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MADHYA PRADESHSeptember 2009

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Investment climate of a state is determined by a mix of factors

Investment climate of a state

• Skilled and cost-effective labour

• Labour market flexibility

• Labour relations

• Availability of raw materials and natural

resources

• Tax incentives and exemptions

• Investment subsidies and other incentives

• Availability of finance at cost-effective terms

• Incentives for foreign direct investment

(FDI)

• Profitability of the industry

• Procedures for entry and exit of firms

• Industrial regulation, labour regulation,

other government regulations

• Certainty about rules and regulations

• Security, law and order situation

• Condition of physical infrastructure such as

power, water, roads, etc.

• Information infrastructure such as telecom,

IT, etc.

• Social infrastructure such as educational

and medical facilities

Resources/Inputs

Incentives to industryPhysical and social

infrastructure

Regulatory framework

MADHYA PRADESH September 2009

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The focus of this presentation is to discuss…

Infrastructure status

State policies and incentives

Business opportunities

Doing business in Madhya Pradesh

Overall competitiveness of the state

Madhya Pradesh‘s economy and socio-economic profile

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Madhya Pradesh September 2009

STATE ECONOMY AND SOCIO-ECONOMIC PROFILE

• Madhya Pradesh (MP) is located in central India. The state covers an area 308,000 sq kms and has a population of over 60.3 million.

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

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

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

• MP‘s forest area constitutes 31 per cent of the total area of the state area and 12.44 per cent of the total forest area of India.

• The state‘s central location gives it the advantage of being the hub for the national logistics network of India.

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

Madhya Pradesh – a snapshot

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Socio-economic snapshot

Population (Census 2001) 60.3 mn

Density (2001) 196 per sq km

Sex ratio (Census 2001) 920 females per 1000 males

Principal language Hindi

Literacy rate (Census 2001) 64.1 per cent

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

Major industries Cement, textiles ,minerals, edible oil

Major crops Soyabean, gram, pulses like Masoor and Arhar

NSDP at current prices in 2007-08 US$ 30.6 bn

Annual per capita income at current

prices in 2007-08

US$ 448

Domestic airports Bhopal and Indore

Sources: Socio-economic survey of MP, 2008–2009, published 2 July 2009, p. 2

Official website of Government of India, www.india.gov.in, accessed 24 September 2009;

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Economic profile

• The state has large mineral resources of coal, diamond, limestone, methane and so on.

• It is ranked amongst the top four states in the country for industrial investments.

• State GDP growth rate: 5.57 per cent

• Per capita income: US$ 448

• Net State Domestic Product (NSDP) at current prices (2007–2008): US$ 30.6 billion

• Minor Forest Produce (MFP), such as Tendu leaves, salwood, teak wood and lak are major contributors to

the rural economy of the state.

Source: Handbook of Statistics on Indian Economy 2008–09,

Reserve Bank of India website, www.rbi.org.in, accessed 24

September 2009

US$

bn

Source:Union Budget and Economic Survey, Ministry of Finance, GOI,

http://indiabudget.nic.in/es2008-09/tables.htm,

accessed 24 September 2009

Sectoral contribution to GSDP

NSDP at current prices (US$ bn)

Source: Socio-economic survey of MP, 2008–2009, published 2 July 2009, p. 20

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INFRASTRUCTURE STATUS

Physical infrastructure

Air

port

sR

ailw

ay n

etw

ork

• Well-connected with the rest

of India

• Almost 425 trains pass

through the state on a daily

basis

• 175 trains pass through the

state capital, Bhopal, alone

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

• Five operational airports, 25 airstrips

• Indore airport has the capability of handling international cargo

• An international airport is proposed for Bhopal

INDORE BHOPAL

JABALPUR

GWALIOR

KHAJURAHO

Source: MP at a glance 2008, Directorate of Economics and

Statistics, accessed 24 September 2009

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Road

netw

ork

• Total road length in the state is 59,184 Kms.

• ational highways of 4,277 Kms. run through the state.

• 18 national highways including trunk routes of Delhi-Mumbai, Delhi-Chennai, Delhi-Bangalore, Delhi- Hyderabad.

• The total length of state highways is 10,373 Km

• Convenient linkages to western ports, i.e., Kandla Port and Jawaharlal Nehru Port Trust

Source: MP at a glance 2008, Directorate of Economics and

Statistics, accessed 24 September 2009

s

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Power

• The installed electricity generation capacity of Madhya Pradesh is 9,658.45 MW.

