INDIAN STATES Economy and Business Andhra Pradesh · largest city in India and has emerged as a leading centre for the IT/ITeS industry. Visakhapatnam, Andhra Pradesh’s main port,

��

INDIAN STATESEconomy and Business

Andhra Pradesh

��

ANDHRA PRADESH PAGE 3

CONTENTS

Socio-Economic Profi le 5

Economic Growth Trends 5

INFRASTRUCTUREPhysical infrastructure 7Urban infrastructure 8Telecommunication 10Virtual infrastructure 11Biotechnology & Pharmaceuticals 12Industrial infrastructure 13

POLICIES & INITIATIVESInformation technology policy 17Electronic Hardware policy 18Food processing policy 19

BUSINESS OPPORTUNITIESPharmaceuticals & Biotechnology 20Apparel and textiles 21Leather industrial park 23Gems & Jewellery industry 24Mines & Minerals 25Health care 26Key investments 30Manufacturing 32

DOING BUSINESSKey apporvals required 34Average cost of doing business in the region 37

OVERALL STATE COMPETITIVENESSMethodology 38

A report by Ernst & Young for IBEF

Andhra Pradesh (AP), located in the southern part of India, is the fourth largest state by area and fi fth largest by population. It is bordered by Maharashtra, Chhattisgarh and Orissa in the north, the Bay of Bengal in the east, Tamil Nadu in the south and Karnataka in the west.

Covering a total area of 275,068 sq km, Andhra Pradesh is the largest state in peninsular India. Its population of 82.7 million makes it the most populous among the southern states. It has the second-longest coastline of 970 km in the country; two ma-jor rivers, the Godavari and the Krishna, cut across the state.

It is endowed with diverse physiographic features, ranging from high hills, undulating plains to a coastal deltaic environment. Be-ing a part of peninsular India, a typical tropical climate with hot summers and relatively pleasant winters prevails in the state.

Andhra Pradesh was formed on November 1, 1956, by combin-ing the old princely state of Hyderabad with the Telegu-speaking parts of the former state of Madras. Major languages spoken in the state are Telegu, Hindi, Urdu, and English.

The strategic position of the state, which features among the fi ve most progressive of India, offers numerous advantages and has positioned it as a transit hub for south Asia. Andhra Pradesh is easily accessible with a well-laid road and rail network. In-ternational airports and seaports provide easy connectivity to different parts of the globe.

Andhra Pradesh has witnessed unprecedented industrial growth in recent years. This is reinforced by the availability of skilled manpower, enabling infrastructure and favourable policy and institutional framework provided by the state government.

The state has a strong network of educational institutions and every year over 98,000 engineering graduates, 12,000 manage-ment graduates and 350,000 other graduates pass out from the various institutions of higher education. Prominent institu-tions include Hyderabad University, Osmania University, Andhra

Pradesh Agricultural University, The Indian School of Business (ISB) and the Indian Institute of Information Technology (IIIT).

The state offers immense business opportunities across vari-ous segments such as information technology, biotechnology, pharmaceuticals and construction. Andhra Pradesh has 272 industrial estates and 71 out of 500 top global corporates have their presence in the state. A number of homegrown groups such as Satyam Computers, GVK, Nagarjuna and Dr Reddy’s Laboratories have emerged as major players both domestically and internationally.

Besides Hyderabad, the state capital, many other cities have emerged as major trade centres. They include Visakhapatnam, Vijaywada, Guntur, Kakinada and Nellore. Hyderabad is the fi fth largest city in India and has emerged as a leading centre for the IT/ITeS industry.

Visakhapatnam, Andhra Pradesh’s main port, is home to the Indi-an Navy’s Eastern Naval Command. The city’s shipyards, fi sheries, docks, and steel works have made it an economic powerhouse. Vijayawada is a major business centre and also a prominent rail-way junction. Tirupati, home to the famous Venkateswara temple, is a major pilgrimage centre. Guntur is the heart of the tobacco industry.

Nellore is famous for its seafood, rice and mica industry, and is also home to the Indian Space Research Organisation’s main launch centre, the Satish Dhawan Space Centre at Sriharikota. Kakinada is the hub of natural gas exploration.

The Krishna and Godavari rivers together irrigate thousands of square km of land, and create the largest perennial cultivable area in the country. Dubbed India’s Rice Bowl, Andhra Pradesh leads in the production of rice (paddy).

INDIA

Andhra Pradesh

Hyderabad

ANDHRA PRADESH: AN INTRODUCTION


Andhra Pradesh has 23 districts, 7 municipal corporations, 81 revenue divisions, 1,128 mandals, and 21,900 gram panchayats.

Population

India’s fi fth most populous state accounts for 7.43 per cent of the total population of the country (in 2001, as against 7.9 per cent in 1991). The decadal growth rate during 1991-2001 was 14.59 per cent, which is lower than India’s overall decadal growth rate of 21.53 per cent.

It has a population density of 277 persons per sq km as against the national fi gure of 313. The population density level of Hyderabad is the highest in the state – at 19,149 persons per sq km.

The sex ratio stands at 978 females per 1,000 males (all-India fi gure: 933 females per 1000 males).

Literacy rate

The literacy rate in Andhra Pradesh in 2001 was 60.47 per cent (national average: 64.84 per cent) as against 44.08 per cent in 1991. Male literacy is 70.32 per cent, while the female literacy is 50.43 per cent. Hyderabad has a literacy rate of 78.80 per cent.

Urbanisation

Urban population accounts for 27.3 per cent of the total popula-tion (in 2001, as compared to 26.89 per cent in 1991).

As per the advance estimates for 2006-07, the Gross State Domestic Product (GSDP) at constant prices was expected to touch $49.29 billion. During the 1980s, the stage averaged a GSDP growth of 6.03 per cent, higher than India’s GDP average of 5.68 per cent in the same period. During 2002-2007, Andhra Pradesh’s GSDP growth averaged 6.8 per cent. The state is targeting 9 per cent annual growth during the Eleventh Five Year Plan period (2007-12).

Per capita income at constant prices has increased from $421 in 2001-02 to $519 in 2005-06 registering a growth of

5.85 per cent.

A comparative study of the sectoral composition of GSDP reveals that the share of the primary sector declined from 31.47 per cent in 1999-2000 to 26.65 in 2006-07. The secondary sector’s contribution has remained almost the same hovering around 22 per cent. However, the share of the tertiary sector has increased from 47.2 per cent to 51.78 per cent from the base year.

Distribution of Population by Age Groups, Andhra Pradesh, 2001 (mn)

Age Group Rural Urban Total

0-4 5,012,932 1,671,429 6,684,361

5 to 14 13,141,553 4,572,211 17,713,764

15 to 19 5,263,858 2,316,106 7,579,964

20 to 24 4,796,962 2,139,935 6,936,897

25 to 29 4,779,944 1,982,327 6,762,271

30 to 34 4,020,132 1,605,373 5,625,505

35 to 39 4,035,189 1,617,522 5,652,711

40 to 49 5,897,425 2,261,468 8,158,893

50 to 59 3,868,354 1,305,759 5,174,113

60 to 69 2,883,813 825,463 3,709,276

70 to 79 1,235,889 338,603 1,574,492

80 + 386,032 118,278 504,310

A.N.S** 78,984 54,466 133,450

All Ages 55,401,067 20,808,940 76,210,007 Source: Registrar General of India, Ministry of Home Affairs, New Delhi

* Age Not Stated

SOCIO-ECONOMIC PROFILE

GSDP 2000-2007(USD Billon)

0

10

20

30

40

50

60

70

2000-01 2001-02 2002-03 2003-04 2004-05 (P ) 2005-06 (Q )

2006-07 (A )

US$

bn

Constant Prices Current Prices

Source: Directorate of Economics & Statistics, AP

Employment Distribution across Sectors

Andhra Pradesh had a total of 22,339 establishments employing two million people in the organised sector as on March 2006, of which 14,171 (with 1.37 million employees) were in the public sector. According to the employment statistics in the organized sector in the State, the total number of employees went up to two million by March 2006.

Percentage wise distribution of employment across sectors

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2005Public

2005Private

2005 Total 2006Public

2006Private

2006 Total

Agriculture Hunting Forestry & Fishing Mining & Quarrying

Manufacturing Electricity Gas and water

Construction Wholesale and Retail Trade Restaurants and Hotel

Transport Storage and Communications Finance Insurance Real Estate and Business services

Community Social and Personal Services

Source: Socio Economic Survey, Andhra Pradesh, 2007

Industry-wise Employment in Andhra Pradesh, 2005-2006

NIC Code7 Industry 2005

(‘000) 2006 (‘000)

0 Agriculture Hunting Forestry & Fishing 30.40 29.90

1 Mining & Quarrying 76.90 323.30

2&3 Manufacturing 483.30 210.20

4 Electricity Gas and water 43.10 95.60

5 Construction 63.20 47.60

6Wholesale and Retail Trade Restaurants and Hotel

38.30 371.20

7 Transport Storage and Communications 259.50 408.70

8Finance Insurance Real Estate and Business services

1007.20 470.30

9 Community Social and Personal Services 40.90 44.60

Total 2042.80 2001.40



INFRASTRUCTURE

Physical Infrastructure

Transportation

The Andhra Pradesh State Road Transport Corporation (APSRTC), the largest state road transport undertaking in the country, was formed in 1957. As on March 2006, it had a fl eet 19,407 buses. The corporation carries 12.8 million passengers daily.

Roads

There are 15 national highways in the state covering a length of 4,648 km. Of this, 1,125 km are four-lane and 3,158 km are two-lane.

Railways

The South Central Railway covers a 4,752 km-long network in the state and its neighbouring areas. Headquartered in Secun-derabad, the network comprises 3,754 km of broad-gauge and 508 km of metre-gauge railway lines. The South Central Railway transports goods such as coal, iron ore, cement, food grains, fertilisers, minerals, petroleum prod-ucts, and general merchandise.

Hyderabad also has a Multi-Modal Transport System (MMTS), which commenced operations in August 2003.

Airports

The State has an international airport at Hyderabad and domes-tic airports at Visakhapatnam, Tirupati, Rajahmundry, Warangal, Vijayawada, Donakonda, Kadapa and Puttaparthy.

The state capital is connected to major international destina-tions such as Amsterdam, Bangkok, Chicago, Frankfurt, Dubai,

Singapore, Sharjah, London and Kuala Lumpur.The Proposed Hyderabad International Airport

The recently inaugurated Hyderabad International Airport at Shamshabad was developed under the Public Private Partnership (PPP) model. The airport has been developed on a 5,450-acre plot. An international airport has been planned for Visakhapat-nam.

Ports

The cargo handled by ports in Andhra Pradesh is the second highest among Indian states. Besides the major port of Visakha-patnam, Andhra Pradesh has two intermediate ports and 10 minor ports. With increasing trade especially in dry bulk cargo traffi c with China and other Asian countries, there has been substantial increase in cargo movement from the east coast.

Visakhapatnam port handles more than 60 million tonnes of cargo per year. The port has 13 multi-purpose berths and 7 specialised berths.

Gangavaram is a satellite port in Visakhapatnam, currently being developed by the state government as an all-weather facility. It would be the deepest port (215 metres) in India, with round-the-clock operations and state-of-art cargo handling equipment.

The state government plans to develop Bheemunipatnam port (also in Visakhapatnam district) on a Build Operate Own (BOO) basis for building ships and handling cargo.

Kakinada anchorage is a sheltered port and handles about 150-200 seagoing ships every year. The port handled a record cargo of 2.83 million tonnes during 2005-06. Kakinada deep-water port handled a record cargo of 13 million tonnes during 2005-06.

Rawa port is located in East Godavari district with an offshore

RailwaysUnits - Kms

Division Broad Guage Meter Guage TotalSecunderabad 1274 0 1274Vijayawada 890 0 890Guntakal 1046 373 1419Hyderabad 443 126 569Guntur 591 0 591Nanded 458 544 1002TOTAL 4702 1043 5745

Source: Commissionerate of Industries, Andhra Pradesh

NEW AIRPORT OLD AIRPORT PHASE1

(MAR2008) PHASE 2 AREA 2400 acres 5450 acres TOTAL MOVEMENTS (per month) 6,338 9000 PARKING BAYS 21 42 AERO-BRIDGES 12 24 PASSENGER CAPACITY 5.6 million 12 million 40 million CARGO CAPACITY

RUNWAYS 1 runway, Length-3650 metres

1 runway, Length- 4260 metres 2 runways

AIRLINES (Domestic,International)

9 Domestic, 12 International

11 Domestic, 12 International

Source: Airport Authority of India, GMR

single buoy mooring system for collecting offshore oil from six oil rigs in the Rawa basin.

Machilipatnam port, in Krishna district, is a medium fi shing harbour which can accommodate 350 fi shing vessels. A feasibility report has been prepared for the development of a deep water port at Goguleru creek near Machilipatnam.

