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EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 1
RUSSIA
INDIA
CHINA
THE LOCAL EXPERTS SOUTH EAST ASIA
MIDDLE EAST
CEE
KOREA
JAPANWESTERN EUROPE
ON BEHALF OF
EAC- EURO ASIA CONSULTING PARTG
MUNICH / SHANGHAI / MUMBAI / MOSCOW
MANUFACTURING COMPETITIVENESS
OF INDIAN STATES
KNOWLEDGE PAPER
MAKE IN INDIA MITTELSTAND (MIIM)
BERLIN, SEPTEMBER 2016
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 2
THE LOCAL EXPERTS
RUSSIA
INDIA
CHINA
SOUTH EAST ASIA
MIDDLE EAST
CEE
KOREA
JAPANWESTERN EUROPE
2
A. BACKGROUND: ECONOMIC RATIONAL
B. EAC ASSESSMENT OF TOP INDUSTRIAL STATES IN INDIA
C. CONCLUSION
CONTENTS
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 3
US
1.9 – 2.4%14,624
13%
Japan
0.0 – 0.7%3,937
19%
Russia
(1.8) – 1.5%731
16%
Korea
1.9 – 2.2%1,166
30%
3Source: IMF, World Bank, OECD, EAC Research
INDIAN ECONOMY – COMPARISON WITH GLOBAL PEERS
India is expected to be the fastest growing economy globally and target is to strengthen the manufacturing
share of GDP from current level
XXGDP in Bln EUR (2015)
XX%Share of Mfg GVA in GDP
Brazil
(3.5) – 2%367
12%
China*
6.0 – 6.5%8,349
41%
India
7.4 – 7.6%1,593
16%
Germany
1.3 – 1.6%2,774
23%
South Africa
0.6 – 2.4%232
15%
* China’s share of 41% is indicative of its industrial (inclusive of mfg., energy etc) GVA share in the country’s GDP
GDP growth (2016-2020)
Developing Asian economies Other developing economies
Developed economies
Malaysia
4.4 – 5%247
23%
Indonesia
4.9 – 6%604
21%
Thailand
3.0 – 3.1%250
28%
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 44
Source: EAC Research
WHY MANUFACTURING?
Indian government targets to create 100 mio new jobs by aggressively promoting manufacturing with a
target to increase GDP share of manufacturing to 25% by 2022
Target GDP
Manufacturing share
2015 2022
16%
25%
2nd largest population and with the youngest population by 20201
>12 mio people entering workforce each year2
~68% of youth lives in rural India and majority being fit for low skill work, migrate from rural to urban centres 3
Agriculture workforce (~44%) estimated to decline and services to have limited capacity to create/ absorb new jobs4
Transition needed from services led economy to manufacturing based 5
Only manufacturing sector can create required jobs to empower young Indian population and drive GDP growth6
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 55
RATIONAL FOR LAUNCH OF “MAKE IN INDIA”
Source: EAC Research
To convert demographic dividend of India to an opportunity, government initiated 3-stage mission of
creating new jobs, addressing skill gaps of young India and creating conducive eco-system for investment
INITIATIVES BY INDIAN GOVERNMENT
Target to add 100 mio new jobs by 2022 "MAKE IN INDIA" launched to attract long term FDI in manufacturing
"START UP INDIA" launched to Promote Young Entrepreneur's & Technology Innovation
"DIGITAL INDIA" to encourage Digitaliization
New “Ministry of Skill Development and Entrepreneurship” - skilling 500 mio by 2022
For co-ordinated implementation creation of 3 tier institutional structure of
– National Skill development agency (NSDA)
– National Skill development Co-ordination board (NSDCB)
– National Skill development Corporation (NSDC)
Introduction of labour reforms with the intention to club existing 40 laws into 4–5 laws
Improve ease of doing business by initiating measurable reforms like getting permits,
installation approvals, banking etc.
