mohali ■ Agro processing ‒ Sports & leather goods ■ Food: Amritsar, Ferozepur ■ Real estate ■ Petro: Bhatinda ■ Infrastructure ■ Tourism & Entertainment ■ Automobiles: Patiala ■ Biotechnology & Health ■ Sports and Leather goods: Jalandhar ■ Education ■ Bicycle and its parts: Ludhiana ■ Financial Services ■ Steel re-rolling: Mandi Gobindgarh ■ Retail ■ Sugar: Amritsar, Gurdaspur ■ Handtools: Jalandhar Parks ■ Textiles: Ludhiana ■ Food: Fatehgarh Sahib ■ Biotech: Chandigarh Township/SEZ ■ Electronics: Mohali (township) ■ IT, Electronics & Pharma: Mohali
Source: Government of Punjab
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 37 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Sector-wise opportunities ‒‒‒ Textiles
Sector opportunities
■ Punjab’s textile sector is strong on all aspects of value chain and thus offers diverse investment opportunities from raw materials to finished products (garments)
Yarn Ginning Spinning Weaving Bleaching, dyeing Fabrics Garment manufacturing Threads Woolens and hosiery
Sources: Government of Punjab; The World Bank; Press articles
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 38 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Sector-wise opportunities ‒‒‒ Renewable energy
Key enablers
■ More than 300 days of sunshine per annum; solar insolation estimated at 4-7 kwh/sq m
■ Rising demand for power
■ Developing technology to lower cost
■ Favorable policies and government schemes of renewable purchase obligation, renewable energy certificates
■ 40 percent subsidy on solar pumps to farmers
■ Rooftop programme where solar photovoltaic projects set on government buildings/universities
■ Single window clearance mechanism
■ Diverse investment opportunities for plants of variable sizes using a range of diverse sources — wind, solar, mini hydel and biomass
■ Agro residue estimated at 10 million tons can be used in biomass Sector opportunities
■ As of March 2013, Punjab’s approximate installed hydro power capacity is 3,015 MW besides renewable power capacity of (388 MW) of which solar is 9 MW
■ Punjab has the third highest installed solar power capacity in the northern region after Rajasthan and UP
■ Immense solar power potential presents opportunities for solar power generation companies,
Sources: Punjab Energy transmission and distribution companies, equipment companies, engineering, procurement and Development Agency; construction companies solar wafer manufacturers, solar-based appliances manufacturers, such as Press articles water heaters, solar-based desalination plants and solar pumps
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Sector opportunities (cont.)
■ Punjab Energy Development Agency awarded 250 MW of solar PV projects to be completed by December 2014 on Build-Operate-Own (BOO) basis which requires an estimated investment of INR20 billion
■ Potential for mini hydel is immense on account of various canals — Bhatinda, Kotla, Abohar, Sidhwan and Bhakra
■ Estimated power potential to be developed by 2022: Biomass (600 MW), waste to energy (50 MW), Small/mini/micro hydro (250 MW), solar (1,000 MW)
Sources: CEA; Press articles; Government of Punjab
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Key enablers
■ Punjab accounts for highest share in procurement of wheat and rice. In FY13, the state accounted for nearly 34 percent of wheat procurement and 30 percent of rice procurement
■ Agribusiness is one of the key focus areas of the new Industrial Policy, 2013 that has offered several tax incentives for the agro/food processing sector
■ 5,000 hectares have been identified for creating a land bank for new industrial projects
■ Punjab Agro-Industries Corporation (PAIC) is working towards facilitating investment in the sector along with adoption of new technology Sector opportunities
■ Large crop production presents opportunities for: Fertilizers, pesticides, manures Farm machinery and equipment (tractors, water sprinklers, power gensets etc.) Micro irrigation techniques Cold storage and warehouses Transportation companies etc.
■ Production of fruits and vegetables presents opportunities for: Processing such as fruit juices, pulp, jams, jellies, ketchup, sauces, pickles etc. Sorting, grading, packaging etc.
■ Other opportunities include: Poultry, Dairy etc Sources: Government of Punjab; Department of Food and Public Distribution, Government of India
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Plans: Power generation Plans: Urban infrastructure and towns
State intends to be power surplus by FY14 ■ State claims to be first in India to introduce Town Master Planning ; Six towns identified under this are Amritsar, In MW FY13 FY14 FY15 Bhatinda, Jalandhar, Ludhiana, Mohali and Patiala Demand 8,214 8,865 9,567 ■ Urban infrastructure Availability 5,872 8,884 11,484 By 2016, 147 cities/towns to be provided basic amenities Generation 5,872 7,564 8,884 (power, water, sewerage, waste management) at an New Plants 0 1,320 2,600 investment of INR100 billion Surplus (Deficit) (2,342) 19 1,917 ■ Master Plan Generation projects under construction Expected Commissioning Notified cities Project Developer date Amritsar Mohali Jalandhar Ludhiana Bhatinda Thermal projects (BOO basis)
Goindwal Sahib Unit I: March 2013 GVK Power Patiala Derabassi Mullanpur Kharar Banur (2x270 MW) Unit II: May 2013
Unit I: April 2013 Zirakpur Gobindgarh Abohar Srihargobindpur - Talwandi Sabo Sterlite Energy Unit II: August 2013 (3x660 MW) Unit III: December 2013 Cities in pipelines Rajpura Unit I: December 2013 L&T Power (2x700 MW) Unit II: April 2014 Hoshiarpur Roopnagar Rajpura Khanna Pathankot
Hydel projects Sangrur Gudaspur Batala Fatehgarh Sahib Kapurthala Mukerian Stage II (2x9 - March 2013 MW) Rama Mandi Jagraon Taran Taran Goindwal Dhilwan
Shahpur Kandi Hydel Nawan Sultanpur - March 2016 Baghapurana Talwandi Sabo - (206 MW) Shahar Lodhi
Sources: Government of Punjab; Press articles
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Diverse projects
