MADHYA PRADESH THE LAND OF DIAMONDS

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1 SANCHI STUPA IN SANCHI, THE LAND OF DIAMONDS March 2018

2 Table of Content Executive Summary...3 Advantage State Vision Madhya Pradesh An Introduction....6 Budget Business Opportunities...41 Doing Business in Madhya Pradesh State Acts & Policies

3 EXECUTIVE SUMMARY Strong economy GSDP of Madhya Pradesh grew at a compound annual growth rate (CAGR) of 15.21% between FY12 and FY17. The state is rich in natural resources: fuels, minerals, agriculture & biodiversity. Rich in natural resources Madhya Pradesh has ample reserves of coal & coal-bed methane (8.38% of India s total coal reserves & BCM of methane). The state has the largest reserves of diamond & copper in India. Madhya Pradesh has significant reserves of limestone, manganese & dolomite. Potential for tourism Madhya Pradesh boasts of rich ancient cultural & religious heritage. Due to a thick forest cover, the state has immense potential for wild life, adventure & eco-tourism. Due to its centralised location, Madhya Pradesh has excellent connectivity. Many FMCG companies have moved their warehouses here to save on logistics expenses. Infrastructure support Upcoming theme based SEZs near Jabalpur, industry parks in Indore & food parks at multiple locations aim to promote sectoral growth. MP is emerging as a solar power hub with an installed solar capacity of 1.14 GW as of October Source: Directorate of Economics and Statistics, Government of Madhya Pradesh; Ministry of Petroleum & Natural Gas, MNRE 3

4 ADVANTAGE Strategically located business hub The state is centrally located in India. Major consumer goods multinationals are situated in Madhya Pradesh in order to access major consumer markets & metro urban communities like New Delhi (740 km1), Mumbai (780 km1), Kolkata (1,350 km1) & Chennai (1,435 km1) Geographical proximity with the automotive hub of NCR has favorably impacted Madhya Pradesh s auto ancillary industry. The state s well developed automotive cluster is now home to around 30 auto component & ancillary units. Rich resource pool Madhya Pradesh adds around 270,000 graduates to the workforce each year, of which around 90,000 have technical skills. At labour costs of US$ 3.7 per day, the state has a significant cost advantage over metros. The state houses some of the country s most reputed institutes including Indian Institute of Management, Indian Institute of Foreign Management & Indian Institute of Technology. Advantage Madhya Pradesh Attractive investment avenues With around 33% of the region under forests, Madhya Pradesh has an enormous potential for drug, wood & agro-based commercial enterprises. Ideal soil & climatic conditions have made it a primary producer of coarse cereals, oilseeds & soybean in India. The cluster-based advancement methodology promotes investments in automotive, textiles & biotechnology. Plentiful limestone & coal reserves give development avenues for the cement industry. A rich cultural heritage, scenic beauty & wildlife sanctuaries offer a promising tourism industry. Indore is all set to be the new IT capital with TCS & Infosys opening their offices. Policy and infrastructure support Madhya Pradesh offers distinctive monetary & strategy/policy incentives for organisations under the Industrial Promotion Policy-2010 & Action Plan, other than strategies/ policies for IT, biotechnology, tourism & SEZs. To pull in investors and promote entrepreneurs, the state government has selected TRIFAC, an agency that encourages a single window system, for speedy approvals of different clearances & consents. The state government has made some well-planned infrastructure investments for roads & railroad systems. Government offers various subsidies under Industrial Investment Promotion Assistance (IIPA) under 2014 Schemes for investment in development of road, electrification, water, industrial parks, etc. 1 From Bhopal 4

5 VISION Develop the transportation network to enhance rural connectivity Reform the institutional machinery for creating public transport facilities Skill development by expanding training infrastructure & capacity to aid 1 million youth in attaining wages & self employment Enhance the ease of doing business for the benefit of investors Attract higher investments in manufacturing, services & labour intensive sectors Make the state a world class tourist destination Promote religious, adventure & heritage tourism & attract private investment Investment promotion Tourism Transport Agriculture Vision Skill development Infrastructure Housing Improve civic infrastructure, including public & household sanitation facilities Expand availability of affordable housing Environment Promote social & agro forestry Revitalise ground water resources Private sector participation in maintaining waste disposal & water conservation Expand the outreach of agriculture technology & irrigation to remote farms. Promote farm level diversification and value addition. Connect all villages through world class highways To be a leader in renewable energy & green technology Keep the state power surplus by addition to the power generation capacity Source: Government of Madhya Pradesh 5

6 FACT FILE There are 11 agro-climatic conditions and a variety of soils available in the state to support cultivation of a wide range of crops. Parameters Capital Madhya Pradesh Bhopal Geographical area (sq km) 308,000 Administrative districts (No) 51 Population density (persons per sq km) 236 Total population (million) 72.6 Male population (million) 37.6 Female population (million) 35.0 Madhya Pradesh is located in central India. The state is surrounded by Uttar Pradesh in North, Chhattisgarh in East, Maharashtra in South, Gujarat and Rajasthan in west. Sex ratio (females per 1,000 males) 931 Literacy rate (%) 70.6 The most commonly spoken language of the state is Hindi. English and Marathi are the other languages used. Bhopal, Indore, Gwalior, Jabalpur and Ujjain are some of the key cities of the state. Source: Government of Madhya Pradesh website, National Informatics Centre Madhya Pradesh 6

7 IN FIGURES (1/2) Parameter Madhya Pradesh All states Source Economy GSDP as a percentage of all states GSDP GSDP growth rate (%) Per capita GSDP (US$) 1, NA Aranca Estimates based on Advanced Estimates provided by Directorate of Economics and Statistics of Madhya Pradesh Aranca Estimates based on Advanced Estimates provided by Directorate of Economics and Statistics of Madhya Pradesh Aranca Estimates based on Advanced Estimates provided by Directorate of Economics and Statistics of Madhya Pradesh Physical Infrastructure Installed power capacity (MW) 20, , Central Electricity Authority, as of February 2018 Wireless subscribers (No) 73,099,362 1,167,435,645 Internet subscribers (No) 21,830, ,230,000 National Highway length (km) 7, ,435 Telecom Regulatory Authority of India, as of December 2017 Telecom Regulatory Authority of India, as of September 2017 NHAI & Roads and Building Department, as of June 2017 Airports (No) Airports Authority of India 7

8 IN FIGURES (2/2) Parameter Madhya Pradesh All states Source Social Indicators Literacy rate (%) Census 2011 Birth rate (per 1,000 population) SRS Bulletin Investments FDI equity inflows (US$ billion) Department of Industrial Policy & Promotion, From April 2000 to December 2017 Industrial Infrastructure PPP projects completed & operational (No) 164 1,534 Operating SEZs (No) DEA, Ministry of Finance, Government of India, February 2018 Ministry of Commerce & Industry, Department of Commerce, December Including Chhattisgarh PPP: Public Private Partnership, SEZ: Special Economic Zone, SRS: Sample Registration System 8

9 ECONOMIC SNAPSHOT GSDP At current prices, the Gross State Domestic Product (GSDP) of Madhya Pradesh for stood at US$ billion. GSDP of Visakhapatnam Madhya Pradesh port at traffic current (million prices tonnes) (in US$ billion) Between FY12 and FY18, GSDP of the state grew at a CAGR of 8.40 per cent CAGR 8.40% Source: Ministry of Statistics and Programme Implementation 9

10 ECONOMIC SNAPSHOT NSDP The Net State Domestic Product (NSDP) of Madhya Pradesh was about US$ billion in NSDP of Visakhapatnam Madhya Pradesh port at traffic current (million prices tonnes) (in US$ billion) Between FY12 and FY18, state s NSDP grew at a CAGR of about 8.57 per cent. CAGR 8.57% Source: Ministry of Statistics and Programme Implementation 10

11 ECONOMIC SNAPSHOT PER CAPITA GSDP The state s per capita GSDP* in was US$ 1, in comparison with US$ in Per capita NSDP in the state increased at a CAGR of 6.83 per cent between FY12 and FY18. Per capita Visakhapatnam GSDP of Madhya port Pradesh traffic (million at current tonnes) prices (in US$) CAGR 6.83 % Source: Ministry of Statistics and Programme Implementation 11

12 ECONOMIC SNAPSHOT PER CAPITA NSDP The state s per capita NSDP * in was US$ 1, comparison with US$ in Per capita GSDP of the state increased at a CAGR of 7.00 per cent between FY12 and FY18. Per capita Visakhapatnam NSDP of Madhya port Pradesh traffic (million at current tonnes) prices (in US$) CAGR 7.00 % Source: Ministry of Statistics and Programme Implementation 12

13 ECONOMIC SNAPSHOT PERCENTAGE DISTRIBUTION OF GSVA In , the primary sector contributed 41.43% to the state s GSVA at current prices, followed by tertiary sector with a contribution of 38.80% & secondary sector contributing 19.77%. At a CAGR of 19.7%, the primary sector witnessed the fastest growth among the three sectors, between FY12 and FY17. The tertiary sector expanded at a CAGR of 14.7% between FY12 and FY17. Growth has been driven by trade, hotels, real estate, finance, insurance, transport, communications & other services. The secondary sector expanded at a CAGR of 7.9% between FY12 and FY17driven by manufacturing, electricity, gas & water supply & construction sectors. Visakhapatnam GVA composition port traffic by (million sector tonnes) 39.06% CAGR 38.80% 14.7% 27.09% 19.77% 7.9% 41.43% 33.85% 19.7% Primary Sector Secondary Sector Tertiary Sector Source: Ministry of Statistics and Programme Implementation 13

14 ECONOMIC SNAPSHOT AGRICULTURAL PRODUCTION (1/2) Agriculture is the main source of livelihood for the people of the Madhya Pradesh. In , the state recorded utilisation of 1, thousand hectares of land for production of horticulture crops. Wheat, soyabean, gram, sugarcane, rice, maize, cotton, rapeseed, mustard & arhar are the major crops of the state. In , total food grain production in the state stood at million metric tonnes. In , total pulses production in the state stood at around 6.25 million tonnes. Madhya Pradesh is the largest producer of pulses, oilseeds soyabean and gram in the country. The state is the 2nd highest producer of wheat, masoor & mustard across India. It is one of the leading producers of garlic & coriander. The production of wheat, cotton, baajra, corn, gram, soyabean, mustard, groundnut, paddy, jowar & corn in the state, is above the national average. Crop Annual production ( 000 MT) Wheat 17,939.3 Fruits 5, Vegetables 16, Sugarcane 4,730.0 Onion 2,256 Rice 4,226.8 Food grains 32,983.0 Spices Honey 1.87 Coarse cereals 4,567.5 Total pulses 6,249.4 US$ 1, million were allocated to farmers welfare and agriculture development in state budget Note: * 2 nd advance estimates for , US$1 = Rs for figures Source: MP State Facts Profile Department of Agriculture and Cooperation, National Horticulture Board, Aranca Research 14

