Madhya Pradesh Industrial Policy | Course for MPPSC Preparation - MPPSC (Madhya Pradesh) PDF Download

Industrial Development of Madhya Pradesh

• Madhya Pradesh, the second largest Indian state, is endowed with rich natural resources, salubrious climate and fertile agro-climatic conditions. In the recent years, Indian economy has changed substantially. Market forces have begun to dictate investment flows across the industrial sectors. Accelerating investments in industrial development for economic growth is one of the major focus areas for Madhya Pradesh.

Salient Highlights of Industrial Development of Madhya Pradesh

• Today, Madhya Pradesh is one of the fastest growing states in India, backed by an impressive annual growth rate of 11.98% during 2011-12. The state has recorded an impressive growth in GSDP averaging over 9% during the last decade of stable governance, supplemented by creation of a robust support infrastructure in terms of roads, water supply, irrigation capacity and a year round 24×7 power supply.
• Between 2004-05 and 2015-16, Gross State Domestic Product (GSDP) expanded at a Compound Annual Growth Rate (CAGR) of 11.84 per cent to US$ 86.32 billion whereas the Net State Domestic Product (NSDP) expanded at a CAGR of 12.0 per cent to US$ 77.55 billion.
• In Madhya Pradesh, investors have better options in terms of project location, infrastructure, incentives and other facilities. At present the state has prospective investment proposals of more than US$ 104 billion under various stages of consideration..
• Having established a strong pedestal for rapid economic development, the people centric transparent policies and hassle-free investment procedures in the state are gradually making Madhya Pradesh a Global Investment Hub. Already, domestic and global multinational firms including TEVA, TCS, Infosys, John Deere, Bridgestone, Reliance, Cummins, Volvo, Novartis, P&G, AkzoNobel, and Essar have made investment in the state.
• The abundant manpower of the state has been developed into a skilled technical workforce, with the presence of world class institutes like IIM, IIT, AIIMS, Engineering colleges and several ITIs.
• The state is leading in textile manufacturing, automobiles, food processing, soya processing, engineering and agriculture equipment manufacturing.
• The state is rich in natural resources, fuels, minerals, agriculture and biodiversity. It is aggressively emerging as a solar power hub, and is targeting generation of 2,650 MW of solar power by 2017. Upcoming theme based SEZs near Jabalpur, industry parks in Indore and food parks at multiple locations aim to promote sectoral growth.
• Industry in Madhya Pradesh is largely natural resources driven. It has abundant natural wealth in the form of limestone, coal, oilseeds, pulses, bauxite, iron ore, diamond, copper ore, manganese ore, rock sulphate, silica, soya, cotton and so on. The state has a strong industrial base in sectors like Textile, cement, steel, food processing, automobile and auto components, pharma and optical fibre. Madhya Pradesh is rich in resources to attract investment in the state
• The state has excellent infrastructure, with 19 industrial development parks, 129 industrial areas, six food parks, eight integrated development centres, three dry parks, one stone park, one IT park, one SEZ and an apparel park at Indore. A gems and jewellery park is being developed in Indore to promote the diamond industry in the state.Industrial Developement of Madhya Pradesh
• 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 and non-resident Indians (NRIs) to the state, and provide various facilities and concessions to them.

Advantage Madhya Pradesh

The government of Madhya Pradesh recognizes the need for faster economic development in the state with a strategy for encouraging investment and achieving higher levels of economic development.

• Strong economy : One of the fastest growing  states in India  backed by an impressive  CAGR of  5% during the period 2006-12
• Robust industrial infrastructure : 231 Notified industrial Areas,19 growth centres, 4 notified Special Economic Zones (SEZs) and 12 product specific industrial parks to facilitate industrial investments.
• Strategic location : Located at the centre of India, within the close proximity of all major markets and tier- one cities across the country.
• Stable government and peaceful work environment : The government of Madhya Pradesh has introduced several investor-friendly policies and created single window secretariat, MPTRIFAC for smooth facilitation of investment process in the state.
• Excellent connectivity : A robust road network-99403 km, making it an ideal destination as centralized manufacturing and distribution hub.
• Large land parcels for industrial use : Over 16,000 hectares of land for industrial use at various strategic locations across the state.
• Strong consumer base: With population of over 70 million, the state has decadal urbanisation growth rate of 26% with bigger cities growing as high as 40%.