■ Completed: Lotus Integrated Textile Park, Barnala ■ Upcoming: Stadium-cum-sports complex, Amritsar Project cost: INR1.1 billion (cont.) Area: 100 acres Area: 15 acres Developer: Abhishek Industries Cost: INR250 million Completed under SITP scheme Facilities: Badminton and basket ball courts, athletics stadium, Olympic size pool, sports mall, food court, hotel- Direct employment: 1,500 cum-residential complex for 200 occupants ■ Upcoming: Mega Logistic Park, Ludhiana Will host cultural events with 7,500 seating capacity Project cost: INR5 billion 2,000 cars and 16 buses can be parked Area: 150 acres 400 metre athletic track Developers: Container Corporation, and Punjab State Designs invited by Amritsar Improvement Trust Conware and Warehousing Corporation Final plan approved by government Container throughput: 0.45 million per annum (estimated) Construction to commence soon Commissioning date: 2017 Constructed as an expansion scheme of Ranjit Avenue ■ Upcoming: Integrated Education Hub, Jalandhar ■ Six more international stadiums Area: 43 acres To be built in Bhatinda, Jalandhar, Ludhiana, Mahilpur, Master plan to be prepared Mohali and Patiala
Source: Press articles
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Ludhiana Metro Rail Project
Project details
Length: ~29 Km
Implementation agency: Ludhiana Metro Rail Corporation, special purpose vehicle (SPV) created for the purpose
Project completion year: 2018-19
Expected investment: INR98.40 billion (per km cost expected to be INR1.75 billion for elevated track and INR3.25 billion for underground track)
Project Background:
■ In June 2011, the Punjab cabinet approved the DPR for the proposed Ludhiana Metro Rail project. The cabinet also gave its nod for the execution of metro project on Build Operate Transfer (BOT) model
■ In November 2012, the project report for Ludhiana Metro was submitted to Union Government for final approval
Source: Press articles
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Recreational Amusement Park, Ludhiana
Project details
■ In May 2013, the Punjab Cabinet approved the draft bill for the enactment of the Punjab Horse Race (Regulation and Management) Act 2013. The act would provide for setting up, management and operation of racecourses and betting activities. Additionally, licensing, regulation, control and management of horse races would also be provided
■ The Recreational Amusement Park has been planned to come up near Mattewara area on the banks of Sutlej river in Ludhiana, Punjab
■ The main recreational activities under this project would include a turf club on around 140 acres, an entertainment city, lakes, safari, a five-star hotel, colleges, a jungle retreat (for walks in woods), water park and many other amusement places
■ The estimated break-up of the total project cost of INR6 billion includes INR1.5 billion for the turf club, INR1.5 billion for the five-star hotel and INR3 billion for other tourism projects
■ PIDB plans to develop this project under Public Private Partnership (PPP) mode
■ Infrastructure Leasing and Financial Services Ltd. (IL&FS), hired by the Punjab Infrastructure Development Board (PIDB) to study all technicalities involved in the project and feasibility of different sections proposed in the park, submitted its detailed report to the government in August 2012
■ Earlier in June 2012, the district administration identified around 1,400 acres in Mattewara as part of land pooling
Source: Press articles
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Textile Park, Muktsar
Project details
■ SEL Group has announced a Greenfield Mega Integrated Textile Park at Village Panjava, Tehsil Malout in Muktsar, Punjab at an investment of approximately INR15 billion
■ Project was commissioned by SEL Textiles Ltd., a wholly-owned subsidiary of SEL Manufacturing Company Ltd., in April 2013; it commissioned the yarn spinning section which would have a capacity of nearly 200,000 spindles as per phase I
■ Total capacity of 188,160 spindles in ring spinning, 40 million metres per annum in denim fabric and eight million pieces of denim garments per annum
■ Cotton being the major raw material for the project, would be procured from the northern belt consisting of Punjab, Haryana and Rajasthan
Government policy which supported the project
■ Under the textile policy, a textile park with composite textile processing units from cotton to garment having a minimum fixed capital investment of INR2.5 billion, in the districts of Bhatinda, Ferozepur, Sangrur, Mansa, Mukatsar, Faridkot, Taran Taran, Barnala and Amritsar would be covered
■ The policy provides a provision for a 50 percent exemption from rural development fund (RDF), market fee and infrastructure development process for a period of 10 years or up to 50 percent of fixed capital investment, whichever is earlier, on cotton procurement; Additionally, 10 percent of the total land acquired/purchased by the investor would be allowed for commercial use without change of land use and external development charges
Source: Press articles
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 46 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Rajasthan: a snapshot
Rajasthan, a popular tourist destination is the largest state by area in the country with well developed infrastructure facilities. The state is well-known for its rich minerals and related industries, tourism and textiles industries and is also fast growing in automobiles and IT/ITeS. Given the vast potential, 323 industrial areas and 8 growth centres have been developed in the state. In order to facilitate investment, single window clearance mechanism is already operational in the state. Source: Government of Rajasthan; , Find Data website, www.findthedata.in , accessed on 12 August 2013 © 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 47 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Rajasthan: a snapshot
Overview GSDP (INR billion)* 2,278 Geographic and demographic indicators 2,500 2,147 2,000 1,745 1,862 ■ Geographical area (sq km): 342,239 1,600 1,500 ■ No. of districts: 33 1,000 ■ Capital city: Jaipur 500
■ Key cities: Jaipur, Udaipur, Kota, Jodhpur, Ajmer and Alwar 0 FY08 FY09 FY10 FY11 FY12 ■ Total population, 2011 census (million): 68.6
■ Population density, 2011 census (persons per sq km): 201 GSDP composition (percent)*
■ Literacy rate, 2011 census (percent): 67.1 100 80 Economic indicators* 45.6 47.2 47.9 46.5 47.5 60 ■ GSDP: State GDP recorded a CAGR of 9.2 percent during FY08- 40 32.0 31.4 30.9 31.1 FY12 32.6 20 22.4 21.4 19.5 22.6 21.4 ■ GSDP composition: This has marginally shifted in favor of 0 Services FY08 FY09 FY10 FY11 FY12