15 ECONOMIC SNAPSHOT AGRICULTURAL PRODUCTION (2/2) In August 2017, the state government launched Bhavantar Bhugtan Yojana or Price Deficit Financing Scheme will hedge price risks in agriculture. Under the scheme, farmers will be compensated if they have to sell the notified crops at distressed prices which are below the Minimum Support Price (MSP) set by the Union Government. In order to overcome the drawbacks of National Agricultural insurance Scheme, a new scheme Prime Minister Crop Insurance Scheme was announced by the Prime Minister, which would be effective from As per budget , provision of US$ 310 million has been made under Prime Minister Crop Insurance Scheme for agriculture. Moreover, for agricultural soil, water conservation as well as agricultural research & education, the state government has allocated an amount of US$ million as per the budget During , US$ 1.53 billion would be sanctioned by the state government for irrigation schemes and US$ 21 million for micro irrigation in the state. Moreover, an allocation of US$ million was made by the state government for horticulture & food processing sector. Source: State Budget 15

16 * ECONOMIC SNAPSHOT FDI INFLOWS & INVESTMENTS According to the Department of Industrial Policy & Promotion (DIPP), cumulative FDI inflows*, from April 2000 to December 2017, totaled to US$ 1.39 billion. Power generation & manufacturing were the key sectors which attracted the majority share of FDI inflow during In addition, the investments in real estate & services are also gaining momentum. FDI equity Visakhapatnam inflows 1, port traffic to *(US$ (million tonnes) million) With a capital investment of US$ million Government of Madhya Pradesh approved 6 projects in January Note: * As of December 2017 Source: Department Of Industrial Policy & Promotion 1 Including Chhattisgarh 16

17 STATE BUDGET Total budgeted expenditure in is estimated to be US$ billion. Department Budget (US$ million) School Education 3, Energy 2, Rural Development 2, Farmers Welfare and Agricultural Development 1, Public Works 1, Source: State Budget

18 PHYSICAL INFRASTRUCTURE ROADS Madhya Pradesh has national highways measuring 7,854* km. The state also has 10,859 km of state highways. Development of major roads in the state is managed by Madhya Pradesh Road Development Corporation Limited (MPRDC), which executes tasks taken up under Public Private Partnership (PPP) & those supported by Asian Development Bank (ADB). As per the Department of Economic Affairs, the state had 131 government PPP projects in the roads sector at various stages of development. Under Prime Minister Graamin Sadak Yojana, 3, km of roads have been completed in the state as of February For the development of various roads in the state, allocation of US$ 1.12 billion has been proposed by the state government As per budget , provision of US$ million under Mukhyamantri Gram Sadak Yojana & that of US$ million for State Rural Road Connectivity Scheme, have been made. In February 2017, the cabinet sanctioned the renovation of 10,000 km of rural roads, under the Chief Minister's Rural Roads Scheme. Road type Road length (km) (2015) National highways 7,854* State highways 10,859 Major district roads 19,574 Village roads 24,209 Road length 59,835 As per the state budget , work on development of various district roads had started in and the renovation of these roads is expected to be completed over a span of three years. However, for this purpose, the state government is trying to secure a loan from ADB as well as new development banks. In November 2016, the New Development Bank created by BRICS countries approved a loan of US$ 350 million for the development of major district roads in the state. Source: NHAI, Ministry of Road Transport & Highways, State Budget , * - as of June

19 PHYSICAL INFRASTRUCTURE RAILWAYS Madhya Pradesh has around 4,954 km of railway lines & the state is connected to different states of the country through more than 425 trains which travel on daily basis. In June 2017, Bhopal s railway station Habibganj became the country s first railway station to be redeveloped into an attractive commercial hub with hotels, offices & shops under a public-private partnership within the next three years. The project for maintenance & operations has been given to Bansal Group for 8 years. In December 2016, Madhya Pradesh Cabinet approved the detailed project reports (DPRs) of the Metro rail projects for Bhopal & Indore, costing US$2.12 billion. In September 2017, a joint venture between DB Engineering & Consulting GmbH, Geodata Engineering S.p.A. and Louis Berger Group won the contract for these two projects. The railway network in Madhya Pradesh primarily falls under the West-Central Railways, which was formed in 2002 and is headquartered in Jabalpur. Part of the state is also covered by Central & Western Railways. Being centrally located, the railway network in the state assumes great significance. Madhya Pradesh s capital, Bhopal is one of the foremost railway junctions in the country, as 220 trains travel through the capital alone. Mineral & agro-based industries in Madhya Pradesh are highly dependent on the railway network of the state. It supports these industries by transporting bauxite, limestone, dolomite, clinker, fertilizer & de-oiled cake. Source: Maps of India 19

20 PHYSICAL INFRASTRUCTURE AIRPORTS Madhya Pradesh has 5 operating airports at Jabalpur, Bhopal, Indore, Gwalior & Khajuraho. Indore & Bhopal airports are the busiest airports in the state. During April-January 2018, passenger traffic at Indore airport reached 1,855,933 passengers with overall aircraft movement of 15,323 aircrafts. For the same period, passenger traffic at Bhopal airport was 595,712 passengers with overall aircraft movement of 5,972 aircrafts. Both Indore & Bhopal airports have strong cargo handling capacity. During April 2017-January 2018, Indore airport handled 9,082 tonnes of cargo, whereas Bhopal airport handled 966 tonnes of cargo. Modernisation work of Bhopal & Indore airports has also been completed. Airport indicators in Madhya Pradesh No. of passengers Airport * Indore 1,784,073 1,855,933 Bhopal 676, ,712 Aircraft movement Airport * Indore 14,396 15,323 Bhopal 6,949 5,972 Freight (in tonnes) Airport * Indore 7,668 9,082 Bhopal Source: Airports Authority of India, *for the period April 2017 to January

21 8,574 9,351 12,902 14,259 15,845 18,571 19,766 20,119 PHYSICAL INFRASTRUCTURE POWER (1/3) In February 2018, Madhya Pradesh had total installed power generation capacity of 20, MW, comprising 5, MW under state utilities, 5, MW under central utilities & 9, MW under the private sector. Installed power capacity (MW) Of the total installed power generation capacity, 12, MW was contributed by thermal power, 3, MW was contributed by hydropower, MW was contributed by nuclear power & renewable power contributed 3, MW. Madhya Pradesh is on its way to become a solar power hub, with 114 projects currently. As on November 2017, Madhya Pradesh have 11 Small Hydro Power Projects with the capacity of MW. The total budget allocation for the energy sector in the state is estimated to be US$ 2.75 billion during In May 2017, 2 new indigenous nuclear power reactors of 700 MW capacity each were approved by the Union Government. The reactors will be built at Chutka in Madhya Pradesh. In December 2017, foundation stone was laid for the world s largest ultra mega solar power plant at Gurh in Madhya Pradesh for an investment of Rs 4,500 crore (US$ million), which will spread across 1,600 hectares of land and generate 750 MW of electricity. Source: Central Electricity Authority Break-up of installed capacity by source of power generation ( *) 16% 19% 2% 63% Thermal Power Hydropower Renewable Power Nuclear Power Note: * - as of January 2018 Source: Central Electricity Authority; * - as of January

22 PHYSICAL INFRASTRUCTURE POWER (2/3) Madhya Pradesh Power Generating Corporation Ltd. is a state owned company engaged in electricity generation. The power distribution business is being managed through 3 government-controlled entities: Madhya Pradesh Poorv Kshetra Vidyut Vitaran Company Ltd., Madhya Pradesh Paschim Kshetra Vidyut Vitaran Company Ltd., & Madhya Pradesh Madhya Kshetra Vidyut Vitaran Company Ltd. Madhya Pradesh Power Transmission Company carries out intrastate transmission of electricity, State Transmission Utility & State Load Dispatch Centre. Madhya Pradesh Power Trading Corporation Ltd. deals with power trading & other related activities. Segment Power generation Power distribution Power transmission Power trading Company name Madhya Pradesh Power Generating Corporation Limited Madhya Pradesh Poorv Kshetra Vidyut Vitaran Company Limited (MPPoKVVCL) Madhya Pradesh Paschim Kshetra Vidyut Vitaran Company Limited (MPPaKVVCL) Madhya Pradesh Madhya Kshetra Vidyut Vitaran Company Limited (MPMaKVVCL) Madhya Pradesh Power Transmission Corporation Limited Madhya Pradesh Power Trading Corporation Limited Distributor MPPoKVVCL MPPaKVVCL MPMaKVVCL MPPoKVVCL MPPaKVVCL Area covered Jabalpur, Sagar, Shahdol and Rewa Indore and Ujjain Bhopal, Hoshangabad, Gwalior and Chambal Jabalpur, Sagar, Shahdol and Rewa Indore and Ujjain Source: Energy Department-Government Of Madhya Pradesh 22

23 PHYSICAL INFRASTRUCTURE POWER (3/3) Through the Atal Jyoti Abhiyaan, the state government aims to provide round-the-clock quality power supply. The scheme is currently operational in six districts, namely Jabalpur, Mandla, Shahdol, Umaria, Anooppur and Burhanpur. Under project name Vindhyachal, NTPC has commissioned the country s largest power generation plant in the state. Unit-13 of Vindhyachal TPP- V, with capacity of 500 MW, was commissioned in August With this the total approved capacity of 4,760 MW was installed by the company. The coal based Sasan UMPP aims to build large capacities at low cost. The resultant generated power would be sold at low tariffs. In April 2015, the 3,960 MW Sasan ultra mega power project was fully commissioned in Madhya Pradesh. The project is being developed with an investment of US$ 4.21 billion. As of April 2016, the plant had achieved 100% PLF (plant load factor). In April 2017, the state government signed a project agreement with solar power companies for Rewa Ultra Mega Solar Park. The project is being led by Rewa Ultra Mega Solar Ltd. (RUMSL), a joint venture between the Solar Energy Corporation of India (SECI) and Madhya Pradesh Urja Vikas Nigam Limited (MPUVN). International Finance Corporation (IFC), a member of the World Bank Group, will mobilise US$ 550 million in private investment for the project. 23

24 PHYSICAL INFRASTRUCTURE TELECOM According to Telecom Regulatory Authority of India (TRAI), Madhya Pradesh (including Chhattisgarh) had nearly million wireless subscribers & 0.98 million wireline subscribers, as of December As of December 2017, teledensity (telephone connections per 100 persons) in Madhya Pradesh was 69.69%. The state has been identified by Ministry of Home Affairs for provision of Telecom Connectivity in LWE affected areas. The scheme is being executed by BSNL. At the end of December 2017, 24,166,009 people have submitted requests for mobile number portability in the state. The state has given consent for establishment of BharatNet/ National Optical Fibre Network (NOFN) project. The project is planned to connect all gram panchayats through optical fibre, utilising existing fibres of PSUs viz. BSNL, RailTel & Power Grid & laying incremental fibre wherever necessary to bridge the connectivity gap between gram panchayats (GPs) and blocks, for providing broadband connectivity. Telecom infrastructure - as of December 2017 Wireless subscribers 73,099,362 Wire-line subscribers 978,193 Internet subscribers^ 21,830,000 Teledensity (in%) Some of the major telecom operators in Madhya Pradesh Bharat Sanchar Nigam Limited (BSNL) Bharti Airtel Vodafone Essar Idea Cellular Reliance Communications Tata Teleservices Note: ^ - as of September 2017 Source: Telecom Regulatory Authority of India, Department of Telecommunications, *including Chhattisgarh 24