• 95.66 per cent of MP‘s electricity generation capacity is based on thermal energy, with the remaining from hydel sources.

• On a per capita basis, electricity consumption in Madhya Pradesh stands at 352 kilowatt hour (kWh) per annum, close to the national average of 355 kWh per annum.

Power fact file for MP

Total power generation installed capacity 9,658.45 MW

Thermal 2,857.50 MW

Hydel 922.95 MW

Captive power 1,481.00 MW

Source: Socio-economic survey of MP, 2008–2009, published 2 July 2009, p. 67

Upcoming projects in MP (indicative list)

Thermal power projects

Malwa TPSPurni, Dist. Khandwa

2X500 MW

Essar Group Project

Mahan coal field at Sidhi-Singrauli fields

1000 MW

Jaypee Group Siddhi 1000 MW

Sanjay Gandhi, Birsinghpur – Unit

V500 MW

Amarkantakextension

210 MW

Jindal Group - NA

Hydel power projects

Marhikheda hydro project (extension)

Shivpuri. 1x20 MW

Tawa HEP (M/s Hindustan Electro

Graphite)Hoshangabad 13.5 MW

Coal bed methane

Reliance Energy Shahdol -

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Power and Telecom


Telecom fact file for MP

No. of cellular mobile subscribers 8,87,990

No. of telephone exchanges 2,791

Teledensity (telephones per 100

population)

3.9

Working Direct exchange lines

(DELS)

23,57,660 ( Wired-

12,03,458, WLL

2,66,212 and GSM

8,87,990)

OFC route length in km 27,222.7

Working internet connections 1,51,999

Working broadband connections 34,096

Projected power generation capacity

Source: Socio-economic survey of MP, 2008–2009, published 2 July 2009, Source: MP Telecom circle at a glance, www.mp.bsnl.co.in,


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Social infrastructure

Education

• Ranked 12th on the Human Development Index.

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

• The state has 124 engineering colleges, over 300 technical training institutes and seven medical colleges .

• Key national institutes in the state include:

• Indian Institute of Management (IIM), Indore

• Indian Institute of Forest Management

• Indian Institute of Hotel Management

• International Institute of Professional Studies, Indore

Educational institution Number

Primary schools 94,890

Higher secondary schools 8,504

Degree colleges 303

Universities 17

Polytechnic institutes 158

Industrial training institutes 343

Engineering colleges 124

Medical colleges 7

Source: MP at a Glance 2008, Directorate of Economics and

Statistics website, accessed 24 September 2009

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Health

Social infrastructure

• Network of health facilities comprises 48 hospitals, 417 community health centres and 1,670 primary health centres.

• It also has 34 Ayurvedic and 22 Homoeopathic hospitals.

• The number of in-patient beds in MP‘s hospitals is 20,839.

Health institution Number

District hospitals 48

Sub-centres 10,402

Primary health centres 1,670

Community health centres 417

Ayurvedic hospitals 34

Unani hospitals 2

Homeopathic hospitals 22

Source: Ministry Of Health & Family Welfare website,

Government of India,

http://www.mohfw.nic.in/NRHM/State%20Files/mp.htm,


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Industrial infrastructure - key clusters

Through the Madhya Pradesh Audyogik Kendra Vikas Nigam Ltd (MPAKVN) scheme, the

state government has identified several industrial clusters. Several industrial giants have their establishments

in these areas. However, 44 per cent of the developed area is still untapped and open to investment.

Area developed: 1,330 hectares

Allotted: 618 hectares

Units established: 286

Major groups: HEG, Crompton Greaves,

P&G, Godrej, Lupin, IFB, Oswal, Nahar

Special infrastructure: Inland Container

Depot (ICD), Food Park




Major groups: JK, Surya Roshini,

Godrej, Grasim, Cadbury, Hotline,

Crompton Greaves

Special infrastructure: ICD, Food

Park

Area developed: 790 hectares



Major groups: Raymond, Hindustan

Petroleum, PBM, Ayur

Special infrastructure: Stone Park,

Food Park

BH

OPA

L A

KV

N

GW

ALIO

R A

KV

N

JAB

ALPU

R A

KV

N

Malanpur, Malanpur Phase II,

Banmore, Chainpura,

Siddhgawan, Pratappura

Borgaon, Maneri,

Purena

Mandideep,

Pillukhedi,

Mandideep Phase II

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Industrial infrastructure - key clusters




Major groups: Tata, Ranbaxy, Eicher,

Bridgestone, Hindustan Motors, Kinetic, SRF, S.