■ Sector-wise CAGR: Agriculture (7.9 percent), Industry (8.4 Agriculture Industry Services percent), Services (10.4 percent) Notes: 1 USD = INR 47.9 *At constant FY05 prices (data as of February 2013) ■ Per capita income: INR28,851 (USD602) in FY12 (latest available) Source: MOSPI
Source: Census 2011 (http://www.census2011.co.in/census/state/rajasthan.html)
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 48 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. State’s sector specific strengths Opportunities: Oil and Gas leading to Petrochemicals
Sector opportunities
■ Large reserves of oil and gas represent significant opportunity in view of the increased potential for development
■ Share of oil and gas production from the state has increased from NIL to 17.2 percent in case of crude and from 0.8 percent to 1.2 percent in case of gas during FY08-FY12
■ With increased oil and gas production, opportunities also exist in oil and gas transmission and distribution, underground lignite gasification and coal to liquid conversion plants
■ Throughput of transmission pipelines (product) grew at a CAGR of 8.5 percent during FY08-FY12
■ The state’s 2,572 retail outlets are the 7th highest in India
■ City Gas Distribution (CGD) network is under operation at Kota that is being carried out through over 90 km of distribution pipelines
■ Rajasthan State Refinery formed joint venture with Hindustan Petroleum Corporation Limited (HPCL) for setting a 9 million tonnes refinery cum petrochemicals units at Barmer at an investment of INR372 billion. It is the second biggest project in the state and will generate 3,00,000 jobs. It is expected to be completed by December 2017 and bring in INR86 trillion of investment Existing companies
■ Oil and Natural Gas Corporation, Cairn India, Indian Oil Corporation, HPCL, GAIL (India) Sources: MoPNG; PPAC; Press articles and GAIL Gas among others
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 49 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. State’s sector specific strengths Opportunities ‒‒‒ Solar power
Key enablers Total installed capacity and generation in Rajasthan*
■ Average per day solar incidence of 5-7 kWh/sq m translating 60 53.9 15000 49.5 into 1,600-2,000 kWh/sq m of power generation. Regions with 44.8 12155.6 40 10000 high solar radiation include Bikaner, Barmer, Jodhpur and 10160.9 8975.1 Jaisalmer 20 5000
■ Rising demand for power 0 0 FY11 FY12 FY13 ■ Rajasthan accounts for 81 percent of grid-connected scheme under National Solar Mission. Highest no. (12) of 1 MW projects Capacity (MW) Generation (BU) as per Rooftop and Small Solar Generation Programme Note: MW denotes Mega Watt; BU denotes billion units * Includes thermal, hydro, nuclear etc. Source: CEA ■ Developing technology translating into lower cost ■ Government schemes of renewable purchase ■ Favorable policies (10 year investment subsidy to the tune of 30 obligation, renewable energy certificates percent of tax deposited; exemption for 7 years from electricity duty, land tax, mandi fee to the extent of 50 percent) ■ Single window clearance mechanism
■ The state government improved the bidding process last year, ■ Endowed with minerals: Close to 99 percent of India’s wherein projects were allocated under reverse bidding and zinc concentrates lie here (used in solar structures power purchase agreements were to be signed with Rajasthan galvanization). Rich in other minerals, such as quartz, Renewable Energy Corporation Ltd. and salt required in Concentrating Solar Power (CSP) Sources: Government of Rajasthan; Press articles technology © 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 50 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. State’s sector specific strengths Opportunities ‒‒‒ Solar power (cont.)
Sector opportunities
■ Rajasthan has the highest installed solar power capacity in the northern region of 442 MW. This capacity accounts for a share of 92.3 percent in northern region’s solar power capacity and of 31 percent of total installed solar power capacity in India, as of March 2013
■ Immense solar power potential presents opportunities for:
‒ Generation companies
‒ Transmission and distribution companies
‒ Equipment manufacturing or leasing companies
‒ Engineering, procurement and construction (EPC) companies
‒ Solar wafer manufacturers
■ Opportunities also exist for solar-based appliances manufacturers, such as water heaters, solar-based desalination plants and solar pumps
■ State government plans on establishing Solar Energy Enterprise Zones (SEEZ) in Barmer, Jaisalmer and Jodhpur districts and is offering incentives for the same
■ Upcoming solar parks in Jodhpur, Bikaner, Jaisalmer
Sources: IREDA, NVVN, State agencies, Project developers; Press articles
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 51 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Government identified areas/zones present immense investment opportunities
Industrial areas Clusters/hubs Growth centres
■ Behror ■ Automobile: Bhiwadi ■ Abu Road
■ Bhiwadi ■ Glass and ceramic (upcoming): Ghiloth ■ Bhilwara
■ Ghiloth ■ Textiles (upcoming on PPP mode): Jodhpur, ■ Bikaner Bhilwara ■ Neemrana ■ Nagaur
■ Shahjhanpur ■ Sikar
Upcoming industrial areas Parks Mini growth centres
■ Khushkhera ext. ■ IT: Sitapura, Kota, Jodhpur, Udaipur ■ Baran
■ Tapukara ext. ■ Textiles: Pali, Bagru, Kishangarh ■ Bharatpur ■ Bhiwadi ■ Soniyana (Chittor) ■ Agro: Alwar, Jodhpur, Sriganganagar, Kota ■ Jodhpur ■ Kunjbiharipura (Jaipur) ■ Karauli ■ Karni ext. (Bikaner) ■ Pali ■ Gajaner (Bikaner) ■ Tonk
■ Borananda (Jodhpur) ■ Udaipur
Sources: Government of Rajasthan; Press articles
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Neemrana: Japanese Investment Zone I
■ MoU : Neemrana Industrial Estate developed as per MoU between RIICO and Japan External Trade Organization (JETRO)
■ Delhi-Mumbai Industrial Corridor (DMIC) : This region to be part of much-talked about DMIC project
■ Investment : INR42 billion invested; expected employment: 9,120
■ Area : 1,167 acres, of this, close to 494 acres allotted to more than 25 companies (expected investment and employment: more than INR25 billion and 3,000 respectively)
■ Sector presence : Most companies belong to automobile sector
■ Key investments: Daikin (INR6 billion), Mitsui Chemicals (INR4 billion), Mikuni India (INR1.5 billion), NYK Logistics (INR1 billion) ; Nippon Steel (INR3 billion exp)
■ Units in production : 24 (Nissin Brake, Daikin Airconditioning, Mikuni, Nippon, Mytex Polymer etc.)