25 DEVELOPMENT PROJECTS: URBAN INFRASTRUCTURE (1/3) Under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM), 27 projects costing around US$ million were sanctioned for the development of urban centers such as Bhopal, Indore, Jabalpur and Ujjain. Some of the key undertakings are in segments such as roads and flyovers, water supply, tempest-water drainage, sewerage, solid-waste management and mass rapid transport systems. The Asian Development Bank (ADB) has funded 16 ventures worth US$ 33.8 million for Bhopal in the regions of water supply, sewerage and sanitation, tempest-water drainage and solid-waste management. Of the 16 undertakings, two have been finished and others are at different phases of development. The state government has built the Madhya Pradesh Urban Infrastructure Fund (MPUIF) for the improvement of urban framework and the procurement of better administration in the state. MPUIF helps in sourcing funds for projects through various sources, for example capital markets, line of credits and GOI fund (e.g. JNNURM, UIDSSMT, PFDF, VGF, and RAY). The fund ensures cost administration and timely implementation of urban framework ventures. Under the Urban Infrastructure and Governance (UIG) program of JNNURM, five projects worth US$ 36.4 million covering cities such as Bhopal, Indore and Ujjain have been approved and are in the transition phase. Under the first phase of Chief Minister Infrastructure Development Scheme, work on development of roads, gardens, footpaths, street lights, etc. was completed in across 277 cities of the state during Under Swachh Bharat Mission, a total of 5,068 seats were constructed in around 145 thousand personal and public toilets of the state, as of In 2017 under Swachh Bharat Mission, Indore was declared the cleanest city whereas Bhopal was second out of approximately 500 cities. In 2015, Madhya Pradesh came up with set of programs and policies to make itself a manufacturing hub, with an aim to push for Make-in-Madhya Pradesh initiative with focus on MSMEs. In May 2017, the state government announced that it will build 2 million households over the next two years for the urban and rural poor. Each house will be built with US$ 4, in centre-state subsidy and US$ 2, in state supported financing. Source: Bhopal Municipal Corporation, NNURM, Ministry of Urban Development, Government of India 25

26 DEVELOPMENT PROJECTS: URBAN INFRASTRUCTURE (2/3) As per the budget , following announcements were made for enhancement of urban infrastructure in the state: Allocation of US$ 1.63 billion was proposed by the state government for urban administration and development in the state. For the second phase of Chief Minister Infrastructure Development Scheme, the state government proposed an allocation of US$ million. Under Affordable Housing in Partnership scheme, for each dwelling slum area, US$ 86 thousand was allocated by the central and the state government. Provided sanction for the construction of 634 community and 1,77,807 individual toilets under Mukhya Mantri Shahri Swacchata Mission. The promotion of e-governance has been started in the urban region of the state by E-Nagar Palika Project. For increasing developmental activities in the state, a sum of US$ 1.09 billion will be provided by the government to the state. By 2018, the government is also aiming to provide 5,00,000 houses in different cities of the state, and allocated US$ million under Pradhan Mantri Awas Yojna. Provided sanction for development of 60,000 houses for the urban poor by an allocation of US$ million under urban development scheme. In addition to this, a sanction of US$ million was also provided for 15,340 houses under Rajeev Awas Yojna. HDFC Bank is planning to set up 10 new branches in Madhya Pradesh as a part of its expansion plan. In 2016 the bank had 130 branches in MP, and 8-10 new branches are being planned to be opened in the state in current financial year. US$ 155 million was allocated to Housing for All scheme in urban areas and USD 1.78 billion to Urban Administration and Development. The presence of numerous prominent technical, management and other professional institutes have made Madhya Pradesh an ideal destination for startups hub. Madhya Pradesh has aligned with the Government of India s Startup India Vision by creating conducive innovative and technological entrepreneurial ecosystem through MP Incubation & Startup Policy 2016 to encourage and promote a Startup culture within the state. In the state budget of , the government allocated US$ 1.84 billion for urban development. Source: Budget , Budget

27 DEVELOPMENT PROJECTS: URBAN INFRASTRUCTURE (3/3) Focus areas of urban development in Madhya Pradesh Water supply Sewerage system Solid-waste management Others The average per capita water supply in major cities, such as Indore, is around 80 litres per day. Under the JNNURM, cities are In cities such as Indore, around 55% of the population is connected to a sewage network. Under the JNNURM, the entire Indore and Ujjain generate around 500 tonnes per day (TPD) and 160 TPD of solidwaste, respectively. Under the JNNURM, the entire Two projects worth US$ 75.6 million were sanctioned between and for improvement of the drainage systems. being planned to achieve per capita water supply of 135 litres per day between 2015 and population in the cities will be connected to the sewage network. Three projects worth US$ 100 solid waste is expected to be collected and treated. A project worth US$ 10.7 million was sanctioned. Seven projects worth around US$ million were sanctioned for improvement of the transport system. Sixty seven projects worth US$ million were approved between March 13 and March 2014 and are in the transition phase for water supply under JNNURM. million were sanctioned in for sewage treatment under JNNURM. Three solid waste management projects have been identified in Dewas, Sagar and Katni. During , the government proposed an outlay of US$ million for improving rural & urban water supply under the Water Supply and Sanitation Scheme. Source: MP Trade & Investment Facilitation Corporation Ltd., JNNURM, Ministry of Urban Development, Government of India, Aranca Research 27

28 DEVELOPMENT PROJECTS: KEY PUBLIC PRIVATE PARTNERSHIP PROJECTS (1/2) Name of project Sector PPP type Status Project cost (US$ million) Road upgradation (Lebad-Jaora) Project Build-Operate-Transfer (BOT) Transport Operation and maintenance stage Road Upgradation Project (Bankhlafata- Kogawa-Borawa-Sarvardevala) Project Road upgradation (Jaora-Nayagaon) Project Not available Transport 5.14 Operation and maintenance stage Build-Operate-Transfer (BOT) Transport Operation and maintenance stage Road Upgradation Project (Bahari- Hanumana) Project Road Upgradation (Bhopal-Dewas) Project Road Upgradation Project (Badwani- Palsood-Sendhawa) Project Road Upgradation Project (Ashok Nagar- Vidisha) Project Design-Build-Finance- Operate-Transfer (DBFOT) Design-Build-Finance- Operate-Transfer (DBFOT) Design-Build-Finance- Operate-Transfer (DBFOT) Build-Operate-Transfer (BOT) Annuity Transport Operation and maintenance stage Transport Operation and maintenance stage Transport Operation and maintenance stage Transport Operation and maintenance stage Electricity Distribution Project (Ujjain) Not available Energy Operation and maintenance stage Road Upgradation Project (Ashapur- Khalwa-Singhot) Project Build-Operate-Transfer Annuity Transport Operation and maintenance stage Dewas-Ujjain-Badnagar-Badnawar Road Project Build-Operate-Transfer (BOT) Transport 7.53 Operation and maintenance stage Road Upgradation Project (Alirajpur- Jobat) Project Build-Operate-Transfer (BOT) Annuity Transport 6.92 Operation and maintenance stage Source: Department of Economic Affairs 28

29 DEVELOPMENT PROJECTS: KEY PUBLIC PRIVATE PARTNERSHIP PROJECTS (2/2) Name of project Sector PPP type Status Project cost (US$ million) Road Upgradation Project (Waraseoni- Lalbarra) Project Road Upgradation (Tyonda-Ganjbasoda) Project Road Upgradation Project (Umari-Phoop- Pratapur) Project Road Upgradation Project (Ujjain-Unhel- Nagda-Ghiloda) Project Road Upgradation Project (Ujjain- Simhastha) Project Road Upgradation (Gwalior-Bhind up to UP Border) Project Road Upgradation Project (Uchera- Nagod-Singhpur-Kalinnjer Road) Project Road Upgradation (Sheopur-Badora- Khawajapur) Project Road Upgradation Project (Tikamgarh- Mehironi) Project Road Upgradation (Dehgaon-Bamori) Project Road Upgradation Project (Tikamgarh- Jatara-Palera-Nowgaon) Project Design-Build-Finance- Operate-Transfer (DBFOT) Build-Operate-Transfer (BOT) Annuity Design-Build-Finance- Operate-Transfer (DBFOT) Design-Build-Finance- Operate-Transfer (DBFOT) Build-Operate-Transfer (BOT) Annuity Transport 6.50 Operation and maintenance stage Transport Operation and maintenance stage Transport Operation and maintenance stage Transport Operation and maintenance stage Transport Operation and maintenance stage Build-Operate-Transfer (BOT) Transport Operation and maintenance stage Design-Build-Finance- Operate-Transfer (DBFOT) Build-Operate-Transfer (BOT) Annuity Design-Build-Finance- Operate-Transfer (DBFOT) Build-Operate-Transfer (BOT) Annuity Design-Build-Finance- Operate-Transfer (DBFOT) Transport Operation and maintenance stage Transport 9.45 Operation and maintenance stage Transport 4.49 Operation and maintenance stage Transport 5.51 Operation and maintenance stage Transport Operation and maintenance stage Source: Department of Economic Affairs 29

30 DEVELOPMENT PROJECTS: SPECIAL ECONOMIC ZONES (SEZs) (1/2) The state has one operational SEZ with the name Crystal IT Park SEZ for IT & ITeS enabled services. The SEZ aims to provide an international, competitive and hasslefree environment for export-oriented production. It is exempted from custom duty on import of capital goods, raw material and spares, among others. No licence is required for imports. Central excise duty is exempted on procurement of capital goods, raw material and spares among others from the domestic market. Barring a few sectors, 100% FDI in the manufacturing sector is allowed through the automatic route. Indore SEZ Notified area 1, hectares Processing zone hectare Operational 26 industrial and 2 trading units Number of allotments 123 Number of units operating 42 Investment under implementation US$ 62.2 million (9 units) Exports (as of June 2017) US$ million Some of the key companies in Indore SEZ SRF Flexituff India Nets New Tech Pipes Advance Enzyme Technology Ipca Laboratories Amulya Exports Emerald Tobacco Pratibha Synte Source: Ministry of Commerce & Industry 30

31 DEVELOPMENT PROJECTS: SPECIAL ECONOMIC ZONES (SEZs) (2/2) As of December 2017, the state had 10 formal approved SEZs that are proposed to be set up in Madhya Pradesh. Bhopal, Indore, Gwalior and Jabalpur are the major locations where SEZs have been approved. These SEZs have been proposed for IT/ITeS, mineral-based, agro-based and multi-products. Industry Location No of SEZs Formally approved SEZs as of December 2017 IT/ITeS Indore, Gwalior, Jabalpur, Bhopal Gems and Jewellery Indore 1 8 Multi Product Chhindwara 1 Notified SEZs as of December 2017 IT/ITeS Indore, Gwalior 5 Source: Special Economic Zones in India- Ministry of Commerce & Industry, Aranca Research 31