Rich Natural Resources

• Madhya Pradesh has 11 different agro-climatic zones.
• Rich mineral wealth of iron ore, diamonds, copper ore, manganese ore, bauxite, limestone, coal and marble, granite.
• 12% of India’s forests are in Madhya Pradesh.
• Scarce fuel resources such as coal and coal-bed methane are available in plenty.
• 14% of India’s coal reserves are in Madhya Pradesh.
• Asia’s thickest coal seam is located in the district of Sidhi.
• Madhya Pradesh has operational diamond mines in India.
• 144 BCM of coal bed methane reserves have been identified.
• Prospecting for blocks available for captive mining for power, cement, iron and steel units.
• Large reserves of limestone, which is the basic construction raw material.
• Manganese and dolomite, key ingredients to iron and steel are found here.
• Exotic varieties of dimensional stones i.e., marble, granite and flagstone are available.
• Agri Bounty:-
• Largest producer of oilseeds in, the country at 23.92% of the total output.
• The state is in first position by producing 25% of pulses and 40% of Grams of total Production of the country.
• Commercially favoured varieties of wheat and potato grown.
• Largest producer of garlic and coriander.
• Massive wastelands and government farms measuring from 50 to 3000 acres ready to be offered for investment.
• Government of Madhya Pradesh has prepared a policy for allotment of Non Forest Waste Land for the investors.
• Contract Farming is allowed.

Rich Biodiversity

• 30% of state under forest cover.
• 11 of 25 Global Agro-climatic Zones in the state.
• A largely unexploited species of rare, valuable medicinal-herbal plants.

Skilled Manpower & Education Centre:

• About 90,390 technical graduates and an overall figure of 2,70,000 graduates add to the workforce each year. IIIT at Gwalior and Jabalpur, National Law Institute University and National Judicial Academy, Indian Institute of Forest Management (IIFM) at Bhopal, Indian Institute of Management (IIM) and Indian Institute of Technology (IIT) at Indore and a large number of such national level and renowned state level educational centre are located in Madhya Pradesh.

Cluster based development at 6 key places

• Indore : Pharma, Textile, Food Processing, IT and Auto Components.
• Bhopal : Engineering, Textile, Biotech, Herbal, IT and Food Processing.
• Jabalpur : Garments, Mineral, Stone, Forest, Herbal and Food Processing.
• Gwalior : Electronics, IT, FMCG, Engineering, Stone and Food Processing.
• Rewa : Minerals, Cement, Agro and Forest Produces.
• Sagar : Mineral Processing and Stone.

Industry Facilitation

Madhya Pradesh is fast emerging as new destination for industries with following facilitation:-

• Creation of Industry – friendly administration and an incisive industrial promotion policy.
• The state provides a facilitative environment for the development of small, medium and cottage enterprises.
• It has Special Economic Zones.
•  Ensures reliable power to the industries.
• Air connectivity with major industrial towns available.
• Special package of incentives for Mega Investment Projects, with investment above Rs. 25 Crores.
• Assistance for setting up of Industrial Parks.
• Concessions for Tourism Projects.
• Single table clearance for mega projects through project clearance Implementation Board (PCIB). Projects worth aprox. Rs. 2,64,129 Crores facilitated.

Established Institutional Mechanism

• MPTRIFAC is the Single Window Secretariat for investment facilitation
• District Level Investment Promotion Empowered Committee- headed by District Collector
• State Level investment promotion Empowered Committee- headed by Industries Minister
• Apex Level Investment Promotion Empowered Committee- headed by Hon’ble Chief Minister.

Focus Sectors

Agribusiness & Food Processing

• Vibrant and fast fastest growing agricultural sector – registered average growth rate of over 20% for the last 5 years.
• Largest producer of Soybean, Gram, Garlic and Pulses, in India
• Second largest producer of Wheat, Green Peas and Onion, in India
• 4th largest producer of milk and 5th largest producer of fish, in the country
• Favorable ecosystem for agriculture production and related businesses – 5 crop zones, 11 agro climatic zones and 4 soil types
• Ready industrial infrastructure – 8 integrated and modern food parks operating in the state