■ Proposed infrastructure development : Cargo airport between Ajarka and Kotkasim, and super express highway through Neemrana
■ Gaining international attention : African delegation of 25 members from 15 countries and a delegation from Taiwan Electrical and Electronic Manufacturers’ Association visited Neemrana
Rajasthan is the only state in the country to have three international investment zones
Sources: Government of Rajasthan; Press articles
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 53 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Government identified areas/zones present immense investment opportunities (cont.)
Ghiloth: South Korean Investment Zone
■ The investment zone being developed as per MoU signed between the RIICO and Korea Trade Investment Promotion Agency (KOTRA)
■ Approximately 250 acres of land earmarked
■ Automobile and electronic sector companies have evinced greater interest
■ It will house a ceramic and glass hub, solar equipment manufacturing etc.
■ Gas supply being considered by GAIL
■ Area to be operational by 2014
Ghiloth: Japanese Investment Zone
■ The success of Japanese Investment Zone I laid the foundation for Japanese Investment Zone II
■ For the new phase, 500 acres of land will be made available
■ Central sales tax concession being offered to Japanese investors
Rajasthan is the only state in the country to have three international investment zones
Sources: Government of Rajasthan; Press articles
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Delhi-Mumbai Industrial Corridor Project details
■ Length: 1,483 km
■ States: UP, Delhi, Haryana, Rajasthan, Gujarat and Maharashtra
■ Project implementation: Special Purpose Vehicle, Delhi Mumbai Industrial Corridor Development Corporation
■ Around 40 percent of project areas falls in Rajasthan
■ Objectives: Provide high speed connectivity for high axle load wagons (25 tonnes) of double stacked container trains; create at a global manufacturing and trading hub
Investors
■ Government of India (49 percent)
■ Japan Bank for International Cooperation (26 percent)
■ Housing and Urban Development Corporation (19.9 percent)
■ Others include India Infrastructure Finance Company (4.1 percent) and Life Insurance Corporation of India (1 percent)
Sources: Government of Rajasthan; DMIC; Press articles
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Core project areas Delhi-Mumbai Industrial Corridor (cont.) Industrial areas Investment regions First phase of development (2008-12) Khushkhera-Bhiwadi- Jaipur-Dausa Neemrana ■ Government approved financial assistance of INR25 billion per city Rajsamand-Bhilwara Ajmer-Kishangarh for development of Dadri, Noida, Ghaziabad, Manesar, Bawal, Khushkhera, Bhiwadi, Neemrana, Ahmedabad, Dholera Jodhpur-Pali-Marwar
DMIC’s major junctions in Rajasthan Second phase of development (2013-17) Phulera, Marwar, Bangurgram
■ First phase of development: Six investment regions and six Other areas for development industrial areas identified for investment ■ Industrial townships being planned in ■ Second phase of development: Five investment regions and Khushkhera-Bhiwadi-Neemrana and in seven industrial areas identified for investment Jodhpur-Pali-Marwar regions ■ Greenfield airport, 24 sq km ■ Expected investment in project’s cities: USD90-100 billion ■ Road corridor to connect Bhiwadi-Tapukara industrial complex with Shahjahanpur- ■ Development of airports Neemrana-Behror urban complex ■ Development of townships: 25-50 sq km in cities by 2019 ■ Jodhpur-Pali-Marwar region to have an airport, multi-modal logistics hub and mass rapid transit ■ Germany has evinced interest for investing in the project system ■ Knowledge city Khushkhera-Bhiwadi-Neemrana
Sources: Government of Rajasthan; DMIC; Press articles 12.3 sq km
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Gyanodaya Schools Project Background Project details ■ Government of Rajasthan (GoR) plans to build 165 new ■ Objective: To provide equitable quality education in rural senior secondary schools, of which five schools are areas proposed to be built in each district of Rajasthan on PPP basis ■ Project: Building secondary schools (Class VI-XII) in areas where there is no such school in a 5 km radius Project status ■ Estimated cost: INR6 billion