32 SOCIAL INFRASTRUCTURE EDUCATION.. (1/2) Madhya Pradesh had a literacy rate of 70.6%; the male literacy rate is 80.5% and the female literacy rate is 60.0%. During (till November 2015), under technical education, the state had a total of 676 institutions with annual enrolment of 146 thousand students. Moreover, under the Gaon Ki Beti Yojna, which deals in providing rural girls with high education, thousand girls were benefited during (till December 2015). Make in Madhya Pradesh is to further the agenda of CM who recently called upon a business community from the US to bring their expertise in the social sectors. Reputed institutes of Madhya Pradesh Indian Institute of Management (IIM), Indore Indian Institute of Forest Management, Bhopal Institute of Hotel Management, Bhopal International Institute of Professional Studies, Indore Indian Institute of Technology (IIT), Indore Category Literacy rate (%) Total 70.6 Male 80.5 Female 60.0 Educational institutions (as of ) Primary schools 83,983 Total high schools (including private) 4,774 Total higher secondary schools (including private) 5,211 # Government colleges 457 Universities 16 # Polytechnic institutes 69 Engineering & architecture colleges 232 Management institutes 266 # Medical colleges 13 # Dental Colleges 11 # Note: # Figures as of April 2015 Source: AICTE, Directorate of Technical Education, Madhya Pradesh, Higher Education Department- Government colleges of Madhya Pradesh, Madhya Pradesh Education Portal, National Health Portal, Aranca Research 32

33 SOCIAL INFRASTRUCTURE EDUCATION.. (2/2) The state has one approved institute with foreign collaboration for the course of business studies. The name of the institute is Daly College Business School and is affiliated to De Montfort University, Leicester, UK. As per the budget , the government proposed an allocation of US$ 3, million & US$ million for the development of school education & higher education in the state. Under Rashtriya Madhyamik Shiksha Abhiyan, allocation of US$ million was proposed by the state government during During , the state government is targeting upgradation of 520 high schools & 240 higher secondary schools. The Government of Madhya Pradesh has committed US$ million, for expansion of training infrastructure & building capacity for skill development in the state in January 2017 The scheme will be implemented over a period of 5 years & aims to generate employment for youth & provide desired skillset & manpower to the industries. In the budget , the government proposed an allocation of US$ million under skill development scheme (Asian Development Bank projects). In May 2017, the state government had decided to teach engineering in Hindi from the new academic session. The students will be asked to choose between English and Hindi medium of study during admission to engineering courses. Source: AICTE 33

34 SOCIAL INFRASTRUCTURE HEALTH As of February 2018, the healthcare services network of Madhya Pradesh comprised 52 district hospitals, 394 community health centres, 1,435 primary health centres and 11,618 sub-health centres. During (till October 2015), around 965 thousand beneficiaries were benefited with free services under Deendayal Hospital Yojana. The state has a total of 604 ambulances under National Ambulance Service, using which 479 thousand patients were benefited during April-October Health indicators of Madhya Pradesh Birth rate Death rate Infant mortality rate 2 47 Life expectancy at birth (years) Male ( ) 64.5 Female ( ) 65.3 Health institutions (February 2018) District hospitals 52 Primary health centres 1,435 Sub-Health centres 11,618 Community health centres 394 Civil hospitals* 66 Homeopathic hospitals* 2 Special newborn care units* 53 Nutrition rehabilitation centres* 316 Gram aarogya kendras* 48,959 The state government proposed an allocation of US$ million for the development of Public Health And Family Welfare Department in the state, during Under Public Health Engineering, an allocation of US$ million was made by the state government, as per the State Budget Note: * as of March 2017 Source: Ministry of Health & Family Welfare, Government of India, Sample Registration System (SRS) Bulletin, 1 Per thousand persons, 2 Per thousand live births 34

35 CULTURAL INFRASTRUCTURE Madhya Pradesh s history dates back to the pre-historic age. The United Nations Educational, Scientific and Cultural Organisation (UNESCO) has declared 3 locations in the state as heritage sites: temples at Khajuraho, Buddhist monuments at Sanchi & rock shelters of Bhimbetka. Bhimbetka cave paintings are the biggest repository of prehistoric art in India. Sanchi Stupa, once a centre of Buddhist learning, stands unique as one of the most well-preserved stupas of India. The Directorate of Archaeology, Archives and Museums, is in charge of the support of 349 memorials/landmarks and 44 museums over the state. The state government has built up sports academies to advance games like hockey, shooting, equestrian, water sports & martial arts. Eminent sports personalities are awarded with the Vikram Awards, the Ekalavya Awards & the Vishwamitra (lifetime achievement) Award. In order to enhance the cultural infrastructure in the state, the Government of Madhya Pradesh had allocated US$ million during For sports & youth welfare in the state, an allocation of US$ million was proposed by the Government of Madhya Pradesh, as per state budget Among the cultural festivals of Madhya Pradesh, the Khajuraho Festival of Dance & the Tansen Music Festival in Gwalior celebrate classical Indian dance & music. These festivals are well attended by both domestic & international tourists. The state government will also provide an amount of US$ million in the state budget of in order to increase the activities related to culture. Type of museum (no) State-level museums 6 District-level museums 12 Local museums 7 Site museums 6 District Archaeological Association museums State-level museums in Madhya Pradesh State Museum, Bhopal Central Museum, Indore Rani Durgawati Museum, Jabalpur Tulsi Museum, Ramvan, Satna Maharaja Chhatrasal Museum, Chhatarpur Gujri Mahal Museum, Gwalior 16 Source: Directorate of Archaeology, Archives and Museums, Government of Madhya Pradesh; State Budget

36 INDUSTRIAL INFRASTRUCTURE (1/4) Madhya Pradesh State Industrial Development Corporation Limited (MPSIDC) is the nodal agency for industrial growth in the state. It is the central point to coordinate, activate and ensure implementation of mega infrastructure projects. MPSIDC has identified 19 industrial growth centres to attract medium and large industries & Non-Resident Indians (NRls) to the state and provide various facilities and concessions to them. For a balanced & sustainable growth of industry across the state, MPSIDC established 7 growth centres at Bhopal, Gwalior, Jabalpur, Indore, Rewa, Ujjain & Sagar. These growth centres are known as Madhya Pradesh Audyogik Kendra Vikas Nigam Limited (AKVN). Infrastructure Bhopal AKVN Gwalior AKVN Jabalpur AKVN Area developed (hectares) 1,367 2,062 1,312 Growth centres Mandideep, Pillukhedi Malanpur, Ghirongi, Banmore, Chainpura Borgaon, Maneri Units established Large and medium industries (LMI): 54 Small scale industries (SSI): 558 LMI: 69 SSI: 346 LMI: 17 SSI: 154 Major companies HEG, Crompton Greaves, Procter & Gamble, Godrej, Lupin, Oswal, Vardhman Surya Roshini, Godrej, Grasim, Cadbury, JK, Crompton Greaves Raymond, Hindustan Petroleum, Ayur Special infrastructure Inland Container Depot (ICD), Food Park ICD, food park, stone park Stone park, food park, mineral & Agri specific SEZ Proposed project Engineering cluster, logistic hub, food park, plastic park, textile park Readymade garment park, food park Agri SEZ, food park, textile park, apparel park Source: MP Trade & Investment Facilitation Corp. Ltd. 36

37 INDUSTRIAL INFRASTRUCTURE (2/4) Infrastructure Indore AKVN Rewa AKVN Ujjain AKVN Sagar AKVN Area developed (hectares) 3, Growth centres Pithampur, Kheda, Megh Nagar Rewa, Waidhan, Purena Dewas, Maxi Purena, Sidhgawa, Pratappura Units established LMI:272, SSI: 1213 LMI: 8, SSI: 99 LMI: 35, SSI: 171 LMI: 9; SSI: 199 Major companies Eicher, Bridgestone, Hindustan Motors, Man Force, Flexituff, Kinetic, Cummins Birla, Jaypee Ranbaxy, S.Kumars, Gajra, Kirloskar, Tata Ghadi Detergent, RSPL (Rohit Surfactant), Sanmati Foods Special infrastructure Multi-product SEZ, IT SEZ, Food Park, Apparel Park, Inland Container Depot (ICD), IIDC IIDC Food park, IIDC IIDC Proposed projects Auto testing track, food park, pharma, namkeen park, logistics park Industrial area Knowledge city, new industrial area under the Delhi Mumbai Industrial Corridor project Industrial Area Source: MP Trade & Investment Facilitation Corp. Ltd., SEZ: Special Economic Zone 37

38 INDUSTRIAL INFRASTRUCTURE (3/4) The Industrial Promotion Policy 2010 aims to upgrade industrial infrastructure & provide land to investment projects without difficulties. Under the provision of Madhya Pradesh Investment Facilitation Act 2008, the state government is keen to strengthen its single-window system to attract investments. For a structured growth, the government has divided the state into 6 clusters: Indore, Bhopal, Jabalpur, Gwalior, Rewa & Sagar. The state has excellent infrastructure, with 19 industrial development parks, 129 industrial areas, 6 food parks, 8 integrated development centres, 3 dry parks, 1 stone park, 1 IT park, 1 SEZ & an apparel park at Indore. A gems & jewellery park is being developed in Indore to promote the diamond industry in the state. The government plans to develop the project on its own, after failed attempts to find a suitable partner on PPP basis. State owned NTPC plans to construct a 2,640 MW power plant in Barethi in Chattarpur district of Madhya Pradesh at a cost of US$ 3 billion. The Expert Appraisal Committee (EAC) of Union Environment Ministry has sought additional information with respect to clearance from National Board for Wildlife.* Under the Centre s Plastic Park Scheme, Industries & Commerce Department is developing plastic parks at an estimated cost of US$ million at Tamot in Raisen and Billoa district, Gwalior. Potential clusters Indore Bhopal Jabalpur Gwalior Rewa Sagar Pharmaceutical, textile, food processing, IT, auto components Engineering, textile, biotech, herbal, IT, food processing Garment, mineral, stone, forest, herbal, food processing Electronics, IT, FMCG, engineering, stone, food processing Mineral, cement, forest produce Mineral processing, stone Notes: * - As of February 2018, the project is still awaiting clearance. Source: MP Facilitation Centre for NRI, Indore Special Economic Zone, Aranca Research, SEZ: Special Economic Zone 38

39 INDUSTRIAL INFRASTRUCTURE (4/4) Industrial clusters in Madhya Pradesh Gwalior Bhopal Rewa Jabalpur Indore Sagar Source: Maps of India, Madhya Pradesh State Industrial Development Corporation 39

40 SMART CITIES As of March 2017,Madhya Pradesh was the first state to get 3 cities shortlisted to be developed according to the smart cities parameters for making them citizen friendly and sustainable. In an effort to revolutionise the infrastructure of the state, the state government decided to revamp 7 cities of Madhya Pradesh, namely Bhopal, Indore, Gwalior, Ujjain, Jabalpur, Sagar & Satna. Gwalior Smart cities in Madhya Pradesh Cities Population Literacy rate Satna Bhopal 2,371, % Indore 3,276, % Gwalior 2,032, % Ujjain 1,986, % Ujjain Indore Bhopal Sagar Jabalpur Jabalpur 2,463, % Sagar 2,378, % Satna 2,228, % Source: News Article, Census 2011 & Aranca Research 40