Krishnapatnam port is the fi rst greenfi eld port in Nellore dis-trict and was privatised in 1997. Commercial operations would commence by June 2008.

The government plans to develop an all-weather port with pri-vate partners at Nizampatnam in Guntur district.

Urban Infrastructure

Data relating to urban infrastructure – in terms of water supply, sanitation facilities, solid waste management, and transportation facilities – has been gleaned from the City Development Plans (CDP) prepared under the Jawaharlal Nehru National Urban Renewal Mission .

Water Supply

The average per capita water supply in major cities is 106 lpcd (litres per capita daily), which is lower than the desired 150 lpcd. Hyderabad and Visakhapatnam have low per capita supplies, but Vijayawada has adequate supply of water.

In terms of the average percentage of service coverage of the water supply system, cities have achieved high coverage of 85-90 per cent in core areas. The coverage of water supply in the surrounding areas, however, is relatively low and varies between 20-65 per cent. Operation and maintenance costs being recov-ered through water tariffs is high (85 per cent) in Hyderabad, and is negligible in all other cities in Andhra Pradesh. These cities face the problem of cost recovery, as the tariffs are either low or non-existent.

Sewerage System and Solid Waste Management System

All the major cities in the state have proper sewerage systems in place. In the major cities, the area coverage of the sewer-age system varies from 10-45 per cent as depicted in the graph below. However, the percentage of sewage treated is rather low and varies from 10-22 per cent.

The solid waste collection effi ciency is very high across most cities of Andhra Pradesh and varies from 85-100 per cent on an

Densities of Cities in Andhra Pradesh

-2,0004,0006,0008,000

10,00012,00014,00016,000

Hyderabad Vijayawada Vishakapatnam

Per

sons

per

Sq.

Km

.

Average for Indian Cities

Per Capita Water Supply in Various Cities in AP (lpcd)

-

50

100

150

200Hyderabad

VijayawadaVishakapatnam

Desired Level Current Per Capita Supply- litres/day

Source: City Development Plans

Percentage Area Coverage of Sewerage System and Percentage SewageTreated in cities of A.P.

05

101520253035404550


Perc

enta

ge

Area Coverage (%) Treated (%)


Solid Waste Collection Efficiency in cities of A.P.

80

85

90

95

100Hyderabad

VijayawadaVishakapatnam

Desired Efficiency (%) Collection Efficiency (%)



average for all the cities, with Visakhapatnam having the maxi-mum effi ciency of 100 per cent. While other cities in the state scientifi cally dispose of only certain portions of their waste, Visakhapatnam is one of the few towns in India where 95 per cent of its solid waste is disposed of in a scientifi c manner. Roads and Storm Water Drainage

The state’s per capita urban road length is lower than the desired minimum of 1.25 km per person. Even in Visakhapatnam, which tops the list, it is just 1.03 km. The percentage of pucca roads in cities varies from 70-95 per cent (compared to the all-India average fi gure of 90 per cent).

The percentage coverage of storm water drains along roads var-ies from 30-50 per cent.

Financial Health of ULBs

An analysis of the revenue income and expenditure statements of Urban Local Bodies (ULBs) for all the major cities indicates that the per capita revenue income is high compared to ULBs in other cities in India. The average per capita revenue income in Indian cities is $25 per year. This varies from $27-38 per year in the major cities of Andhra Pradesh. The major component of revenue income is property tax. There is less dependency on grants. Hyderabad and Visakhapatnam have low percentage income from the grants; however, Vijayawada has 52 per cent of its revenue income being derived from grants.

Power

Andhra Pradesh has had a consistently strong track record in the power sector as it is able to leverage a mix of thermal, hydro and gas. Availability of huge resources of coal, perennial rivers with good monsoons and the recent huge natural gas fi ndings in Krishna-Godavari basin are some of the major factors that have

Per Capita Revenue Income of ULBs in cities of A.P.

05

1015

2025

3035

40


US

D/pe

rson

/yea

r

Per capita Revenue Income (USD)

Source: City Development Plan

Source- AP GENCO.

0

5000

10000

15000

20000

25000

2002 2003 2004 2005 2006

Uni

ts -

MU

Thermal Hydel

Source: Commissionerate of Industries, Government of Andhra Pradesh, 2006

allowed the state to supply quality power at highly competitive prices.

Andhra Pradesh would be able to ensure supply of uninterrupt-ed quality power of adequate quantity to prospective investors, thanks to the new gas discoveries. For major investment proj-ects, 200 express feeders are monitored on a day-to-day basis to ensure the above.

To meet the growing demand for power, the government has been encouraging projects in the state. It plans to add 11,987 MW during 2007-2012, of which 5,694 MW would be under the state sector, 2120 MW would be under the central sector, 864 MW under the private sector (gas-based projects), 309 MW would be non-conventional energy projects, 1,400 MW would be irrigation department projects and 1,600 MW would be an ultra mega project.

Social Infrastructure

School Education: The pattern of school education followed in Andhra Pradesh is 5+2+3 – fi ve years of primary educa-tion, two years of upper primary education, and three years of secondary education. Of a total of 94,984 schools in the state, 62,159 are primary schools, 17,290 are upper primary schools, 15,437 are high schools and 98 are higher secondary schools.

Intermediate Education: At the intermediate stage of educa-tion, conventional courses in science, arts and commerce and 33 vocational courses are being offered across 814 junior colleges.

Degree Colleges: The Department of Collegiate Education monitors the administrative functions and academic quality in 178 government and 179 aided colleges with an enrolment of 423,664 students in 2006-07.

Technical Education: The Technical Education Department in Andhra Pradesh supports 1,004 technical institutions, including 862 at the degree level.

Telecommunications

AP Broadband Network

The government has embarked on a plan to have a reliable com-munication back bone, capable of Gigabit Ethernet connectivity between all government departments and offi ces. The network is expected to have optic fi ber connectivity right up to the village level. It would connect the secretariat to district headquarters, mandals and villages, bringing the information super highway to the door step of the common man in the rural areas. The AP Broadband network is under implementation with private par-ticipation. It would connect the state headquarters with 10 Gbps to each district headquarter, 1 Gpbs to each of the 1,128 mandal headquarters, and 100 Mbps to each of the villages.

Industrial Infrastructure

The governmrent has identifi ed certain focus sectors such as pharmaceuticals, biotechnology, food processing, chemicals, marine, leather, textiles, information technology and communica-tions, and hi-tech manufacturing, to accelerate industrial growth in the state, by way of creating world class infrastructure.

The Andhra Pradesh Industrial Infrastructure Corporation (APIIC) is the body responsible for the development of indus-trial infrastructure in the State.

Special Economic Zones

Technical Colleges and Seats in 2006-07

Course No. of Institutions

No. of Seats

Engg. 282 98,475 MCA 270 15,215 MBA 206 12,415 B.Pharmacy 104 6,045 Polytechnic 142 24,095

Source: Technical Education Department

Upcoming SEZs in the State

Source: http://sezindia.nic.in


The Government of India has granted approval to 54 special economic zones (SEZs) to be developed in the state. While 11 SEZs are to be developed by the government, the remaining will be developed by private investors.

An export promotion industrial park (EPIP) is being set up by APIIC at Pashamaylaram village in Medak district, on a 204-acre plot, at a cost of $145 million. The state government will provide $35.36 million as equity.

Integrated Infrastructure Development Centres (IIDCs) are be-ing developed to establish industries in rural/backward areas and to provide strong linkages between agriculture and industry.

Critical Infrastructure Balancing Scheme (CIBS) is meant to fund industrial associations, service societies and NGOs for develop-ment of critical infrastructure. The scheme would also upgrade water supply systems, power networks, roads and effl uent treat-ment plants.

The government has also introduced the Industrial Infrastruc-ture Development Fund (IIDF) to ensure water for drinking and industrial use, electricity, telecommunications, drainage, roads and common effl uent treatment plants.

Physical Infrastructure

APIIC and Larsen & Toubro (L&T) have developed an infocity spread across 158 acres at Madhapur. The project covers three phases: Phase I: Cyber Towers, completed in November 1998, spans over 6 acres with a built-up space of 525,000 sq ft, employing 5,000 people.

Phase II: Cyber Gateway developed in January 2003; covers 8.65 acres with 783,000 sq ft built-up space employing 7,500 people.Phase III: Cyber Pearl covering 500,000 sq ft built-up space; over 6.05 acres and built in October 2004.

Key tenants at the complex include Microsoft, Oracle, HSBC, Dell, Convergys, Value Labs, Satyam and Tata Teleservices.

Virtual infrastructure To help citizens gain one-stop secure access to information and services and to provide better, effi cient, transparent and responsive services by leveraging information and communica-tion technology tools, the state government has embarked upon implementation of several e-governance initiatives.

E-Seva:• E-seva provides a one-stop venue for services of various

state and central government departments in an effi cient, reliable, transparent and integrated manner on a sustained basis. This is carried out through a chain of Integrated Citizen Service Centres.

• It provides online transaction processing of payments, issue certifi cates, permits, licenses and many other services.

Rajiv Internet Village:• Launched in August 2004, its objective is to bring govern-

ment services/benefi ts closer to people living in the villages.• It aims to provide computer literacy to at least one person

in each family in rural areas.• It provides connectivity to rural areas with high bandwidth.

AP Online:• An e-governance gateway for the state government to offer

multiple services, through a single window to its citizens.• It has been developed and launched by the government in

partnership with Tata Consultancy Services.• It facilitates online submission of forms including registra-

tions, licenses, permits, certifi cates and representations to different government departments.

• It facilitates online payments of utilities, taxes, fees, deposits, and stamp duties.

E-ProcurementIt automates the procurement and purchase procedures of the state government spanning from demand aggregation to pro-curement and fulfi llment.The objective of the project is to leverage IT tools to introduce

,

Upcoming IT Projects

Type Location Area (Acres) Project Cost (INR)IT PARK Manikonda 100 1158IT PARK Rayadurg 37.5 600IT SEZ Nanakramguda 20.53 -

IT/ Industrial Park Adibatla 744 -Source: Commisionerate of Industries, Andhra Pradesh, 2006

best practices in electronic procurement across government departments. At present, the portal is servicing 12 departments, 19 public sector undertakings, 4 universities, and 67 urban local bodies.

IT Hardware Industry To provide thrust to the hardware industry, the government of Andhra Pradesh has demarcated 5,000 acres of land near the international airport for a hardware park.

Salient features:• State-of-the-art infrastructure (power, water, telecommunica-

tion, roads, effl uent treatment systems, sewerage systems, transport network).

• Integrated Logistics hub (warehousing, container depots, distribution facilities, multi-modal transportation facilities and high speed customs clearances).

• Integrated township (housing, hotels, club houses, recreation and sports facilities).

Videocon International, HCL Infosystems, Celetronixs, Catalytic Software and Astra Microwave have established their presence at the park.

APIIC is developing another hardware park on a 1,109-acre plot (200,000 sq mt proposed built-up area) in Ranga Reddy district at a cost of $487.4 million. An area of 168.27 acres has been al-lotted to companies such as HCL Infosystems, Astra Microwave Products, Catalytic Software and Millennium Appliances.

Biotechnology & Pharmaceuticals

The state government has identifi ed biotechnology and pharma-ceutical sectors as engines for economic growth and has taken steps to encourage sustainable growth within these sectors.

Genome Valley is India’s fi rst state-of-the-art biotech/pharma cluster providing infrastructure to over 100 biotech/pharma companies. Spread over 600 sq km near Hyderabad, the complex is a natural, geographical cluster for biotech research, training, collaboration, and manufacturing activities.

It houses ICICI Knowledge Park and Shapoorji Pallonji Biotech Park, India’s fi rst operational knowledge park and biotech park respectively. It has all the critical success factors such as excel-lent infrastructure and research facilities, skilled workforce, venture capital funding, proximity to related supplier networks, and proactive government support.

The companies that have set up their operations in the biotech park include Albany Molecular Research Inc, Mithros Chemicals, Chanelle Pharmaceuticals, and NND Biomedical Data Systems Pvt. Ltd. India’s leading biopharmaceuticals companies such as Shantha Biotech, Bharat Biotech, GVK Biosciences and Dr. Reddy’s are based in Genome Valley.

Eighteen companies are located in the 200-acre ICICI Knowl-edge Park, which also houses a centre for business-driven research, a life sciences incubation centre, IPR and patent facilita-tion cell, besides other enabling infrastructure.

Shapoorji Pallonji Biotech Park, built on a public private partner-ship (PPP) model, is spread over 400 acres; 23 companies are located in the fi rst two phases of the park.

Agri-Science Park

The state government and ICRISAT (International Crop Re-search Institute for the Semi-Arid Tropics) have jointly set up an Agri-Science Park at the ICRISAT campus to support the growth of agri-based biotech industry in the state.