■ Project bid criterion: Viability Gap Funding (VGF) ■ As of 31 March 2013, for Phase-1, the applicants have been shortlisted and VGF has been sanctioned by the ■ Project type: PPP on design, build, finance, operate and Government of India (GoI) for the following areas: transfer (DBFOT) basis for 30 years after which, the ‒ Ajmer assets would be transferred to the Government ‒ Bhilwara ‒ Banswara Phase-1 ‒ Chittorgarh ‒ Dungarpur ‒ Nagaur ■ Phase-1 aims at constructing 50 schools in Ajmer (four ‒ Pratapgarh districts) and Udaipur (six districts) ‒ Rajsamand ‒ Tonk ■ Total investment in Phase-1, comprising 50 schools, has ‒ Udaipur been estimated to be INR2,074 million ■ The applicants for the remaining schools would be shortlisted in the upcoming phases of the project Source: Press articles
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Gyanodaya Schools Project (cont.) Fiscal support Indicative project financials State Government ■ Project cost: INR6,000 million (Phase-1: INR2,074 million) ■ PPP school land to be provided on a 30 year lease ■ Internal rate of return (IRR): 14-16 percent basis to the private partner at nominal lease rent
■ Average debt service coverage ratio: 2.1 ■ Construction subsidy with a ceiling of INR5 million per school
Centre Revenue model ■ VGF of 20 percent of the project cost
■ Fee from private/open market students would be market- ■ GoI approved financial assistance for the project based under the India Infrastructure Project Development Fund (IIPDF) ■ Fees of Government-nominated voucher students would be reimbursed by GoR ■ Project development entails structuring, financial modelling, bid documents preparation and bidding ■ Voucher amounts would be calculated by GoR based on process assistance. But, no financing support would Public Sector Comparator, linked to consumer price index be provided during the operations
■ Additional revenues from any supplementary activities ■ Asian Development Bank (ADB) has also provided undertaken by the school to the operator partial financial support for project development activities
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Water supply and sewerage system plants
Udaipur Ajmer and Pushkar
■ Estimated cost: INR7 billion ■ Estimated cost: INR10 billion
■ Project type: PPP on DBFOT basis ■ Project type : PPP on DBFOT basis
■ Objective: Rehabilitation, augmentation and operation ■ Objective: Rehabilitation, augmentation and of the water supply and sewerage system operation of the water supply and sewerage system
Both projects are currently in the pipeline stage and are being managed by Public Health Engineering Department, Government of Rajasthan
Status of the projects:
As of 31 March 2013, consultants submitted respective feasibility reports for both projects. Observations on the same communicated. Modified reports are still awaited
Source: Press articles
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Nine textile parks under SITP
■ Scheme for Integrated Textile Parks (SITP): Aims at facilitating development of Integrated Textiles Parks (ITPs) in India under PPP model
■ In March 2013, Ministry of Textiles started forming a panel of Project Management Consultants for implementing the projects sanctioned under the 12th Five Year Plan
■ Scheme would be implemented through project specific Special Purpose Vehicle (SPV) of the user industry with one project SPV for one park. Each ITP expected to have 50 units
■ GoI’s support under the scheme by way of grant or equity would be limited to 40 percent of project cost, which cannot exceed INR400 million. Also, the grant cannot be used to purchase land for the ITP
■ The following textile parks have been approved in Rajasthan under SITP:
‒ Jaipur Texweaving Park, Kishangarh
‒ Kishangarh Hi-Tech Textile Park,
‒ Next Gen Textile Park Pvt. Ltd., Pali
‒ Jaipur Integrated Texcraft Park Pvt , Bagru
‒ Bharat Fabtex and Corporate Park, Pali
‒ Jaipur Kaleen Integrated Textiles Park, Dausa
‒ Mewar Industrial Textile Park, Pali
‒ Himmanda Integrated Textile Park, Baltora
‒ Rajasthan Integrated Apparel City, Tapukara
Source: Press articles
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 60 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Uttar Pradesh: a snapshot
Uttar Pradesh (UP) is the biggest state economy in the northern region with a share of approximately 31 percent in the region’s GDP. It is mainly driven by the services sector and within the services sector, trade, hotels, real estate, transport, storage and communications are the prominent sectors
Source: Find Data website, www.finddata.in , accessed on 12 August 2013 © 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 61 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Uttar Pradesh: a snapshot (cont.)