41 KEY INDUSTRIES.. (1/2) Wealth of natural assets including agro-based items, forest products & minerals, the state s policy incentives & its central location have pulled in significant investments in the agro-products, consumer goods, medications & pharmaceuticals, mines & minerals, manufacturing & textiles sectors. The state government is keen to develop a strong mechanical base. The Madhya Pradesh State Industrial Development Corporation Limited (MPSIDC) & its subsidiary, Madhya Pradesh Audyogik Kendra Vikas Nigam Limited (MPAKVN) are the key nodal offices for development in the state. Some of the major industrial areas in the state are Bhopal, Sehore, Raisen, Harda, Mandideep, Dewas, Pithampur, Khandwa, Jhabua, Dhar, Ujjain, Mandsaur, Ratlam, Jabalpur, Indore, Shajapur, Satna & Gwalior. Under Industrial Promotion Policy 2010, the government aims to promote agro-based & local natural resource-based industries. Year IEMs filed Proposed investments (in US$ billion) The government approved a coated fabric manufacturing plant which was set up by Mayur Uniquoters Ltd. at Seetapur in Morena, worth US$ million of investment, in January The government in January 2017, approved a furniture fittings & manufacturing unit in Pithampur by Hettich India Pvt. Ltd., with an investment of US$ million. The number of IEMs filed in 2017 stood at 76 with proposed investments worth US$ 1.11 billion. Tertiary sector was the largest contributor to the state economy with a share of 38.8% of GSDP in Source: Madhya Pradesh State Portal, DIPP 41

42 KEY INDUSTRIES.. (2/2) In the state budget , for the rural industries, Government of Madhya Pradesh had allocated an amount of US$ million. Further, the work on installation of 25 industrial units over 2,344 hectare land is under process. However, work on 6 industrial units along with Crystal IT park, readymade garment park, etc. over an area of 295 hectares was completed during After the validation of various self employment schemes in the state, the government decided to start the Mukhya Mantri Yuva Udhyami Yojana & Mukhya Mantri Aarthik Kalyan Yojana. Work on construction of IT parks in 4 major regions of the state, including Indore, Gwalior, Bhopal & Jabalpur, was initiated during Moreover, electronic manufacturing clusters are also being established in Jabalpur & Bhopal. For these new establishments, the Government of Madhya Pradesh allocated an amount of US$ 9 million as per the Budget With an investment of US$ 2.97 billion, as of January 2017, Aditya Birla Group is expanding its business in Madhya Pradesh, in sectors like cement, retail & telecom. Key industries in Madhya Pradesh Auto and auto components Textile Cement Agro-based industries Forest based industries Pharmaceuticals Mineral based industries Manufacturing Tourism IT and ITeS Logistics & warehousing Biotechnology In budget, the state government allocated US$ million for New & Renewable Energy. Source: Madhya Pradesh State Portal, State Budget 42

43 KEY INDUSTRIES AUTO AND AUTO COMPONENTS (1/2) Strategic location of the state, with its proximity to the automotive hub of NCR, provide key advantages for well-connected regions of Madhya Pradesh to emerge as auto clusters. Supported by facilities such as an auto testing track & auto research centre, Pithampur region has emerged as a major auto cluster. The essential infrastructure foundation existing in the automotive cluster includes power, water supply, telecommunication services & roads. Some key players Eicher Motors Ltd Force Motors Ltd Hindustan Motors Ltd Mahindra Two Wheelers Ltd The Pithampur automotive cluster is among the industrial clusters in India, which have been identified by the central government for implementation of the Industrial Infrastructure Upgradation Scheme (IIUS). The scheme aims at improving the competitiveness of functional clusters across the country. It has numerous automotive original equipment manufacturers (OEMs), such as Force Motors, Eicher Motors, Hindustan Motors & Mahindra 2-Wheelers, a major tyre producing unit of Bridgestone & about 30 auto component & ancillary units. 43

44 KEY INDUSTRIES AUTO AND AUTO COMPONENTS (2/2) Eicher Motors Ltd Eicher Motors Limited, incorporated in 1982, is the flagship company of the Eicher Group in India and a leading player in the Indian automobile industry. VE Commercial Vehicles Ltd (VECV), is a 50:50 joint venture between the Volvo Group (Volvo) and Eicher Motors Limited (EML). The company has a state-of-the-art manufacturing facility of buses and trucks at Pithampur with a production capacity of 48,000 vehicles, annually and an auto component facility at Dewas (plant area of approximately 18,000 sq. m.). VECV is setting up a new engine plant in the existing facility at Pithampur. The engine capacity was ramped up from 60,000 units to 160,000 units in the financial year The company recorded revenues of US$ million, in Q3 FY18. Force Motors Ltd Force Motors is a vertically integrated automobile company, which designs, manufactures & markets its range of vehicles tractors, 3-wheelers, light commercial vehicles, multi-utility vehicles & heavy commercial vehicles. The manufacturing plant at Pithampur was set up in 1987 under license from Daimler-Benz to manufacture utility vehicles. The plant was further expanded in Subsequently, it also obtained ISO 9001:2000 certification in The total revenues recorded by the company stood at US$ million in Q3 FY18. Hindustan Motors Ltd Hindustan Motors Limited (HML), the pioneer in automobile manufacturing in India, is the flagship company of the C. K. Birla Group. The company manufactures passenger cars, multi-utility vehicles & Road-Trusted Vehicles (RTV). In technical collaboration with Australian OKA Motor Company, HML manufactures RTVs in its plant at Pithampur. The company s total income stood at US$ 0.33 million in Mahindra Two Wheelers Ltd Mahindra 2-Wheelers Limited was founded in 2008 when Mahindra & Mahindra Limited (M&M), India's leading automotive companies took over Pune-based Kinetic Motor Company Limited (KMCL). The company has a stateof-the-art, ISO 9001 certified manufacturing facility at Pithampur in Madhya Pradesh. 44

45 KEY INDUSTRIES TEXTILES (1/3) Madhya Pradesh is one of the major cotton producing states of India. In *, cotton was grown on an estimated area of 599,000 hectares in the state with a total production of around 2.10 million bales (170 kg each). Cotton textile mills are based in Indore, Dewas, Ujjain, Malanpur, Pithampur, Khargone, Gwalior & Bhopal. An apparel park is located in the Indore SEZ & spreads over acres of land. The project is implemented by M.P. Audyogik Kendra Vikas Nigam (Indore) Ltd. Indore has been identified as the region for infrastructure development under the Textiles Centre Infrastructure Development Scheme (TCIDS). The city is a cluster of the readymade garments industry with over 1,260 garment units. Extending support to the industry, the state government has announced plans to upgrade existing apparel clusters at Indore & Jabalpur. The state government has established a textile park in Chhindwara. The central government plans to develop a second textile park at Indore, and US$ 6.6 million would be sanctioned for this purpose. Textile Research Association and Export Promotion Council are to be set up in Madhya Pradesh. Trident Group is going to set up a mega industrial textile hub at Budhni in the state. Setting up of the textile hub will entail an investment of Rs 6,250 crore (US$ million) and generate employment for 16,500 persons. Textile infrastructure in Madhya Pradesh Composite mills 20 Exclusive weaving units 8 Export oriented spinning units 12 Handlooms 47,000 Looms 6,500 Power looms 43,290 Power loom units 17,524 Rotors 14,348 Spindles 1,414,000 Spinning units 40 Some key players Century Textiles and Industries Ltd Grasim Industries Ltd Vardhman Textiles Ltd Raymond Ltd Note: *provisional Source: Madhya Pradesh Business Line, Public-Private Partnerships in India, Madhya Pradesh State Industrial Development Corporation 45

46 KEY INDUSTRIES TEXTILES (2/3) To attract investments into the sector, the government has provided an interest subsidy for 5 years at a rate of 5% for textile projects and 7% for composite textile projects without capping. Furthermore, the government provided 100% assistance in plant & machinery for 8 years under Industrial Investment Promotion Assistance Scheme. Cotton production (in million bales) in Madhya Pradesh Under the Comprehensive Handloom Development Scheme (CHDS) & National Handloom Development Programme Scheme (NHDP), the financial assistance released in the last 3 years i.e to & the current year in the state stood at US$ 0.07 million. For the year , the state recorded 97 MT of total raw silk production. There were 658 weavers covered under the Handloom Weavers Comprehensive Welfare Scheme in In January 2017, the government approved a textile project to Vardhman Textile Ltd., at Mandideep, Sallapur & Budhni for modernisation & expansion, with an estimated investment of US$ million. An expansion project was granted to Sagar Manufacturing Pvt. Ltd. at Tamot, with investment worth US$ million in January FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 Cotton productivity (in kgs/hectare) in Madhya Pradesh In January 2017, the Defence Ministry announced its plans to set up a unit of national importance at Morena, with investment worth US$ million. The cotton production in Madhya Pradesh incresed from 1.5 million bales in FY10 to 2.5 million bales in FY17. FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15* FY16* Note: *provisional Source: The Cotton Corporation of India Ltd, 1 Projected, As per Cotton Advisory Board 46

47 KEY INDUSTRIES TEXTILES (3/3) Century Textiles and Industries Ltd Century Textiles and Industries Ltd was incorporated in The company has interests in textile, rayon, cement and paper. Yarn and denim production units of the textile business are located at Satrati in Madhya Pradesh. The plant is equipped with 24,960 spindles for manufacturing of yarn and produced about 4,244.2 tonnes of yarn during The denim division has a production capacity of 21 million metres of denim fabrics per annum. The company recorded revenues of US$ million in Q3 FY18. Grasim Industries Ltd Grasim Industries Ltd, a flagship company of the Aditya Birla Group, is one of the leading companies in India with diverse interests in cement, chemicals and textiles. Its textile plants are located at Bhiwani, Haryana and Malanpur, Madhya Pradesh. The Malanpur unit of the company manufactures worsted dyed yarn spun from pure merino wool along with polyester and other blends. The company has a wide retail network and also serves international apparel manufacturers. The total revenue earned by the company during Q3 FY18 stood at US$ million. Vardhman Textiles Ltd The Vardhman Group is a leading textile conglomerate in India having a turnover of US$ 1.1 Billion. The yarn manufacturing units are located in Mandideep (130,994 spindles), Satlapur (222,624 spindles) and Bhudhni (60,000 spindles). In September 2013, the company added 36,288 spindles to its Satlapur plant. Furthermore, the Bhudhni plant has a fabric weaving unit (400 looms) and a fabric processing unit with a capacity of 40 million metres per annum. The company posted total revenues of US$ million, Q3 FY18. Raymond Ltd Raymond is a major fabric manufacturer in India. Besides, the company also has business interests in engineering and aviation. The company is one of the largest integrated manufacturers of worsted fabric in the world and commands over 60.0% market share in worsted suiting in India. The total production capacity of the company is around 38 million metres of wool and wool-blended products. One of the four plants of the company is located at Chhindwara in Madhya Pradesh. The revenue earned by the company stood at US$ million, during Q3 FY18. 47