Jawaharlal Nehru Pharma City SEZ

The government and Ramky Pharma City (India) Ltd have devel-oped a 2,200-acre pharmaceutical city at Parwada, Visakhapat-nam district, at an estimated cost of $73.17 million.

Andhra Pradesh houses a large network of research laboratories:

• The Centre for Cellular and Molecular Biology (CCMB),• Centre for DNA Fingerprinting and Diagnostics (CDFD), • Indian Institute of Chemical Technology (IICT), • International Crop Research Institute for Arid and Semi-Arid

Tropics (ICRISAT), • Directorate of Rice Research (DRR) and other specialised

agro-research centres of the Indian Council of Agricultural Research (IARI),

• National Academy of Agricultural Research Management (NAARM),

• National Institute of Nutrition (NIN), • Dr. Reddy’s Research Foundation (DRF), • Aurobindo Research Centre, • Hyderabad Eye Research Foundation, • Institute of Genetics and Hospital for Genetic Diseases and • The Life Sciences departments of the University of Hydera-

bad and of Osmania University.


Apparel and Textiles

Dedicated infrastructure has been set up in the state to drive the growth of apparel and textiles sector, attracting foreign direct investment (FDI) from the US and the UK.

The 176-acre Apparel Export Park, Gundlapochampally, Ranga Reddy District, is equipped with modern facilities. Several com-panies are exporting products to the US and the UK and their clientele includes Wal-Mart and JC Penny.

A 146-acre Apparel Export Park has been developed in Visakha-patnam. Another 60-acre Textile Park has been developed in Sircilla in Karimnagar district. The government has also identifi ed a 50-acre plot for a Handloom Apparel Park at Pochampally in Nalgonda district, near Pochampally Silk City.

The central government has approved a Textile Park at Pashamy-laram in Medak district, under its textile centre infrastructure development scheme.

A 180-acre Hi-Tech Park at Kothur in Mahaboob Nagar district, was set up in 2004 at a cost of $101.22 million. It provides direct employment to 5,000 people and indirect employment to 10,000.

A Textile Park has been planned at Pamidi in Anantpur district, to be developed as a natural garment cluster.

A 1,000-acre Brandix India Apparel City has been developed at Visakhapatnam at a cost of $609.75 million by Brandix Lanka Ltd, creating employment for 60,000 persons. Commercial opera-tions began in January 2007.

Industrial Infrastructure of Andhra Pradesh at a Glance

Existing Sector Specific Parks (Mega Business Projects) Location (District)

Name of the Park

Chittoor Food Processing Park Medak Export Promotion

Industrial Park Agri Biotech Park Apparel Park Bio-Tech Park Financial District Gems & Jewelry Park Hardware Park Hi-Tech City Hitex Exhibition Centre ICICI Knowledge Park Industrial Estate for Lady Entrepreneurs International Convention Centre

Ranga Reddy

Mind Space IT Parks AP SEZ JN Pharma Park Visakhapatnam Industrial water supply Project

Visakhapatnam

Visakhapatnam SEZ Source: Commissionerate of Industries, Government of Andhra Pradesh

Industrial Clusters in Andhra Pradesh

IT / ITESPharma / Biotech

Textile & Apparel

Guntur

VishakapatnamHyderabad

Sircilla

Warangal

Nalagunda

Food Processing

Vizianagaram

Bheemavaram

Chittoor

Vijaywada

Automobiles & Engineering

Rangareddy

MAHARASHTRA

KARNATAKA

TAMIL NADU

MADHYA PRADESH

ANDHRA PRADESHIndustrial Clusters

NN

HindupurNellore

Karnool Ongole

Mineral

Khammam

Kuppam

Kadapa

Location Name of the Park (District) Adibatla, Ranga Reddy

IT Park

Anantpur Textile Park Guntur Food Processing

Park Khammam Food Processing

Park Mahabubnagar Textile Park Manikonda, Ranga Reddy

IT Park

Medak Textile Park Nalgonda Handloom Textile

Park Nanakramguda, Rangareddy

IT Park

Nellore Food Processing Park Pharma Cluster Business District & Trade Towers Rajiv Gandhi Nanotech Park SemIndia Fab City Hardware Park Aero Park

Ranga Reddy

Auto Park Sircilla, Karimanagar

Textile Park

Auto Component Vijayawada, Krishna IT Park

Brandix Textile City IT Park Apparel Export Park

Vishakapatnam

Marine biotech park Vishakapatnam, Vizianagaram, East Godavari

PCPIR

Source: Commissionerate of Industries, Government of Andhra Pradesh

Upcoming Specialised Parks


The state government introduced an industrial investment pro-motion policy (2005-2010) common for all industries and a few sector specifi c policies.

Highlights

Objectives• To market the state as a competitive investment destination

for foreign investments• To attract and develop appropriate entrepreneurial leader-

ship, management and HRD systems• To encourage establishment of new small scale industries in

rural areas• To encourage, attract and involve women entrepreneurs for

industry capacity building• To withstand global competition, special emphasis on qualita-

tive competitiveness through technology upgradation and protecting intellectual property rights

• To encourage cluster development and make industries glob-ally competitive across clusters

Strategy• Creation of quality infrastructure – land, power, water, critical

infrastructure, development of industrial corridors, special economic zones

• Incentivising investments – investment subsidy, growth en-abling incentives, credit support, scarce raw materials

• Building industrial competence in women• Quality competitiveness – technology upgradation, quality

promotion• Export promotion • Attracting mega investments – growth enabling incentives,

special package for existing large industries• Attracting foreign direct investments• Access to market• Fostering industry clusters• Prevention of industrial sickness• Preventing migration of talent• Permitting industries to exit• Towards better regulation – single window scheme• Removing barriers to competition• Policy measures – thrust sectors (Bio-technology, Informa-

tion Technology, and Tourism)

POLICIES & INCENTIVES

Incentives provided by the Industrial Investment Promotion Policy 2005-2010

Incentives/ Categories Stamp Duty

Rebate on Land Power

Investment Subsidy

Commercial Tax

Interest Subsidy

Capital Assistance Others

Small Scale Iindustries/Tiny

Units

100% reimbursement on purchase of land for industrial use, lease/shed buildings, financial deals and mortgages

25% rebate in industrial estates/industrial development area limited to USD 12195

Reimbursement @ USD 0.02 per unit during the first year

1) 15% on fixed capital investment subject to max. of USD 36585

2) Additional 5% on fixed capital investment limited to USD 12195 for SC/ST

25% in the first year to be ploughed back by Govt. for payment for next year (for 5 yrs)

3% on prime lending rate on term loan taken by SSI units subject to max. of USD12195/yr for 5 years

5% of project cost to SSI units by SC/ST entrepreneurs limited to USD 12195

1) 8% subsidy on capital equipment on technology up gradation

2) 50% subsidy for quality certification limited to USD 2439.

3) 25% subsidy on specific cleaner production measures limited to USD 12195.

4) 50% subsidy on the expenses incurred for patent registration limited to USD 12195.

Women Entrepreneurs




1) 15% on fixed capital investment subject to max. of USD 36585

2) Additional 5% on fixed capital investment limited to USD 12195 for SSI units and SC/ST

Upto 25% in the first year to be ploughed back by Govt. for payment of next year (for 5 yrs)

1) 5% on prime lending rate on term loan taken by SSI units subject to max. of USD12195/yr for 5 years

5% of project cost to SSI units limited to USD 12195

1) 8% subsidy on capital equipment on technology up gradation




Large & Medium Scale

Industries




1) 15% on fixed capital investment subject to max. of USD 0.04 million

2) Additional 5% on fixed capital investment limited to USD 12195 for SC/ST

25% in the first year to be ploughed back by Govt. for payment of next year (for 5 yrs)




4) Roads, power & water to units contributing 50% of cost of infrastructure from IIDF with ceiling of USD 243,902

Mega Projects

1) Eligible for all incentives for large & medium scale industries

2) Tailor-made benefits on a case to case basis

- - - - - - -

Existing Tiny/SSI/Large

& Meduim Projects

- - - - - - -

1) 50% subsidy for quality certification limited to USD 2439

2) 50 % subsidy on patent registration limited to USD 12195.

Existing Large Industries and Mega Projects

Special package of fiscal benefits on a case to case basis.

- - - - - - -


Single Window Clearance Act

In order to encourage investors and facilitate quick implemen-tation of their projects, Government of Andhra Pradesh has introduced Andhra Pradesh Industrial Single Window Clearance Act, 2002.

Under the single window clearance system, the investors need to fi le common application forms for obtaining all approvals/ clearances, allotments, permissions licenses required for setting up of the industrial units. Most of the clearances are being pro-vided within 30 days to the investor; under the Single Window Clearances Act. It has been made compulsory for all the indus-trial units to fi le the application form for various clearances/ approvals through nodal agencies and no individual department or agency receives any application from the entrepreneur/inves-tor directly.

Highlights of Sector Specifi c Policies

Tourism Policy 2006

Objectives• To create a Unique Selling Proposition and a brand image

for the State to ensure proper positioning and focus for the State on the Indian and world tourism map.

• To create and differentiate tourism products in all sectors such as pilgrimage, heritage, business, sports, eco-tourism, health, leisure, and rural tourism

• To provide incentives and concessions to international stan-dard tourism projects to be set up in Special Tourism Areas, if they assure sustainable employment generation, promote rural tourism, promote commercially unviable projects, etc,

• To develop tourism through Public Private Partnership• To create a single window clearance system

Incentives and concessions• Concessional allotment of land on long lease of 33 years. For

mega projects, lease period exceeding 33 years and lease rent shall be 10% of market value and reviewed every fi ve years

• Investment subsidy of 20% of the project cost limited to USD 48,000

• Investment subsidy of 15% of the project cost limited to USD 48,000 for upgradation of existing hotels

• 100% reimbursement of stamp duty and transfer fee on purchase of land or lease of land meant for the project

• Reimbursement of 25% of Value Added Tax paid for a period of 5 years

• Reimbursement of 25% of Luxury Tax by new hotels for a

period of fi ve years• Reimbursement of 25% of Entertainment Tax for multiplexes

in theme parks and urban entertainment centres for a period of fi ve years limited to 100% of the project cost for the projects more than USD 1.22 million and located in Notifi ed Tourism Areas or Special Tourism Areas

• Floor Area Index relaxation• Automatic conversion/exemption from land use zoning regu-

lations• Capacity development of key stake-holders

Information Technology Policy

Power: IT industry is classifi ed under industrial units for the purpose of levying the industrial power tariff

Rebate on Cost of Land: IT/ITeS companies establishing their own facilities on clear Government land are eligible for a rebate in cost of land calculated at the rate of USD 487.80 per job cre-ated. This rebate in not available on acquired land.

Stamp Duty: 100% reimbursement of stamp duty, transfer duty and registration fee paid by IT & telecommunication companies.

Zoning regulations & special stipulations for IT parks on private land and IT campus: IT/ITeS units are exempt from the zoning regulations and from the payment of conversion fee.

Urban Land Ceiling (ULC) Exemption: Private land own-ers will be allowed exemption under ULC for development of IT parks with a minimum extent of 25 acres in the periphery of city limits and beyond. They will be allowed exemption under the same with a minimum of 5 acres within city limits subject to payment of the prescribed fee.

Training Incentive: An incentive of USD 48.78 per candidate will be provided to training centres, which would successfully train the candidates in communication/soft skills and provide employment in reputed IT/ITeS companies.

Tier-2 Locations:• A subsidy of USD 0.12 million to the fi rst fi ve anchor IT/ITeS

companies employing 250 employees in IT or 500 employees in ITeS in any Tier-2 location

• USD 36,000 as recruitment assistance for employing mini-mum 100 employees in IT and 200 employees in ITeS within two years of commencement in the Tier – 2 cities.

Special Package for Small and Medium Enterprises (SMEs): IT industry units with turnover less than USD 2.43 mil-lion and more than USD 0.24 million per annum.

• Power: 25% rebate on power tariff in the fi rst 3 years of operations and conversion to industrial power tariff.

• Reimbursement of 50% Exhibition Subsidy for participating in international exhibitions limited to 9 square meters of space for the stall rent payable for participation in international events notifi ed by IT&C Department.

• Allotment of land: Government will endeavor to reserve land for preferred allotment to SMEs in other locations. Criteria for allotment will be prepared separately.

• Government will support IT Export Associations, HYSEA (Hyderabad Software Exporters Association), Nasscom (National Association of Software and Services Companies), STPI (Software Technology Parks of India), IEG (Institute of Economic Growth) or any such organization (as decided by the committee) in the creation of libraries for making avail-able materials on trends in technology, market intelligence, research reports, and analysis, etc., by contributing USD 24,000 per annum for development of SME sector by making such material available at these libraries.

• USD 24,000 as recruitment assistance for employing mini-mum 100 employees in IT and 200 employees in ITeS within one year of commencement of commercial operations in Hyderabad and around up to 50 km.