Kumars, Gajra, Nicholas Piramal, Indorama,

IPCA, Bhilwara

Special infrastructure: SEZ, Crystal IT Park,

Food Park, Apparel Park

Total

developed area

7,147

hectares

Total allotted

area

3,089

hectares

Total units

established1,360

Growth

centres19

IND

OR

E A

KV

N

Area developed: 273 hectares



Major groups: Birla, Jaypee

Special infrastructure: Integrated

Infrastructure Development Centres (IIDC)

REW

A A

KV

N

Pithampur, Kheda,

Dewas, Maksi,

Megh Nagar

Rewa,

Waidhan

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STATE POLICIES AND INCENTIVES

State level policiesIndustrial Promotion Policy 2004 (amended in 2007)

• The policy envisages creating an industry-friendly administration, quality infrastructure, maximizing employment opportunities, tackling industrial sickness, rationalising rates of commercial taxes and bolstering private sector participation.

• To make the state administration industry friendly by simplifying rules and procedures

• To accelerate the pace of industrialisation and make Madhya Pradesh a leading industrial state

• To maximise employment prospects

• To attract foreign investment by developing world-class infrastructure

• To create a congenial environment for the development of small, medium and large industries

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

• To chalk out special packages to remove industrial sickness

• To integrate different employment-oriented schemes in order to provide employment opportunities on a

sustainable basis

Objectives of the Policy

Source: Department of Commerce, Industry and Employment, Government of MP

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State level policies

IT Policy – 2006

• It aims to improve the life of the common man by leveraging the strengths of e-governance.

• Aims to attract investment in the sector

• Create a pool of highly skilled professionals who are at par with the best in the country

• Transform MP from a resource-based economy to a knowledge -based economy

Biotechnology Policy – 2003

• Conservation of the state's biodiversity and the sustainable use of its biotic resources.

• Production of high-yielding, draught and pest resistant seeds for agriculture and horticulture crops suited to different agro-climatic zones.

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

• Enhancing the productive potential of the aquatic eco-system.

• Promotion and cultivation of medicinal and aromatic plants.

• Production of cost effective drugs that help counter diseases common in the tropical and sub-tropical regions of the country.

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

• Afforestation, and efforts to increase the numbers of those species whose numbers are declining

Source: Department of Information

Technology, Government of MP

Source: Biodiversity and Biotechnology Department, MP

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State level policies

Special Economic Zone Policy Tourism Policy, 1995

• Exemption from all state and local taxes and levies for transactions with the SEZ and for supply from domestic tariff areas to the SEZ

• Exemption from stamp duty and registration fee

• Grant of labour, energy, environment, industrial health and safety-related permits and approvals through a dedicated single window mechanism

• Exemption from electricity duty, cess and any other tax or levy on sale of electricity for self-generated and purchased power

• Expeditious process for land acquisition to set up SEZs

• Focuses on the improvement and creation of adequate basic infrastructure

• The policy announced a special package of incentives for the tourism industry including exemption from luxury tax, sales tax and entertainment tax up to 10 years for new projects.

• Designated 25 tourist circuits for exemption from commercial tax for tourist vehicles

Source: SEZ India, MOCI

Source: Tourism Department, Government of MP

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Power sector: policy environment

Policy initiatives by GOI

• 100 per cent FDI is allowed under the automatic approval route

in all segments of the industry, i.e., generation (based on coal, gas,

or hydro), transmission and retail distribution.

• Under the Mega Power Policy, incentives such as capital import

duty concessions, waiver of local levies to improve cost

attractiveness are extended to large power generation projects

• All power projects are extended a tax holiday — a tax deduction

of 100 per cent on profit earned by the generation, transmission

or distribution company, for 10 consecutive years out of 15 years

from the year of commencement

Key GOI initiatives under the Electricity Act 2003

• Generation other than for large hydro projects, has

been de-licensed

• Open access to transmission and distribution networks

• To encourage development of power in rural areas,

generation and distribution has been de-licensed in rural

areas

• Power trading and market development are being

recognised

• Strong anti-theft and malpractice provisions

• Functional unbundling of the integrated state electricity

boards and setting up of state electricity regulatory

commission made mandatory by states.Source: Energy Department, Government of MP

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State policy initiatives

• Competitive bidding for awarding projects

• Incentives for mega power projects

• Relaxation of 40 per cent cap for debt exposure by Indian financial

institutions

• Inter institution group for speedy financing

• Encouragement to FDI in transmission via joint venture route and

independent power transmission company route

• National Electricity Policy and National Tariff Policy notified

Power sector: policy environment

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State level incentives

Special incentives

• Special package for mega projects on project basis by apex level empowered committee headed by the Chief Minister