48 KEY INDUSTRIES CEMENT (1/2) The state is the 3rd largest producer of cement in the country & provides up to 13% of national demand. Being rich in limestone & coal reserves, the state represents significant opportunities for the growth of the cement industry. Satna, Jawad and Neemuch of Madhya Pradesh feature among the seven major limestone clusters in India. These clusters provide easy access to raw material resources for the cement industry. Some of the key players Birla Corporation Ltd ACC Limited Jaiprakash Associates Ltd. Heidelberg Cement India Ltd Cement Corporation of India Ltd. Most limestone deposits are concentrated in the districts of Damoh, Dhar, Neemuch, Sheopur, Rewa, Satna & Sidhi. Total cement grade limestone resources of the state are estimated at 4,326.3 million tonnes. As of 2015, Madhya Pradesh had 13 cement plants, namely Birla Vikas & Satna Cement Works (1), Cement Corporation of India Ltd. (2), Century Cement (1), Heidelberg Cement India Ltd (1), Jaypee Cement (4), K.J.S. Cement (1), Kymore Cement Works (1), Prism Cement Ltd (1) & Ultratech- Vikram Cement Works (1). UltraTech Cement Ltd. has recently bought 2 cement plants & related power assets of Jaiprakash Associates Ltd. in Madhya Pradesh, for US$ million. Source: Cement Information System (CIS)- Department of Industrial Policy & Promotion, Government of India; Cement Manufacturers Association, Aranca Research 48

49 KEY INDUSTRIES CEMENT (2/2) Birla Corp Ltd Birla Corporation Limited is the flagship company of the M P Birla Group with business interests in cement, jute goods, polyvinyl chloride floor covering, auto trim parts and iron & steel casting. The cement plant of the company is located in Satna, Madhya Pradesh. The plant has a capacity of 2.2 million tonnes per annum. In October 2013, the company announced plans to set up 3 grinding cum blending units in Madhya Pradesh. The company recently bought 2 cement plants & related power assets of Jaiprakash Associates. The total revenue recorded by the company during Q3 FY18 was US$ million. ACC Ltd ACC Limited is one of the largest cement manufacturers in India with 17 cement plants, more than 40 ready-mix concrete plants, 21 sales offices and over 9,000 dealers. In Madhya Pradesh, it has plants in Kymore with a capacity of 2.7 million tonnes per annum (MTPA). For Q3 FY18, the company recorded total revenues of US$ million. Everest Industries Ltd Everest Industries Limited manufactures a range of building solutions, which include ceilings, walls, flooring, cladding, doors, roofing and pre-engineered steel buildings. One of the five manufacturing facilities of the company is located at Kymore in Madhya Pradesh. It is among the first manufacturers of fibre-cement roofing sheets and accessories in India. The plant has been awarded by the state government for excellence in the fields of safety, health and environment. The company recorded a revenue of US$ million, during Q3 FY18. Heidelberg Cement India Ltd Heidelberg Cement India Ltd is a subsidiary of Cementrum I.B.V. (a company incorporated under the laws of The Netherlands, which is 100% controlled by HeidelbergCement AG, which is one of the largest cement manufacturers in the world). The company has two cement plants at Damoh in Madhya Pradesh. Its cement is sold under brand name Mycem. The company recorded a revenue of US$ million, during Q3 FY18. 49

50 KEY INDUSTRIES PHARMACEUTICAL AND BIOTECHNOLOGY INDUSTRY... (1/2) Madhya Pradesh has a rich bio-diversity. About 25.2% of the state is under forest cover; 11 of the 25 agro-climatic zones are present in the state and a large variety of rare and valuable medicinal and herbal plants are available. A nodal agency has been constituted to oversee the developments of the sector. Incentives in the form of capital subsidies and training assistance have been arranged to encourage investment. Biotechnology & pharmaceuticals have been recognised as thrust sectors. The state has formulated a Biotechnology Policy, which has created a conducive environment for the bio-pharmaceutical industry in the state. Bio Technology Park (Indore) and Bio Fuel Park (Rewa) are major infrastructure facilities operational in the state. Agricultural research on hybrid varieties and clinical trials are among the key activities being undertaken by the state. Some of the key players Ipca Industries Lupin Ltd Piramal Healthcare Ltd Sun Pharmaceutical Industries Ltd Teva In , the government sanctioned 2,000 new health centres in the state. The government has also proposed to spend US$ 310 million under the Rashtriya Swasthya Mission. An amount of US$ 150 million is proposed to be spent on construction of smart medical city near Sanchi. In January 2018, a non-financial, tripartite Memorandum of Understanding (MoU) was signed between Godrej Consumer Products Limited (GCPL) and the Department of Public Health and Family Welfare, Government of Madhya Pradesh and Family Health India (FHI), a local affiliate of FHI 360 (a US-based NGO), aimed at achieving Malaria free Madhya Pradesh. Source: MP Trade & Investment Facilitation Corp Ltd, Aranca Research 50

51 KEY INDUSTRIES PHARMACEUTICAL AND BIOTECHNOLOGY INDUSTRY... (2/2) Ipca Laboratories Ltd Ipca is a fully integrated Indian pharmaceutical company with a strong thrust on exports. The company has operations in over 110 countries and exports account for around 60.0% of the sales. The company has 6 Active Pharmaceutical Ingredient (API) manufacturing plants & 7 formulation plants in India. In Madhya Pradesh, it has plants at Indore, Pithampur & Ratlam. The plants manufacture drug intermediaries, oral solids, liquids & injectables, etc. & are certified by apex global agencies. During Q3 FY18, total income of the company reached US$ million. Lupin Ltd Lupin Ltd is an innovation-led pharmaceutical company producing a wide range of generic & branded formulations and Active Pharmaceutical Ingredients (APIs). The company has 2 plants in Madhya Pradesh 1 at Indore for formulations & another at Mandideep for API. The plant at Mandideep is approved by global authorities such as World Health Organisation (WHO), United States Food and Drug Administration (USFDA) & United Kingdom Medicine & Healthcare products Regulatory Agency (UKMHRA). The total revenue recorded by the company during Q3 FY18 stood at US$ million. Piramal Healthcare Ltd Piramal Healthcare Ltd (PHL) is a globally integrated healthcare company and recorded revenues of US$ million, during Q3 FY18. The company caters to a large range of therapeutic products under a number of divisions such as acute care, biotech, cardiac, diabetes, general medicine, orthopaedic, pain management, etc. The company has 6 manufacturing facilities in India, one of which is located at Pithampur in Madhya Pradesh. Sun Pharmaceutical Industries Ltd Sun Pharmaceutical Industries Ltd, one of India's largest pharmaceutical companies, is an integrated, researchbased pharmaceutical company with a global presence. In the third quarter of FY 2018, the company recorded total income of around US$ million. The company announced the acquisition of Ranbaxy Laboratories Limited in April 2014, and completed the acquisition deal in March The company manufactures a wide range of generic medicines in its 45 manufacturing sites across the globe. Sun Pharma Industries Ltd. has two manufacturing facilities in Madhya Pradesh at Dewas & Malanpur. 51

52 KEY INDUSTRIES MANUFACTURING (1/2) Madhya Pradesh State Industrial Development Corporation & its subsidiaries have developed numerous growth centres across the state. The Industrial Policy of the state provides numerous incentives for setting up manufacturing units. The manufacturing sector in Madhya Pradesh is witnessing strong growth on account of improving industrial infrastructure, policy incentives, labour resources & central location of the state. Districts such as Indore, Bhopal, Jabalpur, Ujjain, Gwalior, Dhar, Satna, Dewas, Sagar & Khandwa are notable manufacturing hubs in Madhya Pradesh. Between FY12 and FY17, gross value added originating from the manufacturing sub-sector grew at a CAGR of 6.2%. Some of the key players Bharat Heavy Electricals Ltd Kirloskar Brothers Ltd Kores (India) Ltd Crompton Greaves Birla Corporation Gross value added originating from manufacturing sub-sector at constant prices (US$ billion) For industrial modernisation, the state has undertaken measures such as introduction of Progressive Industrial Policy, infrastructure improvements & frequent investor meets. To facilitate the industry with modern infrastructure, the state has initiated expansion of existing IT parks, stone parks, apparel parks & SEZs Source: Aranca Estimates based on Advanced Estimates provided by Directorate of Economics and Statistics of Madhya Pradesh, 52

53 KEY INDUSTRIES MANUFACTURING (2/2) Bharat Heavy Electricals Ltd Bharat Heavy Electricals Ltd (BHEL) is a large engineering & manufacturing enterprise in India in the energyrelated & infrastructure sector. During Q3 FY18, the state recorded total income of US$ 1.04 billion. The Bhopal unit of BHEL was set up in Piplani in 1956 with technical assistance from Associated Electricals (India) Limited, a UK-based company. The unit has the capability to manufacture hydro, steam, marine, nuclear turbines, heat exchangers, hydro, turbo generators, transformers, switchgears, control gears, transportation equipment, capacitors, bushings, electrical motors, rectifiers, oil drilling rig equipments & diesel generating sets. Kirloskar Brothers Ltd Kirloskar Brothers Ltd (KBL) is the flagship company of the Kirloskar Group. KBL has business interests in large infrastructure projects such as water supply, power generation & irrigation, manufacturing of pumps for domestic, agricultural & industrial use. The revenue from operations of the company stood at US$ million in & US$ million during Q3 FY18. The company has 6 manufacturing plants, one of which at Dewas in Madhya Pradesh was established in The plant manufactures pumps for domestic & agricultural use. Kores (I) Ltd Kores (India) Ltd was incorporated in 1936 & has business interest in diverse fields such as office products, foundry, textiles, pharmaceuticals, engineering, etc. The engineering division of the company has a plant at Pithampur in Madhya Pradesh. The plant is set up on an area of 71,192 sq m & has facilities such as machining, fabrication, assembly & testing. The company produces hydrostatic rigs, pumps, drills & related accessories in the plant at Pithampur. Crompton Greaves Crompton Greaves is a part of the US$ 4 billion Avantha Group. The company is engaged in designing, manufacturing & marketing of technologically advanced electrical products & services. The company manufactures transformers at its plants in Mandideep & Malanpur & industrial systems (rotating machines & railway signalling unit) in Pithampur. The company recorded a revenue of US$ million in quarter ending December

54 KEY INDUSTRIES FAST MOVING CONSUMER GOODS (1/2) Factors such as industrial infrastructure in growth centres, cheap labour & central location are the key influencers for establishing consumer goods manufacturing facilities in the state. Many multinational companies, such as Mondelez, Procter & Gamble, Hindustan Unilever Limited, Coca Cola & Cargill, have their manufacturing plants in the state. A majority of the manufacturing plants are located in industrial areas of the state such as Malanpur, Mandideep, Pithampur & Chhindwara. Procter & Gamble s strategic move of relocating its central warehouse for FMCG products to Bhopal has helped it save annual logistics expenses of around US$ 20 million. Many FMCG companies are now relocating their warehouses to replicate this success. To promote growth in the FMCG sector, the state government has established Gwalior as an FMCG cluster. Some key players Mondelez India Foods Ltd Procter & Gamble (P&G) Home Products Ltd Dabur India Ltd Hindustan Unilever Ltd Patanjali Ayurveda Ltd. plans to set up a food processing unit in the state, with an investment of US$ 76 million. The bottling division of Coca Cola in India, Hindustan Coca-Cola Beverages Ltd. (HCCBL), is planning to invest US$ million to set up a bottling plant at in Hoshangabad, Madhya Pradesh. The 110 acre plant, would facilitate multiple bottling lines for its carbonated beverages such as Coca-Cola, Sprite, Fanta, Thums Up and Limca. As of March 2017, Intex Technologies planned to invest US$ million for setting up a manufacturing unit for mobiles, air conditioners and consumer durable goods. 54