Mega Projects: A special package of incentives will be offered to mega projects. Such projects will be defi ned as projects creat-ing employment of more than 1000 in the case of IT and 1500 in the case of ITeS. An investment above USD 12.20 million will be considered as a mega project.

Information & Communication Technology Policy

Highlights and Objectives:• The State aims to achieve USD 16.82 billion in software

exports and create employment for 300,000 people.• The Government created this policy based on stakeholder

consultations.• Small and medium enterprises have been offered special

packages in the policy. These include rebates and reimburse-ments, cheaper power and recruitment assistance.

• Special packages for mega projects (USD>500 million or 1000-1500 employees) would be offered.

• A Nanotech Park will be setup to encourage R&D and semi-conductor manufacturing.

• An IT Infrastructure Fund will meet the cost of servicing the interests on the loans raised by APTRANSCO (Andhra

Pradesh Transmission Corporation of Andhra Pradesh Ltd.) and Water and Sewerage Board for development of IT parks.

Electronic Hardware Policy

• Exempt from the purview of statutory power cuts.• Exempt from inspections; Self Certifi cation Permitted on

Labour Laws.• Non-Hazardous IT & Electronic Hardware Manufacturing

Industry have been declared as essential services.• Power: IT & Electronic Hardware Manufacturing Industry

shall be classifi ed as industrial units for the purpose of levy-ing the industrial power tariff.

• Stamp duty: 100% reimbursement of stamp duty, transfer duty and Registration fee for all IT & Electronic Hardware Manufacturing Industry in the Hardware Manufacturing Clus-ter Parks (HMCP).

• Supporting Infrastructure: The Government of Andhra Pradesh will provide infrastructure including power, water, sewerage and roads up to HMCP.

• Improving the quality of existing technical education: The Government of Andhra Pradesh will facilitate linkages between Andhra Pradesh based engineering colleges and polytechnic colleges with leading academic institutions of international repute and the industry.

• Linkages between universities and companies: Representa-tives from the IT & Electronic Hardware Manufacturing In-dustry will be included in the Andhra Pradesh State Council of Higher Education and on the Boards of Universities in Andhra Pradesh.

• Patent Filing Costs will be reimbursed to a maximum of USD 4878 on successful attainment of the patents.

• USD 24,000 as recruitment assistance will be paid for employing a minimum of 100 employees within one year of commencement of commercial operation for SMEs in Hyderabad and around up to 50 km.

• USD 36,000 as recruitment assistance will be paid for em-ploying a minimum of 100 employees in Tier-II cities within two years of commencement of commercial operations of the company.

• Government will support ELIAP, ELCINA or STPI (as decided by the committee) in the creation of a Library for making available material on trends in technology, market intel-ligence, research reports and analysis etc., by contributing USD 24,000 per annum by making such material available at these libraries.

• 50% Exhibition subsidy will be reimbursed for participating in international exhibitions limited to 9 sq. mts., of space, in re-spect of the stall rent payable as notifi ed from time-to-time.


Food Processing Policy

Areas that are covered under the policy include horticulture, agriculture, animal husbandry, fi sheries, agro food processing industries, and allied industries:

Incentives and Concessions:• Reimbursement of cost of power for all eligible units shall be

allowed @ USD 0.024 per unit as against USD 0.018 per unit as provided for the other eligible industries under Industrial Investment Promotion Policy.

• The Fresh Food Policy came into effect from April 2005. The reimbursement of cost of power shall be extended for a period of fi ve years from April 2005. Those food processing units which have commenced commercial production after November 2003 shall be eligible for reimbursement of the power costs.

Mines & Mineral Policy

The State Government has adopted certain strategies to ex-plore, exploit and develop the potential of the mineral sector with cooperation of the private sectors. The State has consid-ered the inventory of resources and key issues in legislature to formulate the objectives and strategies, to accelerate growth and develop the mining sector.

Highlights• The State has improved mineral administration through in-

teraction with the district level offi cers and the stakeholders.• Thrust is being given on pre-fi xed time disposal of mineral

concession applications to bring additional areas under min-ing and resource mobilization.

• Government extends support for grounding of high tech and innovative value added mineral projects under single window industrial clearance.

• The main aim of the State Mineral Policy is to serve as a guiding force to translate the mineral potential into reality with the objective of eco-friendly and sustainable mining.

Textile and Apparel Promotion Policy – 2005-10

Objectives:• To generate employment opportunities for additional 1.5

million persons in this sector by 2010• To achieve exports from the present scale of USD 93.65 mil-

lion to USD 6.09 billion by 2010

Focus Areas• Textile Sector• Handloom Sector• Powerloom Sector

Cluster Approach/Development in the Textile and Ap-parel Sector• Setting up apparel exports and textile parks in clusters with

the state-of-art technology to attract investors, promote exports and generate employment opportunities for jobless youth

• Introducing the concept of public-private participation

All the incentives provided in the Industrial Investment & Pro-motion Policy are automatically applicable to textile and apparel units.

Biotechnology Policy

The biotechnology policy focuses on segments such as diagnos-tics, therapeutics, pharmacogenomics, bioinformatics, agricultural biotechnology, industrial biotechnology, and marine biotechnol-ogy.

Objectives • To take a detailed inventory of the bi-resources in the State, • To encourage research and development • To develop high quality infrastructure, • To provide special incentives to biotech industry, such as

rebate on sales tax, exemption from power cuts, labour con-cessions, etc.

• To create an enabling environment and simplify procedures, • To facilitate the fl ow of venture capital funds and address

issues such as intellectual property rights.

Key Thrust Sectors

Information Technology

The State Government aspires to transform Andhra Pradesh into a knowledge society and make available the benefi ts of in-formation technology to all citizens, especially those in the rural areas. The objective of the State is to emerge as a leading desti-nation for investments in ICT (Information & Communications Technology) and a major player in the information economy.

Andhra Pradesh provides a favourable climate for the growth of IT business and is amongst the most preferred destinations for the IT industry in the country. Hyderabad is home to major MNC IT/ITeS giants and Fortune 500 companies such as Micro-soft, Oracle, Motorola, GE, HSBC, Deloitte, IBM, CSC, Amazon, UBS, Bank of America, Dell, Convergys, Celetronix, HCL, Wipro, Infosys, Satyam, Polaris, Cypress Semiconductors, Adaptec, ADP, Kanbay, Accenture, Computer Associates, Synopsis, TCS, Franklin Templeton, and several others.

IT Investments & TurnoverAbout 1400 ICT companies have made a total investment of USD 1.95 billion in the State until 2007. In the year 2004-05, the growth rate of the IT sector was 64.5% against national average of 34%, with an IT export turnover of USD 1.97 billion. In the year 2005-06, the growth rate stood at 51% against the national average of 36% with a turn over of USD 3.05 billion. In the year 2006-07, the growth rate was 48.4% against a national average of 32%, with an IT export turnover of USD 4.53 billion, contribut-ing to 14% of total IT exports and ranking 4th in the country. By 2009, the State plans to achieve USD 16.82 billion in terms of the IT export turnover.

IT EmploymentThe total employment generated till date by IT sector in the State is around 187,450. During the last 3 years, 101,505 jobs have been created as against the target of 300,000 jobs. The bal-ance employment of 200,000 is expected to be generated in the IT / ITeS sector by 2009.

New IT Majors attracted to the StateDuring the last three years, due to investor friendly initiatives of the Government, the following IT MNCs/Home-grown IT Majors have set up their operations in the State.

Further, Satyam, Infosys, Microsoft, TCS, Wipro, Genpact, are expanding their operations in Hyderabad as well as other Tier-2 locations in the State. To streamline the process of corporate travel between the US and India, the US Government is setting up its fourth consulate in at Hyderabad, after the embassy at New Delhi and consulates at Mumbai, Chennai and Kolkata.

Pharmaceuticals and Biotechnology

Hyderabad is considered to be the hub of the pharmaceuticals industry and is known as the bulk drug capital of the country. Some of the State based pharmaceuticals companies are globally known for their skills in chemical synthesis, process engineering and the discovery of new chemical entities.

A large number of bulk drugs units are located in and around Hyderabad with good infrastructure and trained manpower. Es-timates suggest that one-third of the national bulk drug produc-tion is from Andhra Pradesh.

The State produces a majority of 500 basic drugs produced in India. The present market size of the sector in Andhra Pradesh is USD 1.6 billion. The sector has grown by 16.29% in net sales during April-March 2005-06 in comparison to the previous year. In the fi rst quarter performance for April-June 2006-07, net sales have grown by around 43.02% against the same period previous year.

BUSINESS OPPORTUNITIES

Year Name of the IT Majors

2006-07

1.Thomson Corporation, 2.Qualcom 3.Novartis 4.Austria Microsystems 5.Seimens 6.Ikanos Communications 7.Cognizant (expansion) 8.Wells Fargo 9.Countrywide finance 10.Mahendra British Telcom 11.Gameloft 12.Quiselex 13.Celestica 14.Zensar 15.UNiSYS 16.Xilinx 17.Syntel at Visakhapatnam 18.Tishman Spayer. 19.Genpact (expansion) 20. First Indian Corporation 21. Covansys 22. iGate 23.HCL.

2005-06

1.Patni Computers 2.Sonata Software 3.Cognizant 4.Conexant 5.Cbay 6.Honeywell 7.Satyam at Visakhapatnam 8.Vorison 9.Amazan.com 10.UBS 11.Infinite 12. Intelligroup 13.DQ Entertainment

2004-05

1. McGraw Hill 2.Mindtree 3.HSBC – Visakhapatnam 4.HSBC – Hyderabad Group Processing Centre 5.Bank of America

Names of IT Majors


As a ‘biotech hub of India’, the State is credited with a number of fi rsts in the country. It has the fi rst knowledge park, biotech park, biotech incubator, biotech venture capital fund and agri science park. A stream of Indian and multinational companies have established their base in the State. The State Government is facilitating a number of innovative and ambitious projects to add to the attractiveness of the State as an investment destination. The biotech industry in Andhra Pradesh was worth approxi-mately USD 111 million, contributing to nearly 10 percent of the size of the industry in India, according to the BioSpectrum-ABLE Top 20 survey of June 2005. It accounts for 24 percent of the total biotech revenue generated by companies in south India (USD 463 million).

The presence of a large number of corporate hospitals and Government hospitals in Hyderabad and facilities for health care education and research have been facilitators for conducting clinical trials for drug development.

Andhra Pradesh offers excellent opportunities for fostering growth in the biotech and pharma industries essentially due to the availability of trained and skilled manpower and research & development facilities.

Andhra Pradesh has its share of leading players in biotech and pharma industry such as, Dr. Reddy’s Laboratories, Indigene, Shantha Biotechnics Private Ltd., Bharat Biotech International Ltd., Biological E.Ltd., Indian Immunologicals Ltd., etc.

Apparel and Textiles

Andhra Pradesh is the leading producer of cotton with an an-nual average production base of about 2.6 million bales. Medium grade and superior long staple varieties of cotton are predomi-nant in the State.

The State has a well developed and matured spinning sector. There are over 80 spinning mills including a number of 100% export oriented units with state-of-the-art machinery, produc-ing cotton, synthetic and blended yarns. There are 1079 weaving units with a production capacity of 789 million meters of fabric.

The State has, moreover, emerged as a large textile process-ing centre. Over 100 units have been set-up in the State with a processing capacity of 13 million meters of cloth per annum. The number of powerlooms in the State aggregates to around 44,000 employing approximately 110,000 workers. The sector has recorded a growth of 22.30 % in net sales during 2005-06 in comparison to the previous year. During April-June 2006-07, net

sales have increased by 2.52% against the corresponding period of the previous year.

With a growing demand for good quality fabric from the apparel manufacturing industry, there is a substantial potential for the sector to achieve rapid growth. The State aims to emerge as a major player in the production and exports of textiles by 2010. Apparels, fabrics, and furnishings have been identifi ed as growth engines by the State. It targets to achieve USD 2.04 billion in exports in handloom and textiles per annum by 2010.

The State aims to increase its domestic contribution for appar-els and textile products to USD 4.87 billion. The domestic sales of the State are expected to be around USD 2.92 billion per annum by 2010.

There are a number of opportunities existing in the State for setting up modern weaving and apparel units. The requisite infra-structure and an enabling policy create an optimal environment for the industry to grow.

Tourism

Andhra Pradesh is well known for its pristine beaches, sacred places of worship, lush green forests, spicy cuisines and hospita-ble people. Given the array of natural resources and the tradi-tional hospitality of its people, the State Government envisions bringing a large number of global travelers to Andhra Pradesh.

Acknowledging the vast potential and spin-off tourism has on other industries, the State Government is focusing on tourism for generating greater employment and achieving higher eco-nomic growth. The State is among the fi rst in the country to have an exclusive Tourism Policy.