Investment Opportunities

• Direct Procurement – Fruits and Vegetables, Flowers, Dairy Products and Food Grains
• Infrastructure Development – Food Parks, Cold Storage, Warehousing & Logistics and Irrigation Projects
• Food Processing and Value Addition – Soybean, Oats, Milk, Fruits and Vegetables

Automobile and Engineering

• Indore, commercial capital of Central India, and surrounding areas (Pithampur and Dewas) constitute Automobile & Engineering hub of Madhya Pradesh
• Spread across 2,000 Ha., Pithampur Auto cluster has over 90 large and 700 SME units – Auto, OEMs and Auto parts manufacturers
• Support infrastructure available around Pithampur include – National Automotive Test Tracks (NATRAX), ICD, Skill development institutes like Indo German Tool Room and Symbiosis University of Applied Sciences

Investment Opportunities

• Assembling and Manufacturing – Automobiles and Auto Components
• Centers of excellence – Automobile Design Centers, R&D Facilities and Training Centers
• Infrastructure Development – Auto and Ancillaries Parks and Machine Tools Parks
• Auto financing and vehicle retailing

Urban Development

• Untapped Potential – only 28% of population in Madhya Pradesh lives in its 378 urban centers, including in 4 cities with million plus population; vast room for urbanization
• Five cities are in SMART CITY mission of Government of India
• Investment plans of ~US$13bn/ Rs83,800 Crs in urban infrastructure in the next 4 years. Major projects include – Smart cities Mission (US$3 bn/ Rs20,000 Crs), Housing for All project (US$3 bn/ Rs 20,000 Crs), and Bhopal &Indore Metro Rail Projects (US$2.2 bn/ Rs 15,000 Crs)

Investment Opportunities

• Urban Transport – Public Transport Operations, Mass Rapid Transport (Metro/Light Metro), Freight Terminal, Urban Transport Infrastructure, Flyovers, Ring Roads, Bridges and Parking
• Affordable Houses and Real Estate – Affordable Housing Projects and Integrated Townships
• Urban Services – Water Supply Management, Waste Water Management and Solid Waste Management

Renewable Energy

• 8x increase in renewable energy installed capacity in the last five years (438 MW in 2011-12 to 3,311 MW in February 2017)
• Capacity is further expected to increase over 3 times in the next three to four years-10,950 MW capacity is under implementation
• Key projects include 135 MW Solar Power Plant at Neemuch and Rewa Ultra Mega Solar Power Project (under implementation; 750 MW)

Investment Opportunities

• Solar and wind power plants
• Transmission & distribution infrastructure
• Renewable energy equipment/system production
• Switchgear and transformers

Pharmaceuticals

• Conducive ecosystem for pharmaceutical industry – over 280 pharmaceutical units located in the state out of which 152 are formulation manufacturers
• Major pharmaceutical clusters in the state include Pithampur, Indore, Dewas, Mandideep, Bhopal and Ujjain

Investment Opportunities

• Bulk drug manufacturing, development of manufacturing devices
• Clinical trial markets and high-end drugs
• Contract research services
• R&D and production of vaccines and recombinant therapeutics
• Biotechnology parks and other infrastructure

IT/ ITeS

• Madhya Pradesh is fast emerging as a location of choice for IT/ITeS companies
• 12 IT-SEZs granted formal approval in the state; existing IT Parks at Electronics Complex Indore, Crystal IT Park Indore and Malanpur Gwalior; proposed IT Parks at Bhopal and Jabalpur
• Large talent pool – over 100,000 engineers graduate from Madhya Pradesh, annually

Investment Opportunities

• Ready–to–move built up space and developed/raw land plots available for IT/ITeS industry in four major cities of Madhya Pradesh – Indore, Bhopal, Jabalpur and Gwalior
• The state is suited for running low cost IT/ITeS operations

Tourism

• Premiere tourist destination of India – tourist arrival has grown at a CAGR of 24% in the last eight years (2007-2015); 78.4 mn tour the state in 2015
• Hub for wildlife and nature based tourism
• Major wildlife destinations include national parks of Kanha, Bandhavgarh, Pench, Panna and hill station of Panchmarhi
• Major historical and cultural sites includes Sanchi, Khajuraho, Bhimbetka, Gwalior, Mandu, Orchha, Ujjain, Omkareshwar, Maheshwar and Amarkantak.