Job
Creation
Skill
Creation
Investment
Ecosystem
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 66
STATUS-QUO: MANUFACTURING FOOTPRINT
Source: EAC Research
The inherent diversity and sheer size of India makes it critical to establish a sound understanding of the
country prior to identifying the optimum location for setting up a manufacturing/ service facility
5 Major Manufacturing Clusters
13 Minor Manufacturing Clusters
15 Manufacturing Districts
Varied economic activity
and demographic
dividend
Strategic Diversity
Operational Diversity
State-wise industrial
policies
Geographically scattered
industrial clusters
Varying govt. support to
promote investments
Diverse support
infrastructure across and
within states
Scattered demand and
supply centres
Varying cost structures
(investment and
operational)
Varying government
support / competitive
trend
Geographically Scattered Manufacturing Locations
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 7
THE LOCAL EXPERTS
RUSSIA
INDIA
CHINA
SOUTH EAST ASIA
MIDDLE EAST
CEE
KOREA
JAPANWESTERN EUROPE
7
A. BACKGROUND: ECONOMIC RATIONAL
B. EAC ASSESSMENT OF TOP INDUSTRIAL STATES IN INDIA
C. CONCLUSION
CONTENTS
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 88
APPROACH FOR SELECTION OF STATES
Source: EAC research
3 step approach used to select relevant states for study viz. top industrial states basis mfg. metrics, states
benefitting out of tax incentives and states focused on specific sectors
5 states
2 states
7 states
Top 5 states that have developed
manufacturing eco-system and power
house of manufacturing growth in
India
States that have developed industrial
base on account of special incentives
given by central government
States that have significant
contribution to national
manufacturing GVA and are focussed
on specific sectors
Step 1
Step 2
Step 3
Haryana
Gujarat
Maharashtra
Karnataka
Tamil Nadu
Himachal Pradesh
Rajasthan
Madhya Pradesh
Odisha
Andhra Pradesh
Uttarakhand
Uttar Pradesh
Punjab
Bengal
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 99
TOP INDUSTRIAL STATES – PRIORITIZATION
Source: EAC Research
EAC arrived at top 5 manufacturing states based on evaluation of parameters of manufacturing GVA
contribution to national level, mfg. GVA share in State GDP and mfg. GVA growth through 2012-15
Manufacturing GVA contribution in
national GVA (2014-15)1 50%
Manufacturing GVA growth 2012-153 25%
Share of manufacturing in SGDP
(2014-15)2 25%
xx Overall weightage given
Top 5 manufacturing states
1) Manufacturing GVA contribution considered
29 states and 7 union
territories1)
Step 1
Haryana
Gujarat
Maharashtra
Karnataka
Tamil Nadu
Detailed strategic
and operational
parameters
assessment of
selected 5 states
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 1010
TOP INDUSTRIAL STATES – ASSESSMENT CRITERIA
Source: EAC Research
Top 5 states were thoroughly assessed on strategic parameters of manufacturing relevant population,
economic growth, education infrastructure, industry ecosystem and government support
Step 1
Share of population engaged in factories
Share of working population
DEMOGRAPHICS
Industry clusters
Major industry clusters: State industrial
zones, Special economic zones and private
industry parks
INDUSTRY ECOSYSTEM
Overall GSDP
GSDP growth rate
Manufacturing GDP
ECONOMIC GROWTH INDICATORS
Engineering and Polytechnic Institutions
Industrial training institute (ITI) / Technical
vocational centers
EDUCATION INFRASTRUCTURE
Upcoming infrastructure projects
Manufacturing investment plans
State government incentives
Ease of doing business
Political stability/ public unrest
GOVERNMENT SUPPORT AND STABILITY
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 1111
TOP INDUSTRIAL STATES – ASSESSMENT CRITERIA
Source: EAC Research
Furthermore, the top 5 states were assessed for operational parameters including utilities, logistic
infrastructure quality, labor availability /quality and standard of living
Step 1
Power
Water resources
Telecom and IT infrastructure
Land cost and availability
UTILITIES AND SUPPORTING INFRA.