55 KEY INDUSTRIES FAST MOVING CONSUMER GOODS (2/2) Mondelez India Foods Mondelez India Foods Ltd is part of Mondelēz International, Inc. It operates in 5 categories chocolate confectionery, beverages, biscuits, gum & candy. Mondelez's key brands in India include Cadbury Dairy Milk, Bournvita, 5 Star, Perk, Bournville, Celebrations, Gems, Halls, Éclairs, Bubbaloo, Tang & Oreo. In India, the company started its operations in 1948 and has 6 factories & 4 sales offices. Procter & Gamble (P&G) Home Products Ltd P&G Home Products Ltd, one of India's largest consumer goods companies, is a 100% subsidiary of Procter & Gamble Company, US. The company owns some of the reputed brands in the fabric, hair & baby care segments. The company has its manufacturing plant at Mandideep in the Raisen district of Madhya Pradesh. Dabur India Ltd Dabur India Ltd is a leading consumer goods company in India with total income of US$ million in Q4, FY17. The company has 2 major divisions: consumer care business & international business division. One of the 17 manufacturing plants of the company is located at Katni in Madhya Pradesh. The total income recorded by Dabur India Ltd during Q3 FY18 was US$ million. Hindustan Unilever Ltd Hindustan Unilever Ltd (HUL) is a subsidiary of Uniliver and is India's largest consumer goods company with a portfolio of brands in 20 distinct categories. Established in 1930, the company has its manufacturing plant at Chhindwara in Madhya Pradesh. HUL recorded net revenue of US$ 1.35 billion during Q3 FY18. 55

56 KEY INDUSTRIES AGRO-BASED INDUSTRY (1/2) Madhya Pradesh is an agrarian state. Around 74% of the population of the state is directly or indirectly, dependent on agriculture. Of the total gross area under crop cultivation in the state, 54.2% is sown during the kharif season while the other 45.7% is sown during the rabi season. Budget estimate for the horticulture and food processing sectors in the state stood at US$ million in. Budget estimate for farmer welfare as well as development of agriculture, during , in the state was recorded to be US$ million. Madhya Pradesh is the largest producer of oilseeds; it produced 8.68 million tonnes in accounting for around 27.05% of the national production. Madhya Pradesh is one of the leading producers of spices such as ginger, chilli and garlic. Jawaharlal Nehru Krishi Vishwavidyalaya is located in Jabalpur and serves as a centre for teaching and research in agriculture and allied sciences. The state was the fourth largest milk producer in India as of March Milk production in the state increased from million tonnes in to million tonnes in Egg production in the state reached 1, million units in , while, meat production in the state increased from thousand tonnes in to thousand tonnes in Dhar, Ujjain, Chhindwara, Jabalpur, Hoshangabad, Guna, Ashok Nagar, Dewas, Indore, Shajapur, Vidisha, Sagar, Ratlam, Sehore, Mandsaur and Khargone are the major districts involved in agriculture and allied industries. The state received the Krishi Karman award for the third consecutive year. Horticulture is an emerging sector in the state. Through the export of aromatic and medicinal plants, the horticulture segment is a potential foreign exchange earner. In , the state recorded utilisation of thousand hectares of land for production of horticulture crops. The state has invested resources into the making of water assets, new plantations, flower gardens and organic farming. Plans are being laid out to set up suitable post-harvest facilities like packing houses, cold storage and mobile processing units. Source: Ministry of Agriculture, Farmer Welfare & Agriculture Development Department Madhya Pradesh Solvent Extractors Association of India, Aranca Research 56

57 KEY INDUSTRIES AGRO-BASED INDUSTRY (2/2) Adani Wilmar Ltd Adani Wilmar Ltd (AWL) is a 50:50 joint venture between two global corporations - Adani Group of India and Wilmar International Limited of Singapore. The company has production infrastructure across the country, with a crushing capacity of over 5,750 tonnes per day and a refining capacity of over 9,000 tonnes per day. The company has a production unit in Chhindwara and a packaging plant at Dewas in Madhya Pradesh. FORTUNE, King's, RAAG, Bullet, Fryola and JUBILEE are the brands under which AWL sells its range of edible oils, vanaspati and bakery shortening. Anik Industries Ltd Anik Industries Limited has business interests in dairy and milk derivative products, wind power, mining & coal, ferro alloys, real estate and agri commodities. The company has three milk processing units in Madhya Pradesh for manufacturing of dairy products, two at Dewas (capacity of 240,000 litres of milk per day and 400,000 litres of milk per day) and one at Bhopal (capacity of 100,000 litres of milk per day). These units are supported by 11 chilling centres spread across the state, which collect milk from 5,000 villages. The company recorded revenue of US$ million during Q3 of FY Ruchi Soya Industries Ltd Ruchi Soya Industries Ltd is one of the major agro-based product manufacturers in India. The product portfolio of the company includes edible oils, soya foods, bakery fat and vanaspati. It is also the largest exporter of soya foods and lecithin from India. The company has a wide presence in Madhya Pradesh with six manufacturing plants located at Mangla, Shujalpur, Guna, Piaparia, Gaderwada and Jabalpur and three depots at Gwalior, Jabalpur and Indore. The company recorded total income of US$ million in Q3 FY18. 57

58 KEY INDUSTRIES TOURISM (1/2) Madhya Pradesh is blessed with scenic beauty, rich heritage of pilgrim centres, temples & wildlife sanctuaries. The state government has identified the tourism sector as a key growth area. International tourist arrivals (in millions) In 2016, foreign tourist arrivals in the state were approximately thousand while domestic tourists were million. The state government has shortlisted 18 noteworthy centres, which draw in large numbers of domestic and foreign tourists for further development. The state government has taken initiatives to promote eco-, wildlife, adventure, leisure, business & pilgrim tourism. The Ministry of Tourism has included Chitrakoot as one of the 35 mega tourist centres sanctioned to be developed. Chitrakoot will be developed as a spiritual & wellness destination. The destination will be developed as a part of the Ramayana Circuit. The government has allocated a sum of US$ million for development of this circuit. As per budget , the state government proposed an allocation of US$ million for the development of the state s tourism department. In February 2017, the state tourism advertisement MP Mein Dil Hua Bachche Sa bagged the prestigious AFI (American Film Institute) award for the best ongoing campaign, which was launched in June * The Central Sanctioning and Monitoring Committee (CSMC) for the Swadesh Darshan Scheme in Ministry of Tourism has approved a sum of US$ million for the development of Heritage Circuit in state of Madhya Pradesh. The circuit will cover cities of Gwalior- Orchha-Khajuraho-Chanderi-Bhimbetka-Mandu. The project would facilitate world class infrastructural development of the sites, including developing a theme park & convention centre in Khajuraho. Site illumination, construction of tourist facilitation centres & parking area are other interventions proposed in the circuit. In 2016 Madhya Pradesh was among the top 5 tourist destination state. Source: MP economic survey

59 KEY INDUSTRIES TOURISM (2/2) The state has 382 tourist sites, including world heritage sites. Major places of tourist interest in Madhya Pradesh are as follows: Kanha: One of the largest wild-life sanctuaries in Asia. Khajuraho: Some of the most famous sculptures in the world. Bhimbetka: The oldest cave paintings in the world. Sanchi: The oldest Buddhist Stupa in the world. Bandhavgarh: The highest density of tiger population in the country. Measures to promote tourism in Madhya Pradesh Promote and market as an attractive tourist destination. Providing decent accommodation in areas of tourist interest, operating a transport fleet of coaches, cars and Gypsys Develop eco-friendly and sustainable tourism facilities. Develop and promote eco- and adventure tourism. Publicity and marketing of tourist destinations and facilities. Bhedaghat: Scenic marble rocks rising up to 100 feet. The state has 9 national parks & 25 wildlife sanctuaries. Numerous festivals, such as All India Kalidasa Festival, Tansen Samaroh (Gwalior), Lokranjan & Khajuraho Dance Festival (Khajuraho), are celebrated in the state, which attract tourists. In January 2017, the Government of Madhya Pradesh developed Hanuwantiya Island, with an investment of US$ 1.19 million, to promote water tourism in the state. The island is located in the reservoir of Indira Sagar Dam, situated on Narmada river. Source: Madhya Pradesh Tourism Policy 59

60 KEY INDUSTRIES FOREST-BASED INDUSTRIES With a share of about per cent of the total forest area of the country, Madhya Pradesh has the largest area covered by forests among all the states in India. In Madhya Pradesh, the average annual production of tendu leaves is estimated around 2.5 million standard bags, accounting for nearly 25% of all tendu leaves produced in India. Tendu leaves, sal seed and kullu gum are nationalised forest produce. Other non-wood forest products are non-nationalised and can be collected and traded freely. Other important forest products popularly traded include Chebulic Myrobalan, Mahua, Sal seeds, Kullu gum and bamboo. Estimated budget for the forest department during stood at US$ million. Sale of forest products contributes significantly to the state revenues. Forest products are either sold through auction in commercial depots, or through sale on pre-defined rates at Nistar depots. As of 2015, there were 40 commercial timber depots and 22 industrial bamboo depots in the state. Source: Forest Department, Madhya Pradesh, Trading & Development Co-Op Federation Ltd. 60

61 KEY INDUSTRIES IT AND ITeS Madhya Pradesh has an optical fibre spine of more than 24,000 km that covers 313 formative blocks over 45 districts. The state is home to the country s 1st Indian Institute of Information Technology & Management (IIITM), which is located in Gwalior. The government has proposed to set up 21 IT SEZs across the state. 5 information technology parks, located at Bhopal, Indore (2), Gwalior & Jabalpur, are at various stages of development. Around 20 companies have signed MoUs worth US$ 1.4 billion for investments in the IT sector within the state. Various information technology infrastructures such as the wide area networks, data centres, etc. are being used for exchanging the information by different departments of the state government. A government society MAP_IT (Madhya Pradesh Agency for Promotion of Information Technology), headed by the Chief Minister & represented by the government & industry, has been established to implement the IT policy & propel the growth of the IT industry in Madhya Pradesh. The state government proposed allocation of US$ million for different activities under science & technology during Contract for setting up a special IT processing centre was granted to Fujitsu Optel Ltd., at Mandideep in Raisen, at an estimated cost of US$ 8.48 million. IT parks Crystal IT Park (51,097 sq. m) Hardware and Software Technology Park (200 acres) Software Technology Park (100,000 sq ft) IT Park (50 acres) IT Park (90 acres) IT projects in Madhya Pradesh Software Technology Park, Indore Crystal IT Park, Indore IT Park, Gwalior Hardware & Software Technology Park, Bhopal Indore Bhopal Indore Gwalior Jabalpur Jabalpur IT Park, Jabalpur Source: Maps of India 61