During the last four years, the State Government has facilitated the launch of 68 projects with a total investment of USD 368.3 million. In addition, 88 projects with an approximate cost of USD 197.5 million, have been commissioned by the private sector.

AP Tourism has identifi ed vacant Government land to develop projects of tourist interests. The State shares about 23% of national tourist arrivals and 2.7% of international tourists visiting the country.

Andhra Pradesh Tourism Development Corporation (APTDC) has been developing tourist infrastructure in the State. The Corporation is involved in many areas of develop-ment i.e., hotels, resorts, wayside amenities, tourist packages, and boats, etc.

APTDC PROJECTS IN ANDHRA PRADESH

With a number of hotels and motley of tourist destinations such as Charminar, Golconda Fort, and Ramoji Film City, Araku Valley, Borra Caves, Tirupati Balaji Temple, and Puttaparthi Saibaba, the State offers attractive investment opportunities to developers and investors in the tourism sector. The Government has em-barked on a series of steps that will promote tourism and result in increased tourist infl ow in terms of value. It has adopted a pro-active, investor-friendly, open-door policy for investors. The clusters identifi ed by the Government for tourism development include Hyderabad, Visakhapatnam, Tirupati, Vijayawada, Nagarju-nasagar, and Warangal.

Agriculture and Food Processing

Andhra Pradesh is the largest producer of rice in India. It is also the leading producer of cash crops such as tobacco, groundnut, dry chilly, turmeric, oilseeds, cotton, sugar, and jute. It produces some of the fi nest varieties of mangoes, grapes, guavas, papa-yas, and bananas. The agricultural economy has supported the growth of allied industries in the areas of agro-processing, cold storage, warehousing, fertilizers, and packaging.

Horticulture

The State is well endowed with varied agro-climatic condi-tions for growing a variety of horticulture crops such as fruits,

vegetables, spices, tuber crops, and plantation crops, and is also pursuing fl oriculture.

The State holds number one position in production of mango, sweet lime, lime, papaya, chilly, turmeric and oil palm. It is second in production of tomato and coriander; third in pomegranate; fourth in tapioca, lady fi nger and grapes; and fi fth in onions. The State stands fi rst in productivity in oil palm.

The emphasis of the agriculture industry is on identifying and developing segments with high potential for growth, building strong agro based industries, developing agriculture in rain-fed areas, and spurring growth through policy reforms. The State is the second largest producer of horticulture products in India and it is expected that the production will reach 22.90 million tones by 2020.

Food & Agro Processing Sector

In the food & agro processing sector, the major segments include rice, mills, sugar, dal mills, diary units, milk products and confectioneries, palm oil, biscuits, mushrooms, etc. The State has about USD 1.21 billion investment in the food processing sector contributing 20% of the total existing investments in the State. The annual production in this sector is about USD 2.25 billion contributing to about 20% of the total industrial production in the State.

To achieve the growth envisaged for the agricultural sector, the State is targeting to attract investments of around USD 17.07 billion by 2010, while the total targeted investment until 2020 is estimated to reach around USD 39.02 billion.

The major companies involved in food and beverage production in Andhra Pradesh are:• ConAgra Foods, US –ConAgra Foods has partnered with

ITC Agro and established an R&D centre to adapt food tech-nologies to Indian conditions. Agro Tech Foods is now a USD 320 million company with a dominant market position in the edible oils and branded foods sectors. Its edible oils brands include Sundrop, Healthy World, ACT II popcorns and Rath.

• Kraft Foods, US – Multinational branded food and beverag-es company, Kraft Foods established a soft drink manufactur-ing plant in Andhra Pradesh in 2001, and is currently working on a new agronomy project.

Agriculture and allied services include animal husbandry, forestry and fi sheries as part of the industry. These are briefl y described below.

Source: Director of Tourism and Directorate of Economics and Statistics, Andhra Pradesh


Forestry

Andhra Pradesh has 63,814 sq km of forest area constituting 23.2 % of the total geographical area of the State.

Income accrued from the forestry sector in the State was USD 15.56 million in 2001-02 which grew to USD 23.05 million in 2005-06.

Fisheries

Andhra Pradesh ranks fi rst in brackish water shrimp production and fresh water prawn production. It stands second in fresh wa-ter fi sh production and in the total value of fi sh/prawn produced. In addition, the State ranks fi fth in marine fi sh production.

During 2005-06, 0.89 million tonnes of fi sh/prawn production was recorded as against 0.85 million tonnes during 2004-05. An output of 0.9 million tonnes of fi sh/prawn was targeted for 2006-07 and 1 million tones per annum by 2009.

Animal Husbandry

It is a rapidly expanding sector playing a signifi cant role in the rural economy. It is providing gainful employment to a large number of small/marginal farmers and agricultural labourers thereby enhancing their economic status.

The activities of the Animal Husbandry Department have been oriented towards health of livestock, and increased production of milk, eggs and meat.

Leather Industry

The State is a major producer of hides and skins in India, con-tributing about 19 million pieces per annum, constituting about 10% of the country’s raw material. There are about 34 large scale and medium scale tanneries in the State producing about 40 million square feet of processed hides and skins per annum. With 15 leather goods and footwear manufacturing units in the large and medium scale sector, the State is combining strategy, policy incentives and infrastructure development to further promote the sector.

The State is building capacity at all levels to have a comprehen-sive skill-base in the target artisan and worker groups. Leather Industries Development Corporation of Andhra Pradesh (LID-CAP) is the nodal agency for leading the leather programme in the State.

The Government is setting up specifi c infrastructure parks for promotion and development of the leather industry.

Leather Industrial Parks:• 71 mini leather industrial parks of 25 acres for processing

raw material• 16 medium leather industrial parks of 100 acres each for

processing semi-fi nished leather to fi nished leather.• 6 mega leather industrial parks of 300 acres each for conver-

sion of all intermediate products to export quality.

The Government provides fi nancial assistance in the form of investment grant to the extent of 30% of cost of plant and ma-chinery for SSI and 20% of cost of plant and machinery for other units, subject to a ceiling of USD 0.12 million for technology upgradation or/and expansion.

By encouraging multiple strategic alliances and partnerships, the Government intends to bring technology and knowledge trans-fer to the leather industry.

Other Sectors Identifi ed for Growth

Due to the presence of numerous resources, skilled manpower, quality infrastructure, and investor friendly Government policies, there are a number of sectors which have an immense potential to grow.

Hospitality and Entertainment

The State is making rapid strides in the retail and entertain-ment segment with the increasing population and tourist base of Andhra Pradesh.

To attract new investment in the sector, the Government is of-fering various incentives including investment subsidy of 20 % of the project cost subject to a maximum of USD 0.05 million. To encourage upgradation to international standards, select hotels will be offered an incentive of 15 % of the project cost.

Hospitality

Number of Hotels in Andhra Pradesh, 2007 Hyderabad Vishakapatnam Vijayawada Tirupati

5 star 7 1 - -4 star 3 1 1 -3 star 21 7 3 42 star - - - 1Total 31 9 4 5

Source: Federation of Hotel and Restaurant Associations of India

Key Upcoming Projects• A fi ve-star hotel with more than 250 rooms and 100 service

apartments is coming up near Hi-tec City, the IT hub, at an estimated cost of USD 121.95 million.

• Choice Hotels International is looking to enter the Andhra Pradesh market with hotels in Hyderabad, Tirupati and Vishakhapatnam. The company has partnered with Vishank Hotels International to develop a four-star, 130-room hotel as well as a service apartment complex in Gachibowli, Hyderabad under the Clarion brand name. Choice Hotels plans to launch budget hotels in Tirupati and Vishakhapatnam under the "Sleep Inn" brand.

• Panoramic Universal Limited plans to introduce four hotels in Thane, Durgapur, Hyderabad and Pune by 2009. The facility in Hyderabad will be a four-star hotel offering 90 rooms at an investment of USD 9.75 million.

Leisure & EntertainmentThe Leisure & Entertainment sector is witnessing investments in projects involving world class spas, entertainment centres, mega shopping malls, multiplexes, business convention centres, and theme parks. Urban entertainment, including amuse-ment parks, has redefi ned leisure and entertainment activities in the city.

Retail

According to a recent survey by International property consul-tants Jones Lang LaSalle, Hyderabad falls under the transitional stage in retail business. Organized retailing in Hyderabad is growing rapidly. Many smaller Tier III cities are now fi rmly on the radar screen of the retail players and mall developers. Vishaka-patnam features prominently among the emerging cities and Vijayawada is classifi ed as a nascent city in the sector. Hyderabad, Visakhapatnam, Vijayawada and Tirupathi are attract-ing retailers with their increasingly vibrant corporate sectors and high economic growth rates. These cities offer favourable opportunities for retailers due to growing consumer markets, considerable latent demand for branded goods and lower prop-erty costs. Organized retail is catching up in the State as retailers and devel-opers tap into the large middle class. These cities have signifi cant mall development in the pipeline.

Reliance Retail opened their fi rst “Reliance Fresh” stores in Hyderabad and Secunderabad in late 2006. The company has plans to open hypermarkets in cities such as Visakhapatnam, Vijayawada, and Guntur in the State.

Gems & Jewellery Industry

Hyderabad is considered as one of the leading jewelry hubs in India. Hyderabad offers a wide array of gems and jewelry op-tions ranging from precious gems, gold and silver jewelry to the famous bangles of Laad Bazaar. The city is famous for its pearl jewelry, considered the fi nest in India.

The State has taken the initiative to develop the AP Gems and Jewelry Park on an area of 2.5 acres in Hyderabad with an investment of around USD 12.68 – 13.90 million. It is a joint ven-ture between the Phoenix Group, IOI Corporation and A.P. State Trading Corporation. It has been developed as a state-of-the-art facility in which the fl oor space will be sold exclusively to jewel-ers and pearl dealers.

Rajiv Gems Park

Hyderabad Gems Special Economic Zone Ltd (HGSEZ) also known as Rajiv Gems Park, situated near the upcoming Interna-tional Airport at Shamshabad, would address all requirements of the industry from manufacturing to designing and trading with a host of additional benefi ts. The SEZ, to be set up at a cost of about USD 121.95 million, is expected to be fully operational by the end of 2008. The 200 acre park would house more than 75 diamond, gold and watch manufacturing units and gener-ate 50,000 new jobs. It would include a non-processing zone consisting of a residential enclave, an international trade centre, a world class convention centre in addition to an exhibition area. The Park is being developed by Gitanjali Gems Ltd. and the Phoenix Group.

Engineering Industry

The State Government has identifi ed engineering as one of the thrust sectors. The State is home to several public and private sector companies in diverse manufacturing diverse sectors such as ship building, fertilizers, high precision machine tools, drugs and pharmaceuticals, cement, paper, large power generating equipment, electronic hardware, long range missiles, castings and forging, defense electronics, etc.

The State has developed a strong entrepreneurial base with support from large public sector units like Defense Research Complex, Defense Research and Development Laboratory, De-fense Metallurgical Research Laboratory, Nuclear Fuel Complex, Bharat Heavy Electrical Limited, Hindustan Machine Tools, Hin-dustan Aeronautics Limited, Hindustan Ship Yard, Visakhapatnam Steel Plant, etc. These have helped build their ancillary network


and have laid the foundation for development of special purpose machines and precision machine tools and machining. This has further led to the development of a host of small and medium industries catering to the needs of defense, atomic energy, and space.

The World Bank has chosen the State for promoting the fi rst venture capital organization in the country at the state level.

Electronic Hardware

The key segments within electronic hardware industry existing in the State comprise of: • Telecommunications• Industrial Electronics• Test & Measuring Equipments• Computer & Consumer Electronic• Strategic Electronics

With special thrust on the hardware manufacturing industry, the Government proposes to provide support by way of exemp-tion from statutory power cuts, reimbursement of stamp duty, reimbursement of 50% exhibition subsidy, etc. The Government is further developing product specifi c Special Economic Zones (hardware/software) in and around Hyderabad.

There is immense scope for investments in the fi elds of nano technology, semi conductors, computer peripherals, appliances, precision engineering, ICs, LSICs, and VLSICs.

Semiconductors

With the announcement of the USD 3 billion investment for setting up of a fabrication unit in Fab City Hyderabad, Andhra Pradesh is positioned to become a leading semiconductor indus-try. Hindustan Semiconductor Manufacturing (HSMC) is set to announce a USD 2 billion fabrication unit in the near future In the State.

Fab City, located near the upcoming new international airport, has been allocated 1,200 acres land. It would be developed as an integrated hub with multi-modal transportation, hi-speed custom clearances and a centre of manufacturing excellence in semiconductors and related eco-systems.

The consumption boom in electronics is such as cell phones, personal computers, set top boxes, and other communication devices is expected to result in a corresponding increase in the domestic demand for semiconductor products. This would fur-

ther create a signifi cant business opportunity for semiconductor companies to market and distribute semiconductor products, provide assembly and testing services, design chips and related products, create and enhance world class technology, and manu-facture semiconductor chips.