Investment Opportunities

• Village, Wellness and Water Tourism
• Meeting, Incentives, Conferences and Events (MICE) Tourism
• Film, Eco and Religious fares
• Support infrastructure like wayside amenities and hotels

Textile

• 5th largest cotton producing state in the Country with 17.5 lakh bales of production in 2014-15
• Country’s 4.5% cotton is produced in MP
• Rich tradition of weaving and knitting
• Madhya Pradesh has 65 textile mills
• Indore, Ujjain, Dhar, Dewas, Khargone, Khandwa, Burhanpur, Gwalior, Chhindwara, Sehore, Jabalpur and Bhopal are major centers for textile industry in Madhya Pradesh

Investment Opportunities

• Ginning & Spinning
• Weaving & Knitting
• Dyeing & Finishing
• Garmenting
• Technical Textiles

ESDM

• Madhya Pradesh strongly promotes ESDM sector in the state. It is evident from participation of the state in GoI’s schemes for the sector
• The State is front runner in the implementation of GoI schemes like Digital India, Electronics Manufacturing Cluster Scheme, Smart Cities Mission and National Solar Mission
• Like GoI, The State Government targets to achieve zero electronic imports. To this end, electronic manufacturing clusters are being developed to provides state-of–the-art infrastructure for upcoming facilities
• Additionally, financial incentives are being offered under IT Policy and Analog Semiconductor Fabrication Investment Policy of the state
• These policies provide for numerous concessions including land concessions, tax reimbursements, capital subsidy and interest subsidy

Investment Opportunities

• Setting up of Electronics Manufacturing Clusters(EMCs)
• Developing and manufacturing electronic components
• Developing semiconductor design
• Setting up of Semiconductor Wafer Fabrication(FAB) facilities
• Setting up Electronics Manufacturing Services(EMS) units
• Developing and manufacturing telecom products
• Developing and manufacturing industrial/consumer/medical/defence electronics

Defence

• India is the largest importer of arms in the world – accounts for about 14%of the world’s arms imports
• Government of India is aiming to change this situation by promoting self-reliance and indigenisation
• With historical ordnance manufacturing sites of Katni, Jabalpur and Itarsi, and presence of companies like BHEL, L&T, Bharat Forge and Punj Lloyd, Madhya Pradesh provides ready-made ecosystem for defence manufacturing

Investment Opportunities

• Defence products manufacturing
• Supply chain sourcing opportunity
• Defence offsets
• Manufacture, Repair and Overhaul (MRO)

The following are some of the major initiatives taken by the government to promote Madhya Pradesh as an investment destination:

• Under Prime Minister Graamin Sadak Yojana, during 2016-17, construction of more than 2,000 km of roads has been targeted by the state government. For the development of various roads in the state, allocation of US$ 1.12 billion has been proposed by the state government
• Work on construction of IT parks in 4 major regions of the state, including Indore, Gwalior, Bhopal and Jabalpur, is expected to be initiated during 2016-17. Moreover, electronic manufacturing clusters are also being established in Jabalpur and Bhopal. For these new establishments, Government of Madhya Pradesh allocated an amount of US$ 7.94 million as per the Budget 2016-17.
• For a structured growth, the government has divided the state into six clusters – Indore, Bhopal, Jabalpur, Gwalior, Rewa and Sagar.
• MPSIDC has undertaken a US$ 13.3 million project to bring water from Narmada River to Dewas under the BOT scheme. The project would likely resolve the water problems of 460 industries and facilitate further industrialisation of the Dewas industrial belt.
• The state is developing two SEZs at Hargarh and Umariya- Dungariya. Once operational, the Hargarh SEZ will provide infrastructure support to mineral-based industries, while Umariya-Dungariya will cater to the agriculture and food processing industries.
• The state government has announced plans to upgrade existing apparel clusters at Indore and Jabalpur. The state government has established a textile park in Chhindwara.
• Indore has been identified for infrastructure development under the Textiles Centre Infrastructure Development Scheme (TCIDS). Indore is a cluster of the readymade garments industry with over 1,260 garment units.
• To attract investment into the textile sector, the government has provided an interest subsidy for five years at the rate of five per cent for textile projects and seven per cent for composite textile projects. Furthermore, the government provided 100% assistance in plant and machinery for eight years under Industrial Investment Promotion Assistance Scheme.