• Industrial investment promotion assistance – 50 to 75 per cent of commercial tax for three to 10 years

• Concessional registration charges and stamp duty exemption for term loans

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

• For thrust sector industries, 25 per cent capital subsidy would be provided limited up to a maximum of US$ 56,000

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

• Entry tax exemption for five years

• Five year electricity duty exemption on captive power generation

• 15 per cent capital subsidy to SSIs in backward areas up to a limit of US$ 33,000

• Infrastructure grant up to US$ 0.22 million for developing private sector industrial parks

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

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Madhya Pradesh economy and socio-economic profile

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BUSINESS OPPORTUNITIES

Thrust areas for the state

Auto and auto components

• The state has developed an industrial cluster at Pithampur and the Union Government of India has sanctioned an auto cluster in the Pithampurindustrial area.

• PithampurAuto Cluster houses automotive original equipment manufacturers (OEMs) such as Bajaj Tempo, Eicher Motors, Hindustan Motors, Kinetic Motors, and L&T, major tyre producing unit s by Bridgestone and ACC and about 30 auto component and ancillary units.

• The value of production in the cluster totals approximately US$ 620 million annually.

• 60 per cent of the auto industry in MP is dominated by auto component players.

Source: Pithampur auto cluster, http://www.pautocluster.com/aboutpacl.asp/,


Textiles

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

• Major textile players include Bhilwara, Indo-Rama, Bhaskar, S..Kumar‘s, Oswal and Parasrampuria.

• To further support business endeavours, the state government has created specialised infrastructure in the form of Apparel Parks.

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Source: Reserves of important minerals in MP, Directorate of Geology & Mining, MP, accessed 24 September 2009

Cement

• The state has total limestone reserves of 3,625.98 million tonnes spread across more than 15 districts.

• Seven major cement plants are operating in the state with an annual installed capacity of 15.97 million tonnes.

• According to the MP State Industrial Development Corporation forecast, the Damoh-Panna area and Bela-Pagra of Rewa have limestone deposits worth eight million tonnes and 20 million tonnes respectively.

• There is scope for further investment to the tune of US$ 2.5 billion in this sector.

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Domestic tourist arrivals in MP (in million)

A sharp increase due to

the Kumbh Mela, a

religious festival held

once every three years

Source: Incredible India, Tourism Statistics at a Glance 2008, Ministry of Tourism, www.tourism.gov.in/, accessed 24 September 2009

Tourism

• The tourism sector in MP has been identified by the state government as one of the key propellers of growth

• In 2008, the domestic tourist inflow number stood at approximately 22 million.

• The foreign tourist arrivals were relatively less at 0.16 million.

• The state government has shortlisted 18 major centres, which attract a large number of domestic and foreign tourists, for comprehensive development.

• The government is also making concrete efforts to improve air connectivity between MP and other Indian states.

• The state has taken initiatives to promote eco and adventure tourism and is also keen on promoting medical/ herbal tourism in association with private parties.

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Major tourist attractions

• Kanha is the largest wildlife sanctuary in Asia.

• Khajuraho has some of the most famous sculptures

in the world.

• Bhimbetka has the oldest cave paintings in the world

• Sanchi houses the oldest Buddhist stupa in the world.

• The state has nine national parks and 25 game sanctuaries.

Foreign tourists arrivals in MP (in thousand)

Source: MP Tourism Development Corporation

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Agri Export Zones in MP for various products/ crops

Potato, onion and garlicPulses Oranges

Seed spices - coriander and fenugreekWheat

Source: Union Budget and Economic Survey, Ministry of Finance, GOI,

http://indiabudget.nic.in/es2008-09/chapt2009/tab115.pdf, accessed 24

September 2009

Agriculture

• Several AEZs (Agri Export Zones) have been set up for facilitating export of specific products from a geographically contiguous area.