There are various incentives provided for the same in the elec-tronic hardware policy of the State. These incentives are under heads such as exemptions, infrastructure, reimbursements, facili-tating technical education, etc.

Mines and Minerals

Andhra Pradesh is an acknowledged mineral storehouse of the south. It is among the prime mineral producers of the country. Minerals are a major contributor to the economic growth of the State.

Minerals from the State have signifi cantly contributed to the growth of cement, steel, ferro alloys, cosmetics, jewelry, con-struction, irrigation, pharmaceutical chemicals, processing fi llers, automobiles, asbestos & mica insulation, sculpturing monuments, pottery, power generation and refi nery industries in the State.

The mining sector in the State has been growing at 10-12% a year. The State stands second in value of mineral production, contributing about USD 195.12 million in 2006-07 . It produces about 80 million tonnes of industrial minerals and 8 million cubic meters of dimensional stones and building material, contributing nearly USD 210.97 million to the State exchequer.

The varied geology of the State provides a rich and wide variety of minerals for many mineral specifi c industries. Among the 48 minerals it has reserves of, notable are gold, diamond, baux-ite, beach sand, limestone, coal, oil & natural gas, manganese, dolomite, quartz, feldspar, precious & semi-precious stones, clays, calcite, steatite. Iron ore, base metals, uranium, granite, marbles, dimensional stones, and other building material. A vast mineral base and robust infrastructure present a large

Estimates Mineral Reserves (in million tones)

Coal 16,694 Limestone 35,220 Bauxite 613Barytes 76Diamond 1,822,955 (carats) Granite 2406 (million cubic meters) Gold (ore) 8.55Beach Sands 241


Estimated Mineral Reserves

opportunity for investment and development of mineral and mining projects. The State envisages participation and invest-ment from the private sector in mineral projects. The State has six coal based thermal plants with a generating capacity of 5000 MW power.

The Government intends to augment the coal production with private participation. It has identifi ed coal blocks for exclusive mining under the private sector and for captive purposes. There is a potential to tap 16,584 million tonnes of coal reserves for development of coal based thermal plants, washeries, gasifi cation and carbonization plants.

Petroleum, Chemical and Petrochemical Industry

The industry offers a wide scope for regional development and economic growth. To promote investment in this sector and to enable the State to emerge as a hub for domestic and interna-tional markets, the Government has decided to set up Petro-leum, Chemicals & Petrochemical Investment Regions (PCPIRs). The PCPIR would be specially delineated investment region with an area of around 250 sq km. for manufacturing facilities for domestic and export led production in petroleum, chemical and petrochemicals along with associated services and infrastructure.

The Government plans to locate the PCPIR near Visakhapatnam in an area of 250 sq km.

There have been several gas fi ndings in Krishna Godavari basin of the State by the Reliance Cairn Energy, Gujarat State Petro-leum Corporation (GSPCL) and Oil and Natural Gas Corpora-tion (ONGC). The anticipated gas production by 2008-09 would be about 40 million cubic tonnes per day. Petroleum companies are in the process of setting up a gas grid across Andhra Pradesh. ONGC is also setting up a 7.5 million tonnes refi nery in the Kakinada SEZ with a capital outlay of USD 1.82 billion.

HPCL Visakhapatnam plant is expanding its existing project from 7.50 to 15 MMTPA with a project cost of USD 1.95 billion. Re-

cently, the Ministry of Petroleum and Natural Gas, Government of India, has offered 1151 sq km. of shallow offshore and 1689 sq km. of onshore blocks in Krishna Godavari Basin in the New Exploration Licensing Policy-VI. The natural gas fi ndings would provide a major leap for the proposed PCPIR in Andhra Pradesh.

Healthcare

Andhra Pradesh makes a sizeable contribution to the healthcare sector in India with advanced therapeutic options, good patient care, innovative solutions for health, advanced information tech-nology systems and well-developed insurance plans. Neverthe-less, there is still scope for upgrading infrastructure and wider range of services extending from wellness to home healthcare. The major healthcare hubs in AP include Hyderabad, Vijayawada and Visakhapatnam, of which Hyderabad is the most developed one.

The Hyderabad healthcare cluster has expertise in cardiology, neurology, orthopedics, ophthalmology, etc. However, there are a few less explored segments in the sector which provide a vast potential to grow.

Telemedicine

Telemedicine is a step in bridging the geographical divide be-tween the patients in the rural and remote areas and hospitals based out of metros. Hospitals in Andhra Pradesh, including Apollo and Yashoda Hospitals are harnessing telemedicine for the benefi t of their patients.

The Apollo Group of Hospitals has recently announced the launch of Apollo Telemedicine Services at the Apollo Medical Centre in Muscat, linking the centre in the Oman capital to all hospitals of the group including Hyderabad’s Apollo Health City , in India, for post-treatment follow-up of patients undergoing advanced treatment.

Medical Value Travel

Medical or health tourism has become a common form of vacationing, and covers a broad spectrum of medical services. It combines leisure, fun and relaxation together with wellness and healthcare. Connectivity through international airlines and presence of hospitals of global repute such as the Apollo Group, Care Hospitals, Wockhardt Kamineni, L.V.Prasad Eye Institute, etc., make Hyderabad a preferred destination for medical value travel. Several international fl ights from the Gulf countries connect to

Landmark Natural Gas discoveries in Andhra Pradesh 2001 – Oil & Gas in Miocene / Pliocene in Deep Waters of Krishna-Godavari by Cairn 2002 – World’s biggest deep water gas discovery in Krishna Godavari basin by Reliance Industries Limited 2005 – World’s biggest gas discovery in shallow water in KG basin by GSPCL 2005 – Oil in Pliocene in shallow waters of KG Basin by RIL As per the estimates, expected production of Natural Gas in the Krishna-Godavari basin by 2010 is 95 MMSCMD28

Source: Commissionerate of Industries, Government of Andhra Pradesh


Hyderabad. Hence, the city gets sizeable patients from these countries.

Due to the presence of many Non Resident Indians in the United States from Andhra Pradesh, Hyderabad attracts many patients from the United States. In addition, statistics indicate that the hospitals in the city attract large number of patients from the Gulf, Tanzania and Nairobi.

Private hospitals in Hyderabad, some of which get 10 % of their patients from abroad, intend to open separate wards or wings for foreigners. The Apollo Hospitals already has a ward and plans to upgrade it to an international multi-specialty block, while the Asian Institute of Gastroenterology plans to create a separate wing for foreigners.

According to a primary survey , Apollo Hospital, Hyderabad had close to 10,000 international patients in the last fi ve years. LV Prasad Eye Institute, a tertiary eye care centre in Hyderabad had close to 7000 international patients in the last fi ve years. Growing at almost 50%, Care Hospitals is also receiving a good number of patients from Western Europe besides Middle Eastern countries such as Oman, Iran and Qatar. Patients also visit Hyderabad from other Asian countries such as Indonesia, Cambodia and Sri Lanka in view of better medical facilities avail-able in India.

All medical investigations are conducted on the latest, techno-logically advanced diagnostic equipment. Stringent quality assur-ance exercises ensure reliable and high quality test results.

With several Government initiatives such as promotion of medi-cal tourism, launch of medical visas, setting up of expert com-mittees and reduction of customs duty on the import of medical equipments and drugs, the sector is poised for strong growth. A number of resorts have come up across the State to serve as rejuvenation centres for tourists visiting for treatment.

Besides, the Government is also promoting various other forms of Indian medicine. A Kerala-based group has opened its branch-es at nine centres in the State for Ayurvedic treatment. The fi sh medicine for chronic asthma patients, a traditional treatment known only to Bathini Gowd brothers of Hyderabad, is admin-istered free of cost for 24 hours in the city in the months of May-June. The State Government makes elaborate arrangements for the people who come in thousands to take this medicine.

The other forms of traditional medicine practiced in the State

such as the bone-setting technique of Puttur and paralysis treat-ment at Chirala in Prakasam district are also being popularized by the tourism department.

Exports

Sector-wise exports in Andhra PradeshSl.No. Sector

2001-02 2002-03 2003-04 2004-05 2005-06(P) CAGR1 Software 706.09 894.63 1225.6 1986.9 3053.9 44.21%2 Drugs &

Pharmaceuticals & Allied Chemical Plastics

513.41 590.24 915.37 951.22 1198.54 23.61%3 ** Biotechnology 0.00 0.00 0.00 0.00 0.00 0.00%4 Agriculture & Agro-

based and Forest Products 705.12 740.24 440.24 280.98 295.02 -19.57%

5 Mineral and Mineral Products 154.63 177.80 210.24 221.95 237.49 11.32%

6 Handlooms and Textiles99.02 103.98 109.02 116.34 123.32 5.64%

7 ** Power 0.00 0.00 0.00 0.00 0.00 0.00%8 Engineering Items 254.88 280.37 333.66 385.85 489.76 17.74%9 Electronical & Electronic

Parts 10.98 13.41 20.49 31.71 34.88 33.52%10 ** Tourism 0.00 0.00 0.00 0.00 0.00 0.00%11 Leather, Animal and

Marine Products 533.66 471.05 435.37 418.29 451.76 -4.08%12 Handicrafts & carpets 46.59 48.91 61.46 65.85 68.49 10.11%

Total 3024.39 3320.64 3751.46 4458.78 5953.15 18.45%

Exports (USD Million)

Source: Socio Economic Survey, Andhra Pradesh, 2006-07 ** Data not available

Year-wise Total Exports in Andhra Pradesh

3024.393320.64

3751.464458.78

5953.15

0.00

1000.00

2000.00

3000.00

4000.00

5000.00

6000.00

7000.00

2001-02 2002-03 2003-04 2004-05 2005-06(P)

US

D M

n

Source: Socio Economic Survey, Andhra Pradesh, 2006-07

Foreign Direct Investment

2001-02 2002-03 2003-04 2004-05 2005-06 2006-071 IT/ITES 82.25 8.45 0.35 28.75 0.00 0.00

2 Pharmaceuticals & Bulk Drugs0.00 118.73 2.37 0.00 0.00 1.48

3 Biotechnology 0.00 0.00 0.00 0.00 0.00 0.004 Agriculture 0.00 0.70 4.37 0.00 0.00 11.755 Mines & Minerals 0.00 146.07 0.00 0.00 0.00 257.846 Apparels & Textiles 0.00 0.49 0.00 0.00 0.00 0.007 Power 0.00 6.06 0.00 0.00 1.72 0.008 Engineering 0.00 56.80 0.00 0.00 0.00 21.139 Electronic 0.00 2.17 0.88 0.00 0.00 0.00

10 Tourism 0.00 0.00 0.00 0.00 0.00 0.0011 Leather 0.00 0.00 0.00 0.00 0.00 0.00

Total 82.25 339.44 7.96 28.75 1.72 292.20

USD MillionSl.No. Sector FDI

Source: JD, Commissioner of Industries

Sector-wise exports from Andhra Pradesh

Year-wise Total Exports from Andhra Pradesh


Investments in the State Sector Promoter Investment Project Details Location Date of

Announcement

Science & Technology

Jurong International (Singapore), Springfield Land (Australia), Macquarie bank and Semb Corp Industries

USD 25 billion • The consortium members have signed a MoU with GoAP to develop an integrated science city on 65,000 acres.• The location is strategically situated at a distance of 400km from Hyderabad and 200km from Bangalore.• A sum of USD 25 billion would be invested over a period of 10 years.

Anantpur Jan-07

Petrol & Gas Hindustan Petroleum Corporation Ltd.

USD 8.53 billion

• Allotted 1500 acres in Vizag SEZ• Project will include Refinery, Aromatic plant & Cracker Unit.

Visakhapatnam Aug-07

Semiconductors Semindia USD 3 billion • 1200 acres land approved near new Hyderabad airport• Multi-modal transport system• High speed custom clearances• Centre of manufacturing excellences

Hyderabad Feb-07

Semiconductors Hindustan Semiconductor Manufacturing (HSMC)

USD 2 billion N/A Andhra Pradesh Nov-05

Petrol & Gas Hindustan Petroleum Corporation Ltd.

USD 1.95 billion

• Existing capacity of 7.5 MMTPA• Capacity expansion to 15 MMTPA

Vishakapatnam Aug-07

Petrol & Gas ONGC USD 1.82 billion

• 7.5 million tonnes gas refinery• Located in Kakinada SEZ

Krishna Godavari Basin

Real Estate NCC, ICICI Venture Funds, Tishman Speyer Properties

USD 853.6 million

• Satellite township project• 400 acres allotted

Tellapur (Near Hyderabad)

Feb-07

Electronics Intellect Inc. Korea and GoAP

USD 600 million

• Intellect Inc. Korea in association with GoAP has setup a Company named “Nano – tech Silicon India Pvt. Ltd.” • Project being setup on an area of 50 acres

Hyderabad Dec-04

Marine Nagarjuna Construction Company Ltd. (NCC), Maytas, SREI Infrastructure Finance Ltd.