Overview
Geographic and demographic indicators
■ Geographical area (sq Km): 240,928
■ Total population (million): 199.6
■ Population density (persons per sq Km): 828
■ Literacy rate (percent): 69.7
Economic indicators*
■ GSDP: INR4,451.7 billion (USD81.8 billion) in FY13 compared to INR3,222.1 billion (USD80.1 billion) in FY08, CAGR of 6.7 percent
■ GSDP composition (FY13): Agriculture (21.9 percent), Industry (23.2 percent), Services (54.9 percent)
■ Sector-wise CAGR (FY08-FY13): Agriculture (3.0 percent), Industry (4.6 percent), Services (9.5 percent)
■ Per capita income (FY13): INR18,891 (USD347.3)
*At constant 2004-05 prices, GSDP and per capita income data is as of 1 August 2013, GSDP composition and sector-wise CAGR data is as of 27 February 2013 Sources: Census 2011; MOSPI; Find Data website, www.finddata.in , accessed on 12 August 2013
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Sector opportunities
■ Investment worth INR230 billion planned for 2,500 Km of state highway projects
■ 6,730 Km identified as core network by the World Bank, of which 2,466 Km has been developed by UP Public Works Department (UPPWD)
■ Concession agreement signed for four roads of 463 Km, costing INR38.7 billion
■ Feasibility study has been completed and proposals for VGF are being sent to the Central Government for 11 roads of 977 Km, costing about INR71.3 billion
■ 11 hi-tech townships and 31 integrated townships are being developed by private developers in major cities of the state
■ One National Manufacturing Investment Zone being planned each in Jhansi and Auraiya
■ Airports on PPP model – near Agra in the vicinity of Delhi Mumbai Industrial Corridor (DMIC) to provide facility of dry-cargo transport along with aircraft maintenance hub and at Kushinagar in eastern Uttar Pradesh to promote industrial development and tourism
■ DMIC: Immense opportunities for development of an industrial corridor along the alignment of dedicated freight line
■ The Government of UP (GoUP) envisages Industrial Estates and Logistic Hubs along Eastern Dedicated Freight Corridor (EDFC)
Source: Udyog Bandhu
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Key infrastructure projects in PPP
Project Size capacity Project cost (INR billion) UP State Highways Authority
Delhi-Saharanpur-Yamunotri Road (SH-57) 206 Km 17.2 Varanasi - Shaktinagar (SH-5A) 115 Km 12.1 Pallia – Shahjahanpur – Hardoi – Lucknow 162.4 Km 12.9 Road (SH-25) Akbarpur – Tanda – Jaunpur – Mirzapur – 237 Km 18.7 Dudhi Road (SH-05) Yamuna Expressway Development Authority Yamuna Expressway Construction (Noida to 165 Km 103.7 Agra – 165 Km long) UP Expressways Industrial Development Authority
08-Lane Access Controlled Expressway from 1,047 Km 300 Greater Noida to Ballia 06-Lane Access Controlled Expressway from na 95.5 Agra to Lucknow 08-Lane Access Controlled Expressway on the 148 Km 89.1 right bank of Upper Ganga Canal from Sanouta Bridge (Greater Noida) to near Purkaji (Dist Source: Udyog Bandhu Muzaffarnagar)
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Key infrastructure projects in PPP (cont.) Project Size capacity Project Cost (INR billion) UP Expressways Industrial Development Authority Development of 06-Lane Access Controlled 363.8 Km 78.96 Expressway on the right bank of Upper Ganga Canal from Sanouta Bridge (Greater Noida) to Kanpur-Fatehpur Agra to Kanpur Access Controlled Expressway 243 Km 73.2 Jhansi-Kanpur-Lucknow-Gorakhpur to Kushinagar 626 Km 192.9 08-Lane Access Controlled Expressway Lucknow-Barabanki-Nanpara Link Expressway 133 Km 29.8 Kotdwar-Bijnor-Moradabad to Fatehgarh Access 313 Km 80.7 Controlled Expressway Narora to 10Km before Uttarakhand border Access 151 Km 28.9 Controlled Expressway UP Power Corporation Ltd. 3x660 MW Bara Thermal Power Project (Tehsil- 1,980 MW 115 Bara, district Allahabad) 2x660 MW Karchhna Thermal Power Project 1,320 MW 79.2 (Tehsil-Karchhna, district Allahabad) 2x660 MW Jawaharpur Thermal Power Project, 1,320 MW 66.0 district Etah Source: Udyog Bandhu
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Key infrastructure projects in PPP (cont.)
Project Size capacity Project Cost (INR billion) UP Power Corporation Ltd. 3x660 MW Dopaha Thermal Power Project 1,980 MW 120 (Sonebhadra) Transport
Selection of Private operators/ investors to operate - 16 stage carriage buses
Source: Udyog Bandhu
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Sector opportunities
■ Availability of highly skilled manpower for IT/ITeS industry – premier institutes including IIT Kanpur, IIM Lucknow, IIIT Allahabad, IMT Ghaziabad, C-DAC Noida and IT-BHU are located in the state
■ The UP Government is planning a 100-acre ‘IT City,’ which would come up on Lucknow- Sultanpur highway
■ The IT park project in Lucknow is proposed to be developed at an estimated cost of INR2,850 million on an area of approximately 130,000 sq meter by Lucknow Industrial Development Authority (LIDA)
Source: Udyog Bandhu
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Sector opportunities
■ 2,101 agriculture marketing hubs being set up for grain storage, farmer service centers, banks and primary processing units costing INR3.5 billion
■ With a population of 200 million, UP offers the largest market for consumption of food products
■ Huge opportunity exists as currently only 2 percent of total produce of fruits and vegetables is commercially processed
■ Presence of relatively low-cost skilled workforce
■ Favorable policy environment
■ Large consumer base of 200 million with growing per capita income
■ Proposed industrial infrastructure: Plastic City at Auraiya; Leather Mega Cluster at Kanpur, Agra, Hardoi; Integrated Dairy Park at Lucknow; Mega Food Park at Jagdishpur; Textile Park at Fatehpur
Sources: Udyog Bandhu; Press articles
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Key growth and opportunity segments in Uttar Pradesh Segment Key Strengths and Opportunity areas
Chemicals • Produces approximately 6 percent of India’s total production of Chemicals and • Home to some of the major chemical manufacturers, such as Tata Chemicals, Fertilizers Kanoria Chemicals and Jubilant Life Sciences • Abundant availability of raw material for production of fertilizers in Bundelkhand area • Rock phosphate found in Lalitpur is sold as a direct fertilizer and used as raw material for phosphorus plants Segment Key strengths and opportunity areas Engineering • Noida and Ghaziabad are home to several original equipment manufacturers Goods (OEMs) and auto component suppliers • Centre of National Automotive Testing and R&D Infrastructure Project (NATRIP) is being set up • A centre for providing complete homolocation service to agri-tractors, off-road vehicles, diesel generation sets as per Indian and global standards Leather • Second largest producer after Tamil Nadu • Contributes about 28 percent to India’s total exports of leather and leather products • Over 900 acres of land sanctioned for setting up two Leather Parks in Sandila (District Hardoi) and at Ramaipur (District Kanpur) which will attract an estimated investment of INR20 billion • Kanpur and Agra are notified as ‘Towns of Export Excellence’ for leather products • Multi level skill development centre at a total project cost of INR92.4 million and testing laboratory in Kanpur at a project cost of INR97.6 million are planned by the Council for Leather Exports at Kanpur • Footwear Design and Development Institute (at Noida) – a one stop solution provider for footwear, leather products and allied industries Source: Udyog Bandhu
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Sector opportunities (cont.)