• The commodities that have high export potential include potato, spices (grown in the western MP), pulses (grown in central MP), wheat (grown in western and central MP) and oranges (grown in the southern districts).

• Of the total gross area under crop cultivation, 59 per cent is sown in the Kharif season while the other 41 per cent is sown in the Rabi season.

• The state leads in the production of spices and is the largest producer of garlic, accounting for 37 per cent of the total national production.

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Agriculture

• MP is the largest producer of soyabean and produced 5.48 million tonnes in 2007–08, which accounted for 49.95 per cent of the national production.

• The state is also the largest producer of oilseeds and produced 6.35 million tonnes in 2007–08, accounting for 21.34 per cent of the national production.

About 24 per cent of the area under crop cultivation can be utilised for cultivation at any given time of

the year irrespective of the season.

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IT parks

Crystal IT Park (5,50,000 sq ft) Indore

Hardware and Software Technology Park (200 acres)

Bhopal

Software Technology Park (1,00,000 sq ft)

Indore

IT Park (50 acres) Gwalior

IT projects in MP

Hardware & Software

Technology Park, Bhopal

Crystal IT Park, Indore

Software Technology Park,

Indore

IT Park, Gwalior

IT/ITES sector

• The state has a fibre optic backbone of over 24,000 Kms. to cover its 313 developmental blocks across 45 districts.

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

• The state has 38 IT engineering colleges. It is home to the country‘s first Indian Institute of Information Technology and Management (IIITM), which is located in Gwalior.

• Large IT players like HCL and Genpact have shown interest in setting up facilities in the state. GenpactIndia is setting up a 7,000-seat business process outsourcing (BPO) facility on 50 acres in Bhopal, with a proposed investment of US$ 34 million.

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Forest map of MPForest-based industries

• Madhya Pradesh has a forest area of 94,689.38 sq km, which accounts for nearly 31 per cent of the area of the state.

• With a share of nearly 13 per cent of the total forest area of the country, MP has the largest area covered by forest among all the states in India.

• Forest-based industries are key contributors to the economy of the state and also provide employment to a large part of the population.

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

• The total growing stock (volume of timber/wood) in MP is 50 million cubic metre valued at US$ 55.5 billion.

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Source: Indiastat.com, Socio Economic Survey

Classification of MP land mass

Reserved 65.36%

Protected 32.84%

Unclassified 1.7%

Forest-based industries

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

• MP accounts for nearly 25 per cent of all Tenduleaves produced in India.

• Sales of forest product generated revenues of US$ 109 million in 2005-2006.

Non forest

69%

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In %

Reserves of important minerals in MP as a percentage of

India‘s reserves

Source: Reserves of important minerals in MP, Directorate of

Geology & Mining, http://www.mp.gov.in/geologyandmining/MP,



Minerals

The state has rich and vast mineral deposits of diamonds, slate, pyrophyllite, diaspore, coal, limestone, copper ore and manganese among others. Besides, the state also has favourable geological and geotectonic settings.

• Active mining of these minerals is generating revenue of more than US$ 200 million per annum.

• MP is the sole producer of diamonds in India.

• It has 69 per cent of the total national reserves of copper ore.

• The thickest coal seam (135 m) of Asia is found at the Singrauli coalfield in Sidhi district.

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Mineral-based industry

No. of units

Location

Cement 8Rewa, Satna, Damoh, Katni,Neemuch

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

Hydrated lime 25 Katni and Satna

Slate pencil 155 Mandsaur

Roofing (Manglore) tiles

8 Hoshangabad, Balaghat

Source: Mineral based industries in MP, Directorate of Geology & Mining,

http://www.mp.gov.in/geologyandmining/ MP, accessed 24 September 2009

Revenues from minerals (2006–07)

Minerals US$

(in ‗000)

Minerals US$

(in ‗000)

Coal 134,629 Pyrophyllite /Diaspore

111

Limestone 32,173 Fire clay 82

Copper Ore 4,973 Laterite 115

Manganese 1,200 Calcite 57

Diamond 336 Shale slate NA

Dolomite 243 Kaolin 13

Bauxite 336 Ocher 20

Rock phosphate

97 Other minerals

1,545

Source: Reserves of important minerals in MP, Directorate of

Geology & Mining, http://www.mp.gov.in/geologyandmining/ MP,


Minerals

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Projected demand for energy in the state

Power sector

Ultra Mega Project in MP

• The Central government is setting up Ultra Mega Power Projects in five locations in the country. The first project is coming up in MP.