USD 292.6 million

• Project involves development and operation of all weather deep water port.• To be developed on BOOT basis• Board has approved raising a fund of USD 180 million in funding for expansion

Machilipatnam Jan-07

Real Estate Sunway City Berhad, Opus Developers

USD 195.1 million

• Malaysian developer collaboration with city developer • Township to be developed on an area of 14 hectares

Hitec City (Hyderabad)

Jul-07

Real Estate Arihant Group USD 158.5 million

• Joint Venture with Vijayada Guntur Tenali Machlipatnam Urban Development Authority• Township project will be spread on 53 acres on Vijaywada-Guntur Highway.• 3000 apartments to be constructed over 5 years

Vijayawada Jul-07

Real Estate Indu Projects Limited USD 146.3 million

• Integrated township on a 50 acre site named “Indu Aranya”• Project comprises 270 independent houses, 950 apartments• Total builtup area will be 2 million sq.ft• Adjacent to National Deer Park

Hyderabad Jul-07

Hospitality Trident-Hilton USD 121.9 million

• 5 star hotel with 250 rooms and 100 service apartments coming up at Hitec city

Hitec City (Hyderabad)

Jul-07

IT/ITES TCS USD 97.5 million

• Acquired a land of 75 Acres in APIIC promoted SEZ.• State of art facility near new airport• Seating capacity of 15,000

Adibatla (Ranga Reddy District)

Apr-07

IT/ITES Cognizant Technologies

USD 80.4 million

• 75 acres of land allotted in Adibatla village of Ranga Reddy district• 2 million sq.ft office space to be built• Expected seating capacity of 12,000 employees

Adibatla (Ranga Reddy District)

Feb-07

Entertainment Fun Multiplex ( Essel Group)

USD 60.9 million

• To set up 50 multiplexes across Andhra Pradesh with more than 200 screens• Land acquisition and identification of builders and retailers under way.

Andhra Pradesh Jan-07

Leisure & Entertainment

Futures Group USD 33.4 million

• Urban entertainment centre on 5.61 acres at Basheerbagh • Centre to house shopping mall, multiplex, business convention centre, ethnic bazaar and theme parks

Basheerbagh (Hyderabad)

N/A

Leisure & Entertainment

Indian Hotels and Helath Resorts Hospitality Private Limited

USD 24.3 million

• GoAP & IHRH jointly setting up a world class spa in a area of 14.94 acres• Training centre in Spa technology & Hospitlity to be also launched

Nanakramguda (Hyderabad)

N/A

Real Estate Trinity Capital USD 18.3 million

• To develop commercial, retail and residential space in Hyderabad• Hyderabad based Manjeera constructions company will be a stakeholder

Hyderabad Jan-07

Hospitality Panoramic Universal Limited

USD 9.75 million

• Plans to launch 4 star hotel in Hyderabad by 2009• Facility will offer 90 rooms

Hyderabad Jul-07

Key Investments

Hyderabad poised to become the semiconductor capital of IndiaThe work on the USD 3 billion Fab City, India's fi rst semi-conductor fabrication facility has been initiated on the city's outskirts. The State would have 7,000 MW additional power ca-pacity in two to three years which is critical for the Fab City. The Indian semiconductor industry, which witnessed 29.8 % growth with a turnover of USD 3.2 billion in 2005, is expected to grow to USD 43 billion by 2015.

HPCL allotted 1,500 acres of land in Visakhapatnam SEZ

Oil major, Hindustan Petroleum Corporation Limited (HPCL) will be allotted 1,500 acres in the Special Economic Zone at Visakhapatnam in Andhra Pradesh. HPCL plans to set up a refi nery, aromatic plant and naphtha cracker unit at an invest-ment of USD 8.53 billion on this site. The already existing HPCL Visakhapatnam plant is increasing its capacity from 7.5 MMTPA to 15 MMTPA.

High-tech Science City to come up in Andhra Pradesh

A state-of-the-art integrated Science City will come up in Andhra Pradesh's Anantapur district with an investment of USD 25 billion over 10 years by a consortium of four Australian and Singaporean companies. The Odyssey Science City would come up on 65,000 acres of land between Odicheruvu and Ammadigu-da in Anantapur, about 400 km from Hyderabad. The consortium will invest about USD 3 billion during 2007-10 to build the ultra-modern integrated township on 10,000 acres. The project envisages a self-contained, hi-tech complex with its own com-prehensive infrastructure, including power, expressways, telecom networks, desalination plants, biotech parks, special economic zones, IT/biotech parks, industrial parks, hospitals, educational institutions, hotels and amusement parks. The project would provide direct employment to 1.5 million people and indirect employment to another million.

Key Players

Footprints:

The company has operations in Andhra Pradesh, Chandigarh, Punjab, Maharashtra, Rajasthan, Tamil Nadu, and Uttarakhand.

Revenue & Growth:

Having an asset base of close to USD 1.22 billion, GVK boasts of prestigious projects in hand worth USD 3.65 billion.

Key Businesses

Key Features

Airports

Mumbai International Airport Pvt. Ltd. (MIAL), a joint venture company owned by the GVK led consortium (74%) and Airports Authority of India (26%) was formed in March 2006 to manage and develop the Mumbai airport (CSIA). CSIA caters to 22.25 million passengers and handles around 480,000 tones of cargo annually.

Roads

GVK has won a concession in a highly competitive context, the Jaipur-Kishangarh BOT project, a segment of the Golden Quadrilateral National. The project, with a value of USD 157 million including a grant of the USD 47 million

SEZs

The GVK SEZ in Tamil Nadu will be spread over an area of 3,000 acres and will cater to industries such as textiles / garments, leather, engineering goods, pharmaceuticals, power, IT / ITeS, iron & steel, fertilizers, chemicals, petrochemicals, floriculture, horticulture, electronics & communication, etc.

Hospitality (TAJ GVK)

TAJGVK currently operates Taj Krishna, Taj Banjara, Taj Deccan in Hyderabad, and Taj Chandigarh in Chandigarh. Taj Chennai will be operational soon.

Power

GVK is developing power projects that are based on coal, gas and hydel resources. The projects are being developed across several states in the country, including Andhra Pradesh, Punjab, and Uttarakhand.

Biosciences (GVK BIO)

GVK BIO provides contract research services to a rapidly growing base of global pharmaceutical and biotechnology companies by combining science, innovation to help clients address their drug development challenges.

Urban Infrastructure (GVK ONE- MALL)

6,25,000 sq ft development with 750 car park and 500 two wheeler parking, 60,000 sq ft leading fashion dept. store, 40,000 sq ft six screen multiplex.


Highlights:• Commissioned India’s fi rst private power plant, the 216 MW

Jegurupadu combined cycle power plant (CCPP) with an investment of USD 2.5 billion in 1997.

• Renovating and modernizing India’s busiest airport Chatra-pati Sivaji International Airport, Mumbai.

• Distinction of laying the fi rst six lane expressway in India, the Jaipur-Kishangarh BOT project.

Dr. Reddy’s Laboratories

Dr Reddy’s Laboratories (DRL) Limited was established in 1984 by Dr. Anji K. Reddy. The company ranks among the top 15 generics players in the world. It currently employs around 6120 employees worldwide. It was the fi rst pharma company in Asia-Pacifi c (outside Japan) to be listed on New York Stock Exchange and fi rst Indian company to out-license new chemical entities to global pharma majors for clinical trials.

The Company is present across the pharmaceutical value chain from discovery R&D to manufacturing and marketing of Active Pharmaceutical Ingredients (APIs), branded formulations, gener-ics, specialty pharmaceuticals and biologics.

Footprints:

Presently, the company has a presence in 35 countries with operations in over 115 countries. It markets pharmaceutical products in more than 100 countries.

Business Functions:Revenue & Growth:

The company has a well established business of manufacturing APIs and branded formulations. The company started generics operations in 2001 and focuses primarily on North America and EU. In addition, the company is investing in creating businesses

of the future - the innovation led Specialty and Drug Discovery businesses.

In 2007, the company generated revenues of USD 1.5 billion. Overseas business contributes around 86% of the total revenues. The company’s branded formulation business is the largest and contributes around 41% of the total revenues followed by APIs with a share of 34%.

Capabilities:

DRL’s NCE research focus is in the areas of Metabolic Dis-orders, Cardiovascular Indications and Cancer. The company has fi led 81 patents with the US PTO of which 41 have been granted. About 951 scientists’ worldwide and 323 scientists are dedicated to new drug discovery research.

The company has proven skills in synthetic and analytical chemis-try to develop innovative cost effective manufacturing processes and expertise in developing innovative formulations.

Satyam Computer Services Ltd.

Established in 1987, Satyam Computer Services Ltd. is a leading global consulting and IT services company, offering a wide array of solutions customized for a range of key verticals and horizon-tals. From strategy consulting right through to implementing IT solutions for customers, Satyam straddles the entire IT space. The total workforce of Satyam globally was 42,500 as on June 2007.

Footprints:

Satyam's network of offi ces spans 57 countries, across 6 conti-nents. Nearly 42,500 dedicated and highly skilled IT professionals work in development centres and serve over 570 global compa-nies, including over 165 Fortune 500 corporations.

Alliances:Revenue & Growth:

The revenues for FY 2007 were USD 1.46 billion; a growth of about 33% over fi scal 2006 The increase from USD 459 million in FY03 refl ects a CAGR of 33.6%.

Major Achievements:

• Satyam simulated a fi rst-of-its-kind, cross-border country outage and business continuity operation in Singapore

• One of the fi rst companies to have been globally certifi ed to ISO 27001, ISO 20000 and ISO 9001 standards

• First company in the US, Australia, Singapore, Shanghai, Kuala Lumpur and India to have achieved the latest information security standard, ISO 27001.

• Among the fi rst 10 companies in the world to get certifi ed for CMM Level 5

• Among the fi rst fi ve companies to get certifi ed for BS7799 [fi rst IT company]

Lanco Infratech Limited

LANCO Infratech Ltd (LITL), one of the fastest growing corporate entities in India with more than two decades of expe-rience operating in the core sectors of power generation, power trading, construction, infrastructure and property devel-opment.

Footprints:

Lanco is headquartered in Andhra Pradesh, with presence in Karnataka, Uttarakhand, Uttar Pradesh in the infrastructure and power sectors.

Revenue Growth:

With a proven record in integrated infrastructure development, Lanco constructs, develops and operates projects in power, roads and other infrastructure. The construction and EPC wing has so far executed USD 487.8 million worth projects and has an order book worth more than USD 1829 million.

Business Functions:Power Generation

Currently generating 518 MW of power in six operational independent power projects, Lanco plans to have an installed capacity of more than 4000 MW by 2010 across conventional as well as non-conventional sources of energy.

Roads

Recently, Lanco has won the contract for construction and op-eration of two road projects in Karnataka on Build, Operate and Transfer (BOT) basis under the National Highways Development Project (NHDP) Phase III.The total project cost is estimated at USD 245.36 million.

Property Development

Lanco Hills Technology Park Pvt Ltd is developing an integrated park at Manikonda in Hyderabad spread over 100 acres, one of its kind in the country.

Power Trading

During the Financial Year 2007-08, Lanco has emerged second among all the power trading companies. In August 2007, it crossed the 1000 MU milestone in a fi nancial year.

Manufacturing

Lanco is in the business of manufacturing Foundry Grade Pig Iron and Portland Slag Cement. The manufacturing facility is located near Sri Kalahasti of Chittoor district of Andhra Pradesh, India. The company is accredited with ISO-9002 Certifi cation. It also manufactures ductile iron pipes.

RAMOJI GROUP

Ramoji Group has business interests in diverse sectors. The Ramoji Film City, which is recognized by the Guinness Book of World Records as the largest fi lm studio complex in the world, is also part of this group.

Print Media

EENADU: It is one of the largest circulated newspapers in the country and enjoys a circulation of 1,108,386 copies per day and is published simultaneously from 23 printing centres. It started its operations in 1974 from Visakhapatnam.

Satellite Television

ETV Network: A 12-channel source of rich infotainment, in the following languages: Telugu, Bangla, Marathi, Kannada, Oriya, Gujarati, Urdu; and Hindi for viewers in Uttar Pradesh, Rajasthan, Bihar and Madhya Pradesh. Ushakiron Television, another group


enterprise, carries out TV content/software development for the entire ETV Network

Film Production

Ushakiron Movies: The company founded in year 1983 has produced nearly 80 fi lms in Hindi, Telugu, Kannada, Marathi and Bangla.

Financial Services

Margadarsi Chit Fund: The fl agship company of the Group founded in 1962 is one of the most trusted chit funds (fi nan-cial instrument) companies, with a subscriber base of 3,60,000 members.