Key growth and opportunity segments in Uttar Pradesh Segment Key Strengths and Opportunity areas
Sugar • Second largest sugar producer of India accounting for about 28 percent of total output • Easy access to raw material and huge potential of establishing new units in Eastern UP • Huge demand for by products • Conducive policy support to harness the sector’s high potential
Cement • Ninth largest in production of cement with production of 7.05 million tones per annum • Abundant availability of raw material in Bundelkhand area ideal for setting up cement manufacturing plants • Major investments by leading groups for establishing new cement plants and expansion of existing plants Textiles • The state offers complete range of handloom products like home furnishing, floor coverings, bed covers, bed sheets and dress material and a vast range of woven and printed saris made of cotton and silk Existing companies• Accounts for approximately 5.6 percent share of total weaving units in handloom sector in India • Mirzapur and Bhadohi are major centers for the production of carpet floor coverings and account for approximately INR20 billion of export
Source: Udyog Bandhu
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■ Uttar Pradesh Expressways Industrial Development Authority (UPEIDA) has been Agra to nominated as the nodal agency for the development of this project Lucknow access ■ The expressway will start from proposed Agra Ring Road and end at proposed Lucknow Ring Road; It will reduce the distance between Lucknow and Agra to 270 Km from the controlled current 335 Km expressway ■ Concept report has been prepared and the request for quote/request for proposal project (RFQ/RFP) is expected to be floated by the middle of 2013 ■ The expressway is proposed to be linked through Link Expressways from existing and potential commercial/agricultural hubs, such as Firozabad, Shikohabad, Etawah, Kannauj and Malihabad
■ The state tops in the production of potatoes accounting for 34 percent share in the country’s potato output Potato flakes ■ A plant has already been established near Hapur for potato flakes manufacturing and potato ■ The State Government is planning to incentivize potato-based vodka manufacturing based Vodka keeping in view its huge potential manufacturing ■ A major distillery is in the process of establishing a vodka manufacturing plant near Rampur
Sources: Udyog Bandhu ; Press articles
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■ 29.5 Km long rail link on the Noida-Greater Noida route from Noida City Centre to Boraki to be developed by 2017 at an estimated cost of INR50 billion Noida and ■ The State Government has approved the formation of special purpose vehicle (SPV) — Noida Metro Rail Company — to implement the project Lucknow Metro ■ The UP Cabinet has also given its approval to the first phase of 23 Km-long Lucknow Metro rail Project, which is estimated to be completed by March 2018 ■ The first phase of the project to cost around INR70 billion ■ For this also, an SPV – Lucknow Metro Rail Corporation — will be formed
■ The UP Government is planning a 100-acre ‘IT City’ on Lucknow-Sultanpur highway ■ The proposed city will be built on about 100 acres of government land at Gajaria farms on Information Sultanpur Road in Lucknow Technology City, Lucknow
Sources: Udyog Bandhu; Press articles
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■ 100 acre at Auraiya district Plastic City Dibiyapur ■ First Plastic City project of UP , to be developed through PPP (Auraiya) ■ MoU signed with GAIL for smooth supply of raw material ■ 200 MW power plant being built adjacent to the site
■ Excellent Railway Connectivity
■ Excellent Road connectivity to major cities like Agra, Lucknow, Kanpur, Gwalior
Agra ■ 102 acre land at a cost of INR 21 cr for setting up export oriented units Export ■ Construction activities on allotted plots ( ~80% ) Promotion Industrial Park Greater Noida ■ Over 200 acre land ■ Infrastructure facilities at par with international standards ■ Production & exports commenced in 4 units. Construction of factory building in 11 units Sources: Udyog Bandhu; Press articles
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Agriculture ■ Seeds, urea and pesticides provided to farmers during rabi season at a pre-determined price
■ A scheme, ‘Bhoomi Sena Yojana’ introduced to enable farmers convert their flood-affected, barren, unproductive land for agriculture use
■ Conducted program, ‘Apni Mitti Pehchane’, to discuss fertilizer quantity to be used
■ Distributed Kisan Credit Cards to farmers
■ Markets created at every 10 Km for enabling easy purchase and sale of agricultural produce
■ Under the ‘Janeshwar Mishra Gramya Yojana’ and development works, over 1,000 villages selected and allotted more than INR2.5 million each
Work under progress Plans to develop
Agra inner ring road Food park in Jagdishpur
Ghaziabad northern peripheral road Plastic city in Auraiya
Four-lane highways to connect district Agro park in Shahjahanpur headquarters Agra and Kushinagar international airports -
Source: Rail Bandhu, June 2013
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Uttarakhand is one of the popular tourist destinations of the northern region. The state economy is driven by the services and the manufacturing sectors, with each recording a CAGR of more than 11 percent between FY08 and FY13. The manufacturing sector is diverse. In terms of investment, electricity generation is the key attraction among all other sectors.
Sources: Report on Investment Climate in Uttarakhand; CII; CSO; Find Data website, www.findthedata.in , accessed on 12 August 2013
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 75 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Uttarakhand: a snapshot (cont.)