• Sasan, a pithead location based on domestic coal availability, has been identified for setting up this project.

• The project would require an investment of about US$ 3.3 billion.

• Super critical technology will be used in this project to ensure higher efficiency and lower CO2 emissions.

in M

WH

Source: Madhya Pradesh Electricity Regulatory Commission

(MPERC)

36




Power sector

Drivers for this sector

• Exemption from electricity duty, sales tax benefits, land incentives offered

• Investors have the option of utilising the power as captive power and selling it to the MPEB at US$ 0.05 per unit.

• Government also provides incentives for setting-up captive plants in the state

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Proposed projects

Thermal power projects

Malwa TPS Purni, District Khandwa 2X500 MW

Essar Group ProjectMahan coal field at Sidhi-Singrauli fields 1000MW

Jaypee Group Siddhi 1000 MW

Hydel power projects

Marhikheda Hydro Project (extension) Shivpuri 1x20 MW

Tawa HEP (M/s Hindustan Electro

Graphite)Hoshangabad 13.5 MW

Coal bed methane

Reliance Energy Shahdol -

Major private players such as Reliance, Essar and the Jaypee Group have acknowledged the potential of MP and plan to invest in the state

Power sector

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Key players

• The state is home to around 1,800 companies and 19 industrial growth centres that are located near major cities. This makes good social infrastructure easily accessible to industrial units.

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

• MNCs such as Cadbury India Ltd, Bridgestone Corporation, Hindustan Lever Ltd, Coca Cola India and Indian companies such as Ranbaxy Laboratories Ltd, Tata Group, Grasim, Hindustan Motors, Eicher Motors Ltd, Kinetic Engineering Ltd, Raymond Group, Ruchi Soya Industries Ltd, Lupin, Crompton Greaves Ltd, Godrej Group, among others are present in the state.

• These companies also export a variety of products and services to both developed and developing countries.

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Key players

ACC Ltd

• ACC is one of the largest cement manufacturing companies in India, with a cement production capacity of 16 million tonnes per annum.

• ACC is a pioneer in cement and ready-mix concrete (RMC)

• The company has a countrywide distribution network and manufactures all types of cement.

• In Madhya Pradesh, the company has a 1.7 million tonnes per annum (MTPA) cement plant at Kymore.

• In 2009, ACC was allotted coal blocks in the state.

Cadbury India Ltd

• Cadbury India is a subsidiary of Cadbury Schweppes, the world‘s largest confectionery and third-largest soft drinks company.

• In 2008, Cadbury India recorded sales of over US$ 364 million.

• The company employs nearly 2000 people across India.

• Cadbury India has one of its main production plants at Malanpur, near Gwalior.

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Key players

Coca Cola India Nicholas Piramal India Ltd

• Coca-Cola India, one of the largest companies in the beverages market, has invested more than US$ one billion in India over the past decade.

• In Madhya Pradesh, Coca-Cola has a plant at Pilukhedi in Raisen district, near Bhopal.

• It is one of India‘s leading pharmaceutical and healthcare companies.

• NPIL ranks fourth in sales of domestic formulations and second in overall sales of domestic pharmaceuticals.

• Its Pithampur plant in Madhya Pradesh is accredited by reputed organisations such as Allergan, Novartis, Solvay and VAX.

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Key players

Procter & Gamble Eicher Motors Ltd

• Procter & Gamble, India is one of the most established and fastest growing FMCG companies in the country.

• The company‘s turnover in 2007-08 stood at over US$ 150 million.

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

• Eicher Motors, part of the US$ 424 million Eicher Group, is a major player in the Indian automobile industry.

• It manufactures and markets commercial vehicles with Gross Vehicle Weight (GVW) ranging between five to 25 tonnes, and is one of the leading manufacturers of commercial vehicles in India.

• It has a manufacturing facility at Pithampur, Madhya Pradesh. This state-of-the-art plant has a total area of 72 acres with 18,000 sq mtas the covered area.

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

• It recently invested US$ 22 million for the manufacture of heavy commercial vehicles at its Pithampur plant.

http://www.pg.com/en_US/index.jhtml

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Key players

Birla Corporation Ltd

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

• The company‘s main areas of business include jute, cement, synthetic yarn, calcium carbide, industrial gases, PVC coated fabrics, PVC floor coverings, auto trims, healthcare and education.