Food Processing

Priya Foods: As a respected brand leader it is involved in manufacturing products such as pickles, condiments, confec-tionery and edible oils through modern, state-of-the-art food processing equipment.

Hospitality

Dolphin Chain of Hotels: The company operates a range of hotels at Ramoji Film City – from super luxury Hotel Sitara to high-quality budget property Tara. The company set up Dolphin, Visakhapatnam’s fi rst ever three-star establishment, in the 1980s. Kalanjali: A vast and glittering multi-level complex offers the fi n-est arts, crafts and textiles from all parts of India under one roof. Kalanjali’s selection encompasses exquisite works that represent the best of the country’s diverse arts & crafts traditions – from handlooms to woodcarvings and from premium linen to furni-ture.

Brisah: A destination store for women, it has been promoted by the Ramoji Group in Hyderabad. It boasts of an exclusive range of designer outfi ts from designers such as Manish Arora, Anju Modi, Preeti Jhawar and Gaurav Gupta. It is a premium showroom featuring Indian, Indo-Western, and traditional wear, bridal wear and accessories, jewelry and footwear.Film DistributionMayuri Film Distributors: The company,founded in 1983, has been distributing quality fi lms for over two decades. Footprints:

The Ramoji Group has ground operations in most of the Indian

states through EENADU or ETV. It has manufacturing facilities in Andhra Pradesh, Tamil Nadu, Karnataka, Delhi and Maharashtra.

DOING BUSINESS

Key Approvals Required36

S.N List of Approvals & Clearances Required Respective Departments of State Estimated time

1.Registration, IEM, Industrial licenses Registrar of Firms 7 days

2. Allotment of Land/Shed in Industrial Estates or Industrial Areas

Andhra Pradesh Industrial Development Corporation

7 days up to 1000 sq. mts.

21 days above 1000 sq. mts.

3. Chief Commissioner of Land Administration (CCLA) Acquisition / Alienation of Govt. Lands 45 days

Panchayat Raj Department Urban Development Authority Town & Country Planning 4. Site & Building Plan Approval

Municipality

7 days

Urban Development Authority Town & Country Planning 5. Change of Land Use Municipality

45 days

Green 7 days Orange 21 days 6.

Consent for Establishment under pollution control Red

AP Pollution Control Board 45 days

Green 7 days Orange 21 days 7.

Consent for Operation under pollution control Red

AP Pollution Control Board 45 days

8. No Objection Certificate for Fire Safety Fire Services Department 15 days

9. Excise Registration Excise Department 14 days

10. VAT/CST Registration Commercial Taxes Department 7 days 11. Power Feasibility 7 days 12. Power Connection

Distribution Companies 23 days

13. Approval of Factory Plans 7 days 14. Factory License Factories Department 7 days 15. Sanction of Water Supply 7 days 16. Water Connection

Hyderabad Metro Water Supply & Sewerage Board 23 days

17. Permission to draw water from rivers / Public tanks Irrigation Department 30 days

36 Commissionerate of Industries, Andhra Pradesh, 2006


Assessment of the Business Climate of the State

Potential Sector Favourable Conditions/Success Stories

Information Technology

Home to major MNC IT/ITeS giants and Fortune 500 companies such as Microsoft, Oracle, Motorola, IBM, CSC, Dell, Satyam etc. As of 2006-07 approx. 1400 ICT companies had made a total investment of USD 1.95 billion in the State. High growth rate of 48.45% against national average of 32%, with an IT export turnover of USD 4.53 billion as of 2006-07. IT exports contributed 14% to the national exchequer in 2006-07. A host of SEZs dedicated to IT/ITeS such as Hi-Tech City in Hyderabad, L&T Infocity Limited, Mindspace, The V, Cyber City etc and a few upcoming ones in Manikonda, Rayadong etc. Policy Incentive37 - Rebate on cost of land, 100% reimbursement of stamp duty, urban land ceiling exemption, etc.

Agriculture & food processing

Horticulture Varied agro-climatic conditions suitable for fruits, vegetables, spices, tuber crops, plantation crops and floriculture. Second largest producer of horticulture products in India with production to reach 22.90 million tonnes by 2020. The State Government and the Government of India have jointly set up four agriculture export zones in the State.

Agriculture & Food Processing Sector AP is the rice bowl of the country with it being the largest producer of rice and cash crops such as tobacco, groundnut, dry chilly, oilseeds, cotton, sugar etc. USD 1.21 billion investment in the food processing sector contributing 20% of the total existing investments in the State. Annual production is about USD 2.25 billion contributing to about 20% of the total industrial production in the State. To achieve the growth envisaged, the State would need to promote investment around USD 17.07 billion by 2010. Dedicated SEZ in Chitoor, and a few upcoming ones in Guntur, Khammam and Nellore. Priya foods (part of the Ramoji group) has emerged as a leader in the pickles, powders, pastes, papads, etc., segment in the country. Policy Incentives38 - Reimbursement of cost of power for all eligible units shall be allowed @ USD 0.024 per unit as against USD 0.018 per unit as provided for the other eligible industries under IIPP, etc.

Pharmaceuticals & Biotechnology

Pharmaceuticals Hyderabad is the hub of pharmaceuticals and bulk drugs industry.

37 ICT Policy 2005-2010 38 Food Processing Policy 2005


One-third of the national bulk drugs production is from Andhra Pradesh. The State produces a majority of 500 basic drugs produced in India. Internationally renowned for its skills in chemical synthesis, process engineering and the discovery of new chemical entities. Establishment of Pharma Park (SEZ) under PPP basis in pharmaceutical city at Parwada, Visakhapatnam district on 2,200 acres to give a fillip to the industry. The State houses research labs such as CCMB, CDFD, IICT, ICRISAT, etc., for providing adequate R&D inputs. Dr. Reddy’s Labs, a leading pharmaceutical company in India and one of the leaders in generic pharmaceutical market globally, has its headquarters in Hyderabad, AP

Biotechnology Home to some of the largest vaccine producers in the country such as, Shanta Biotechniques Private Ltd., Bharat Biotech International Ltd., Biological E. Ltd., Indian Immunologicals Ltd. etc. Availability of trained and skilled manpower offers excellent opportunities for growth in pharma and biotech. Parks dedicated to biotechnology have been set up in AP such as SP Biotech Park, ICICI Knowledge Park, etc. Presence of a large number of corporate/Government hospitals and facilities for health care education and research will facilitate clinical trials of biotech and pharmaceutical products. Biotechnology Policy Incentives39 - Encouraging R&D, Infrastructure development, incentives in – Sales Tax, Land for Biotech Parks/Activities, Exemption from power cuts, Labour concessions, Land and grants for training institutes, etc.

Tourism AP is among the first States in the country to have an exclusive tourism policy The State shares about 23% of national tourist arrivals and 2.7% of international tourists. AP tourism has identified vacant Government land to develop tourist attractions and APTDC has been developing tourist infrastructure and packages for overall tourism development. During the last four years, the State Government has facilitated the launch of 68 projects with a total investment of USD 368.293 million. In addition, 88 projects costing USD 197.561 million have been set up exclusively by the private sector due to the State’s pro-active role. Policy Incentives40 - Investment subsidy of 20% of the project cost limited to USD 0.048 million. Concessional allotment of land on long lease of 33 years. 100% reimbursement of stamp duty and transfer fee on purchase of land or lease of land meant for the project etc.

39 Biotechnology Policy 2001 40 Travel and Tourism Policy 2006



Mines and Minerals

The State stands first in value of mineral production, contributing 9-10% of the country’s mineral value and contributing USD 195.12 million by way of foreign exchange. To augment the coal production, the Government has identified coal blocks for exclusive mining under private sector and captive purpose. To promote investment in petroleum, chemical and petrochemical industry, the Government has set up PCPIRs for domestic and export led production. There have been substantial investments by Reliance Cairn Energy, Gujarat State Petroleum Co. and ONGC in the sector. Policy Incentives41 - Improved mineral administration through interaction with the district level officers and the stakeholders. Government support for grounding of high tech and innovating value added mineral projects under single window industrial clearance etc.

41 Mines and Mineral Policy 1994

Average Cost of Doing Business in the Region The average cost of doing business in three key regions in the State is listed below.42

Hyderabad Visakapatnam-Vijaywada Others

Manufacturing Land Price (USD/sq mt) 100-200 40-100 20-50

Labour (USD/man Year) 825-1250

Lease Rent (US cents/ sq. ft.) 40.7343 36.59-60.9644 NA

Services

Occupation costs (US cents / sq ft/ month)

87.5-125 50-75 <37.5

Employee cost (USD/ man year)

Entry level professionals (< 5 years experience)

5, 000 – 25, 000

Mid-level professionals ( 5-15 years experience)

12,500 - 75,000

Senior professionals ( > 15 years experience)

50,000 - 250,000

Electricity (US cents/unit) Commercial 15.75

Industrial 9.75 – 10.75

Water (US cents per 1000 lts)

Commercial 50

Industrial 62.5

Residential rent (US cents/sq ft/month) 12.5-62.5 12.5-37.5

5-star hotel room (USD/ per night) 122-512 73-85 NA45

42 T

he da

ta ha

s bee

n sou

rced f

rom

AP G

over

nmen

t web

sites

, indu

stry s

ource

s and

EY

datab

ase.

43 P

asha

mylar

am S

EZ

44 V

isakh

apatn

am S

EZ

45Fe

w Di

strict

s hav

e Five

Star

Hote

ls

The parameters indicating a state’s competitiveness can be broadly classifi ed under the heads of – Industrial Competitive-ness, Policy Incentives and Social Competitiveness.

Methodology Step 1 – Assigning points to the parameters depending on the category assigned to them.

For a few parameters the category assigned is subjective and is based on industry reports and discussions with investors/senior Government offi cials, etc.

For Industry size, < USD 1 billion – Low; USD 1-3 billion – Me-dium; >USD 3 billion - High

For Employment, <20 million – Low; 20-30 million – Medium; >30 million - High

Step 2 - Assigning weights to the identifi ed parameters. The weight assigned to each parameter is based on the its impor-tance . The weight assigned to each parameter is given below:

Step 3 - Determining the weighted average for each param-eter depending on the average score of the parameter and the weight assigned.

Based on the above methodology the following grid has been formulated:

The factors which refl ect favourably on the State include commercial real estate availability, policy incentives and quality educational institutions. In the recent past projects have been announced and many are underway to improve the above men-tioned limitations.

These factors contribute towards making Andhra Pradesh an extremely competitive business destination.

OVERALL STATE COMPETITIVENESS

Category Points Assigned High 3

Medium 2 Low 1

Parameter Weight Assigned Industry Size (USD Bn) 20%Infrastructure 20%Real Estate Availability 10%Policy incentives for setting up and carrying out Business

20%

Law & Order 5% Employment (in ‘000) 10%Educational Institutions 5% Healthcare 10%

Parameter Andhra Pradesh Industrial Competitiveness Industry Size (USD billion) M (2.21) Infrastructure M Commercial Real Estate Availability H Policy Incentives Setting up and Carrying out Business H

Social CompetitivenessLaw & Order MEmployment (in mn) M (30.6) Educational Institutions HHealthcare HOverall Score 2.65


DISCLAIMER

This publication has been prepared for the India Brand Equity Foundation (“IBEF”).

All rights reserved. All copyright in this publication and related works is 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 elec-tronic means and whether or not transiently or incidentally to some other use of this publication), modifi ed or in any manner communicated to any third party except with the written apporval of IBEF.

This publication is for information purposes only. While due care has been taken during the compilation of this publication to ensure that the informa-tion is accurate to the best of IBEF’s knowledge and belief, the content is not to be construed in any manner whatsover as a substitute for profes-sional advice.

IBEF neither recommends nor endorses any specifi c products or services that may have been mentioned in this publication and nor does it assume any liability or responsibility for the outcome of decisions taken as a result of any reliance placed on this publication.

IBEF shall in no way, 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 reli-ance placed guidance taken from any portion of this publication.

‘India Brand Equity Foundation (IBEF) is a public-private partnership between the Ministry of Commerce & Industry, Government of India, and the Confederation of Indian Industry. It aims to effectively present the India business perspective

and leverage business partnerships in a globalising market-place.

INDIA BRAND EQUITY FOUNDATIONc/o Confederation of Indian Industry

249-F Sector 18Udyog Vihar Phase IV

Gurgaon 122015 HaryanaINDIA

Tel: +91 124 401 4087, 4060 - 67Fax: +91 124 401 3873, 401 4057

Email: [email protected]: www.ibef.org

Website in the Russian language: www.ibef.org/russia

May 2008

Documents

INDIAN STATES Economy and Business Andhra Pradesh · largest city in India and has emerged as a leading centre for the IT/ITeS industry. Visakhapatnam, Andhra Pradesh’s main port,