Overview
Geographic and demographic indicators
■ Geographical area (sq Km): 53,483
■ Total population (million): 10.1
■ Population density (persons per sq Km): 189
■ Literacy rate (percent): 79.6
Economic indicators*
■ GSDP: INR631.6 billion (USD11.6 billion) in FY13 compared to INR380.2 billion (USD9.4 billion) in FY08, CAGR of 10.7 percent
■ GSDP composition (FY13): Agriculture (10.9 percent), Industry (35.7 percent), Services (53.4 percent)
■ Sector-wise CAGR (FY08-FY13): Agriculture (3.6 percent), Industry (11.1 percent), Services (11.8 percent)
■ Per capita income (FY13): INR53,548 (USD984.3)
*At constant 2004-05 prices, GSDP and per capita income data is as of 1 August 2013, GSDP composition and sector-wise CAGR data is as of 27 February 2013
Sources: Census 2011; MOSPI ; Find Data website, www.findthedata.in , accessed on 12 August 2013 © 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 76 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Sector-wise opportunities ‒‒‒ Tourism
Sector opportunities
■ Largely untapped potential due to inadequate capital investment in tourism infrastructure. So, opportunities exist in creation of modern tourism infrastructure, such as tourists accommodation facilities, Tourism Information Centers (TICs) and the development of air and road transport
■ Opportunity in developing several pilgrimage destinations, such as Panchbadri, Panchkedar, Panchprayag and Patal Bhuvaneshwar
■ Opportunity in developing cultural, adventure, wildlife and eco-tourism
■ Develop new tourist destinations, such as New Tehri, Pauri, Khirsu and Lansdowne
■ Adequate availability of literate human resources conducive to tourism industry development
Sources: Tourism Policy of Uttarakhand; Press articles; Primary interviews
© 2013 KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member 77 firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Sector-wise opportunities ‒‒‒ Hydel power
Sector opportunities
■ Abundant hydro potential and less than 20 percent harnessed
■ Many sites for developing Micro (up to 100 KW), Mini (100KW-5 MW) and Small (5-25 MW) Hydro power projects
■ Uttarakhand is being developed as an ‘Energy State’ to tap its huge Hydro Electric Power (HEP) potential of approximately 27,039 MW
■ Untapped potential of about 600 MW that could be harnessed before 2020 through Micro/Mini/Small Hydro projects
■ Opportunities exist in renovation, modernization and upgradation of various hydro projects, such as Kulhal, Dhakrani, Dhalipur, Khodri, Chibro, Tiloth, Ramganga and Chilla
■ Investment opportunities exist in following hydro projects:
‒ Large and Medium Hydro Projects: Utyasu Stage I to IV, Ming – Nalgaon, Garbyang, Budhi, Malipa, Tawaghat Tapovan, Tapovan Kalika, Kalika Baluwakot
‒ Small hydro projects: Guptkashi, Asiganga-III, Chamoli, Pilangad-II, Sonegad, Painagad, Suringad-II, Tankul, Urgam-II, Bhilangana 2A, 2B and 2C
■ Joint venture investment possibility in Tamak Lata, Bowla Nand Prayag, and Nand Prayag Langasu hydro projects
Source: CII, Uttarakhand Jal Vidyut Nigam Ltd., Primary Interviews
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Sector opportunities
■ The IIEs offer best possible industrial infrastructure, such as roads, water, sewerage, power connectivity, street lighting, labs, hotels, hospitals and educational institutions
■ SIIDCUL Phase-II is being developed at Sitarganj in approximately 1,700 acres of land with world-class infrastructure, air connectivity, commercial complex, hospitals and schools
■ SIIDCUL to develop high class Food Parks, generating investment opportunities in food processing
■ Knowledge City is being developed at Escort Farm, Kashipur on around 330 acres of land
■ Perfect location - The National Capital Delhi is 255 Km away from Dehradun, the interim capital of the state. Chandigarh, another hub of commercial activities, is also well connected by National Highway-72 and is 180 Km away
■ Connectivity : The state offers good connectivity through rail, road and air. Dehradun and Pantnagar have operational airports. New airstrips and heliports are also proposed in the state
■ Logistic hub: Logistic hub would connect SIIDCUL with the rest of the country as it would facilitate industries with container for exports of their goods
■ Availability of railway yard would minimize transportation cost
■ Highly educated human resource base: The presence of a large number of educational and technical institutions assures easy availability of an English speaking and skilled Source: Press Articles workforce. The state has traditionally been known for its world class education institutions
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Kedarnath ropeway
■ The Uttarakhand Government is exploring the possibility of building a 14 Km long ropeway from Gaurikund to the Kedarnath shrine
■ The construction of the ropeway is estimated to cost more than INR1 bilion
■ The stretch between Gaurikund, Rambada and Kedarnath was destroyed in floods and landslides that occured in June 2013
■ The Government has been planning to bid out Kedarnath Ropeway through PPP mode in the next few months and the process is under way
■ The Government is also planning to bid out Hemkund Sahib Ropeway
■ The Government has also conducted technical studies for other ropeways including Binsar Road to Kasar Devi temple in Almora, Rishikesh to Kunjapuri, Snow view to Nanital Zoo, Chakrata to Tiger falls and at Dayara Bugyal
Sources: Press articles; Interviews
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Other projects
■ Development of Tehri Lake: Tehri lake is one of the biggest man-made lake which could be developed as a major tourism hub. The State Government wants to develop the whole Tehri area with active participation from private sector
■ Running of Tourist Information Centres (TICs): The State Government has built many TICs all across the state and plans to run these TICs under PPP mode
■ Heli connectivity: The State Government wants to provide helicopter services all across the state. It has built heliports and helipads all across the state along with civil aviation department. The Tourism Department has invited all private helicopters services to provide heli connectivity in the state
■ Development of a 5 star property: The State Government has recently floated a bid to develop 10 acres of land in Dehradun on PPP basis to develop a 5-star property along with world class convention centre facilities. The State Government invited all leading hotel chains to participate in the bid process
Sources: Press articles; Interviews
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