• Birla Corporation has joint ventures and collaborations with world leaders such as DLW AG of Germany, Rhone Poulenc of France, Sweden-based Ericsson Cables AB, GE,Toshiba and AEI Cables.

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44

Key approvals required


DOING BUSINESS IN MADHYA PRADESH

List of approvals and clearances required Departments to be consulted

Prior to setting up the unit

Registration District trade and industries centre

Allotment of land/shed District trade and industries centre

Permission for land use District authorities

No objection certificate under Water and Air Act Madhya Pradesh Pollution Board

Approval for construction activity and building plan Development authority

No objection certificate Fire department

Provisional trade tax registrations Central and state excise departments

Registration under Central Sales Tax Act 1956 Central and state excise departments

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Key approvals required

List of approvals and clearances required Departments to be consulted

Before commencement of production

No objection certificate under of Water and Air Act Madhya Pradesh Pollution Board

No objection certificate Fire department

Permanent trade tax registration under Central Sales Tax Act

1956 Central and state excise departments

Registration under Central Sales Tax Act 1956 Central and state excise departments

After commencement of production/activity

Registration Industries department

46



Business climate of the state

Third-largest producer of cement

in India

12 blocks with reserves totalling

2,585 million tonnes of coal have

been identified

Largest producer of pulses and

oilseeds in the country

31 per cent of the state is under

forest cover with a largely

unexploited species of rare, valuable

medicinal-herbal plants.

Over 2,000 Km of roads being

developed with Private

Partnership (BOT)

Over 18,000 technical graduates

and 230,000 graduates added to

workforce each year.

Over 144 billion cubic metres

(BCM) of coal bed methane

reserves available

Over 100 agricultural farms with an

area of over 20,000 acres is available

on lease to investors

Indore has India‘s first operational

Greenfield SEZ.

Favourable climatic

conditions for growing

cotton and over 40,000

power-looms driving the

textile industry

Availability of coal and natural gas (G.A.I.L

pipeline) along with support from the

government to make investment in thermal

power plants lucrative

Offers diverse tourist destinations catering to

various segments of tourism such as religious

(Bhojpur), eco/adventure (Panchmarhi),

heritage tourism (Sanchi, Khajuraho) etc.

Various blocks

available for power,

cement, iron and

steel units

47









48


OVERALL STATE COMPETITIVENES

Advantage Madhya Pradesh

Mumbai

(780 Km)

(MPV - 1000) Pune

(800 Km)

(MPV - 206.51)

Bangalore

(1400 Km)

(MPV - 254.52)

Chennai

(1430 Km)

(MPV - 362.84)

Hyderabad

(840 Km)

(MPV - 257.9)

Delhi

(740 Km)

(MPV - 789.5)

Ahmedabad

(570 Km)

(MPV - 220.63)

Kolkata

(1350 Km)

(MPV - 613.19)

Key markets

(Distance from Bhopal)

MPV – Market Potential Value

Being centrally located, the state is easily accessible for

all the key consumer markets in the country.

Destination - Madhya Pradesh

Fastest mover in overall

performance among the large

states in the country.

Fastest mover in agriculture.

Fastest mover in infrastructure

development.Ranks second in terms of

governance.

Ranks third in terms of law

and order.

Cost of skilled labour is US$

2.4/day vis-à-vis US$ 3.5 to

4.0/day in metros.

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

49



Advantage Madhya Pradesh

Comparison of time to start a business (days)

Source: Doing Business in India 2009, by World Bank and

International Finance Corporation

Comparison of cost to start a business

(% of income per capita)

Source: Doing Business in India 2009, by World Bank and International

Finance Corporation

50



Parameter

Opportunities in different industries

Tourism

IT-based industries

Food processing industry

Pharmaceuticals and biotechnology

Agro-based industry

Minerals-based industry

Engineering industry

Chemicals industry

Handloom and handicrafts sector

Policy incentives

Setting up and carrying out business

Industrial infrastructure - existing and proposed

Power

Transportation

Industrial estates/areas

STP/IT parks

High

Medium

Low


51

Parameter Madhya Pradesh

Industrial infrastructure-existing and proposed

EPZ

IIDC

Industrial growth centre

Food Processing Park




High

Medium

Low

52


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