62 KEY INDUSTRIES MINERAL-BASED INDUSTRY (1/3) Madhya Pradesh is one of the key mineral-producing states in India, providing tremendous potential for industrial growth. With 26 major and minor minerals being mined in the state, it ranks fourth in mineral production. The state has rich deposits of coal, limestone and manganese. Bauxite, dolomite, fire clay, granite and marble stones are other mineral resources available. During (for the period April 2017 to September 2017), value of all minerals produced in Madhya Pradesh was recorded to be US$ 1.17 billion. Madhya Pradesh, with its 1,045,318 carats of proven diamond reserves, is the sole producer of diamonds in India. Madhya Pradesh is the leading producer of minerals such as pyrophyllite and copper. During (for the period April 2017 to September 2017), value of fuel mineral produced in Madhya Pradesh was recorded to be US$ 1.01 billion. Major mineral-based industries in the state are cement, thermal power generation, ceramic-products, tiles and refractory. The Mineral Resources Department of Madhya Pradesh has planned to introduce online electronic transit pass (e-tp) services in Balaghat, Sagar, Tikamgarh, Satna, Rajgarh, Betul, Indore, Ujjain, Neemuch, Gwalior, Bhind and Hoshangabad in December Source: Indian Bureau of Mines 62

63 KEY INDUSTRIES MINERAL-BASED INDUSTRY (2/3) Mineral production in Madhya Pradesh ( 000 MT) Mineral (till September 2017) Coal 53,356 Bauxite 233,718 Copper ore 1,038,251 Copper conc. 33,139 Iron ore 1,016 Manganese ore 356,344 Phosphorite 55,766 Diamond (in carat) 18,388 Limestone 20,967 Source: Ministry of Mines, Government of India, Aranca Research 63

64 KEY INDUSTRIES MINERAL-BASED INDUSTRY (3/3) Hindustan Copper Ltd Hindustan Copper Ltd (HCL) is a vertically integrated copper manufacturing company. In 1982, the company established its Malanjkhand copper project, which has the single-largest copper deposit in the country. The Malanjkhand mine has a copper deposit of 221 million tonnes with 1.3% copper concentration. The company possesses an open-pit mine with a capacity of 2 million tonnes per annum, concentrator plant, tailing disposal system and other auxiliary facilities. The plant contributes around 80.0% of the copper production of the company. HCL s mines and plants are spread across Rajasthan, Jharkhand, Madhya Pradesh and Maharashtra. HCL plans to expand its flagship Malanjkhand mine with an investment of US$ million. During Q3 FY18, the company recorded a turnover of US$ million. NMDC Ltd NMDC is a public sector unit involved in mining of a wide range of minerals such as iron, copper, limestone, dolomite, gypsum, tin, graphite and diamond. The company is the single largest iron ore producer in the country. NMDC is the only organised producer of diamonds in India and produces diamond from its Majhgawan mine at Panna in Madhya Pradesh. The production capacity of the mine is around 84,000 carat per annum. The mine employs around 199 persons. Total Income from operations of US$ million was recorded by the company during Q3 FY

65 TRADE AND INVESTMENT FACILITATION CORPORATION LIMITED (1/2) TRIFAC, established in 2004, is the state s single window clearance facility. As a nodal agency, it extends customized incentives to mega projects (investment over US$ 4.6 million). TRIFAC is a coordinating interface between entrepreneurs and government agencies and provides effective pre-investment and post-investment services. Source: MP Trade and Investment Facilitation Corporation Ltd, TRIFAC - Trade and Investment Facilitation Corporation Limited 65

66 TRADE AND INVESTMENT FACILITATION CORPORATION LIMITED (2/2) TRIFAC activities APEX Level Investment Promotion Empowered Committee Project Clearance and Implementation Board Madhya Pradesh Investment Facilitation Act 2008 Description For project investments over US$ 4.6 million, TRIFAC facilitates obtaining of customised economic package through APEX Level Committee headed by Chief Minister. Acts as an empowered body to grant in-principle approval to mega projects. Acts as member secretary for APEX and State Level Committee, which ensures speedy approvals for various clearances/consents/permissions. Combined application form Under the MP Investment Facilitation Act 2008, a single form for obtaining all necessary clearances. Investment drive Memorandum of Understanding TRIFAC organises investor meets, conducts road shows and industry interactive sessions to stimulate investments in the state. TRIFAC acts as a nodal agency for executing the MoU process for investment plans related to the industry sector. Delhi-Mumbai Industrial Corridor TRIFAC acts as a nodal agency for executing the project in the state. Industrial Investment Promotion Assistance 2004 Audyogik Kendra Vikas Nigam Limited (AKVN) TRIFAC acts as a nodal agency for providing industrial investment assistance in the state. AKVN is the subsidiary company of MP TRIFAC. Land Bank Responsible for maintaining a land database meant for setting up industries in the state. Source: MP Trade and Investment Facilitation Corporation Ltd, TRIFAC - Trade and Investment Facilitation Corporation Limited 66

67 KEY APPROVALS REQUIRED (1/2) List of approvals and clearances required Departments to be consulted Prior to setting up the unit Registration Allotment of land/shed Permission for land use No objection certificate under Water and Air Act Approval for construction activity and building plan No objection certificate Provisional Trade Tax registrations DIC for SSI/ SIA for large and medium industries DI/ SIDC/ Infrastructure Corporation/ SSIDC District authorities/ State DI/ Dept. of Town and Country Planning (in case industry is located outside an industrial area) Madhya Pradesh Pollution Control Board Town and Country Planning/ Municipal and local authorities/ Chief Inspector of Factories/ Pollution Control Board, Electricity Board Fire Department Central and State Excise Departments, Sales Tax Department Before commencement of production No objection certificate under Water and Air Act No objection certificate Permanent trade tax registration under Central Sales Tax Act 1956 Registration under Central Sales Tax Act 1956 Madhya Pradesh Pollution Control Board Fire Department Central and State Excise Departments, Sales Tax Department After commencement of production/activity Registration Department of Commerce, Industry & Employment Note: SIDC- State Industrial Development Corporation, SSI- Small Scale Industries, SIA- Secretariat of Industrial Assistance, DIC- District Industrial Center, Source: MP Trade & Investment Facilitation Corp. Ltd., Aranca Research SSIDC- Small Scale Industrial Development Corporation 67

68 KEY INVESTMENT PROMOTION OFFICES Agency Department of Commerce, Industry & Employment Description The department is responsible for industrialisation in the state through development of small, medium and large scale industries and new investments. The department is also responsible for creation of basic infrastructure and development of industrial parks. The department has several support institutions such as Madhya Pradesh State Industrial Development Corporation (MPSIDC) and Audhyogik Kendra Vikas Nigam (AKVN) in six cities. District Trade and Industries Centre District Trade and Industries Centres are district-level offices of the Department of Commerce, Industry and Employment of the state government. These centres are empowered to provide clearance for setting up industrial units. Madhya Pradesh State Industrial Development Corporation Madhya Pradesh State Industrial Development Corporation (MPSIDC) is a support institution of Department of Commerce, Industry and Employment of the state government. The organisation had the mandate to promote the state as an industrial destination and help companies set up and expand industries in Madhya Pradesh. 68

69 CONTACT LIST Agency Department of Commerce, Industry & Employment Directorate of Industries Madhya Pradesh State Industrial Development Corporation Limited Contact information Mantralaya, Vallabh Bhawan Bhopal Madhya Pradesh, India Phone: Website: Directorate of Industries Vindhyachal Bhawan Bhopal Madhya Pradesh, India Phone: , indsbpl@mp.nic.in Website: AVN Towers 192 Zone-1, M.P. Nagar Bhopal , Madhya Pradesh Phone: Fax: admin@mpsidc.org, mpsidc@sancharnet.in Website: 69

70 COST OF DOING BUSINESS IN Cost parameter Cost estimate Source Cost of industrial land (per sq. ft.) US$ Industry sources Hotel cost per room per night (four-star, five-star hotel) Residential rent (for a 2,000 sq ft house, per month) Commercial rent (per sq ft per month) Power cost (per kwh) US$ US$ US$ Industrial: US cents Leading hotels in the state Industry sources Industry sources Madhya Pradesh Electricity Regulatory Commission Labour cost (minimum wages per day) US$ 3.73 Labour Department, Madhya Pradesh Government Source: Madhya Pradesh State Portal, PwC Research 70

71 STATE ACTS & POLICIES (1/2) Objectives Information Technology Investment Policy 2014 Tourism Policy 2010 (As amended in 2014) Industrial Promotion Policy 2014 To facilitate the growth of the IT sector in the state. To accelerate the use of information technology in the government at all possible levels to improve efficiency, transparency, accountability and increased productivity. Read more To promote balanced and sustainable tourism, which enables socio-economic development and establishes Madhya Pradesh as a destination that provides a complete tourism experience. Aims at providing an effective regulatory mechanism for sustainable tourism and developing the sector through PPP. Read more To improve investor facilitation and ensure rapid economic development and employment opportunities through sustainable use of available resources. Promotes SMEs and ensures PPP initiatives for industrialisation. Envisages an industry-friendly administration and attracting investments by developing quality infrastructure. Read more Madhya Pradesh Investment Facilitation Act 2008 Ensures quick and timely disposal of investors applications at various levels. To strengthen & make the single-window system more effective. Read more IT Policy 2006 To improve the life of common man by leveraging the strength of e-governance & attracting investments in the sector by providing a conducive environment & highly skilled manpower to transform the state from a resourcebased economy to a knowledge-based economy. Read more 71

72 STATE ACTS & POLICIES (2/2) Objectives Conservation of the state s biodiversity & sustainable use of biotechnology resources. Biotechnology Policy 2003 Production of high-yielding, draught and pest-resistant seeds for agriculture & horticulture crops suited to different agro-climatic zones. Improvement of quality of livestock & poultry, especially the breeds indigenous to the state. Afforestation as well as production of cost-effective drugs to treat common diseases of the tropical & sub-tropical regions of the country. Read more Special Economic Zone Policy 2000 To promote development of SEZs in the state. To increase employment opportunities in the state. Read more Analog Semiconductor Fabrication Investment Policy 2015 To increase the flow of investments in the field of electronics manufacturing in the state. Maximising employment generation opportunities and promoting establishment of FAB units. Read more BPO Policy 2014 To boost the flow of investments in the BPO/BPM industry along with promoting establishment of IT/ITeS units in the urban as well as rural areas in the state. To generate and maximise employment opportunities for youth as well as development and infrastructure opportunities in smaller cities in the state. Read more 72

73 EXCHANGE RATES Exchange Rates (Fiscal Year) Year INR INR Equivalent of one US$ Q Q Q Exchange Rates (Calendar Year) Year INR Equivalent of one US$ Source: Reserve bank of India, Average for the year 73

74 DISCLAIMER India Brand Equity Foundation ( IBEF ) engaged Aranca to prepare this presentation and the same has been prepared by Aranca in consultation with IBEF. All rights reserved. All copyright in this presentation and related works is solely and exclusively owned by IBEF. The same may not be reproduced, wholly or in part in any material form (including photocopying or storing it in any medium by electronic means and whether or not transiently or incidentally to some other use of this presentation), modified or in any manner communicated to any third party except with the written approval of IBEF. This presentation is for information purposes only. While due care has been taken during the compilation of this presentation to ensure that the information is accurate to the best of Aranca and IBEF s knowledge and belief, the content is not to be construed in any manner whatsoever as a substitute for professional advice. Aranca and IBEF neither recommend nor endorse any specific products or services that may have been mentioned in this presentation and nor do they assume any liability or responsibility for the outcome of decisions taken as a result of any reliance placed on this presentation. Neither Aranca nor IBEF shall be liable for any direct or indirect damages that may arise due to any act or omission on the part of the user due to any reliance placed or guidance taken from any portion of this presentation. 74