Labor wages
Labor quality and availability
Nature of employer-labor relationship
Labor productivity
LABOR AVAILABILITY, COST AND QUALITY
Road transport
Rail transport
Air transport
Port infrastructure
ECONOMIC GROWTH INDICATORS
Living conditions
Safety (Crime Rate)
STANDARD OF LIVING
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 1212
TOP INDUSTRIAL STATES – OVERVIEW RESULTS
Source: EAC Research and Analysis
Maharashtra, Gujarat and Tamil Nadu are most attractive states for manufacturing, Haryana is emerging
state for future and Karnataka needs government efforts to live up to promise of the past
2.5
5
2.5 5
Op
erat
ion
al P
aram
eter
s
Utilities and
supporting infra
Logistic infra
Labor availability, cost
and quality
Standard of living
Demographics
Economic growth
Education infra
Industry ecosystem
Govt. support and stability
Strategic Parameters
Note: Bubble size represents relative state manufacturing GVA contribution (%) to nation
Step 1
Haryana
Strong automotive and
electronics cluster;
Needs to broaden
industrial eco-system,
and utilities infra.
Gujarat
Strong textile /chemical base;
developing engg; skill, academic &
social conditions needs improvement
Tamil Nadu
Strong cement,
automobile and
leather segments;
strengthen ease
of doing business
and marketing
efforts
Maharashtra
Well established industrial ecosystem;
improving cost competitiveness and
strengthening skilled labor
Karnataka
Strong in biotech,
aerospace, and
electronics; need to
improve utilities, port &
rail infrastructure
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 1313
TOP INDUSTRIAL STATES – COMPARATIVE ASSESSMENT
While Maharashtra is the largest economy in India, Gujarat has been one of the fastest growing states;
Haryana is an emerging state for the future
Step 1
Maharashtra Gujarat Karnataka Tamil Nadu Haryana
Key Sectors
Automotive
Pharma
Biotechnology
Chemicals
Gems & jewelry
Textiles Pharma Chemicals Petrochemicals Gems & jewelry
BIo-technology
Electronic hardware
Aerospace
Automotive
Automotive
Electronics
Cement
Textiles
Leather
Automotive
Medical equipment
Footwear
Food processing
Mfg. GVA CAGR
(%) – FY12-FY15
Contribution of
GSDP to GDP (%)
Key Supporting
Bodies
1) Gross State Domestic Product
6
3933
204170
2014-152011-12
14.5
11
2921
10581
2014-152011-12
6.9
5
1513
9880
2014-152011-12
7.0
6
2521
126100
2011-12 2014-15
8.9
9
97
4940
2011-12 2014-15
2.2
Source: MOSPI, EAC Research
Mfg. GVA
(bln EUR)
GSDP1)
(bln EUR)
Comparison of GSDP Vs. Mfg. GVA High Similar Low
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 14
Maharashtra Gujarat Karnataka Tamil Nadu Haryana
Utilities and supporting infra. Logistic infra.
Labour availability, cost and quality Standard of living
Maharashtra Gujarat Karnataka Tamil Nadu Haryana
Demographics Economic growth
Education infra. Industry ecosystem
Govt. support and stability
14
TOP INDUSTRIAL STATES – COMPARATIVE ASSESSMENT
Source: EAC Research and Analysis
With a longstanding and well established industrial base, Maharashtra leads the pack in strategic as well
as operational parameters
Step 1
Operational ParametersStrategic Parameters
4.3 3.9 3.6 4.1 3.2 4.0 3.6 3.7 3.5 2.9
6
4
3
2
5
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 1515
TOP INDUSTRIAL STATES – MAHARASHTRA
Source: EAC Research
Maharashtra has a well established industrial base that is spread across the state; however majority of the
development has been around the Mumbai and Pune regions
Step 1
Plans to build sound industrial ecosystem around
DMIC corridor and MIHAN (multi-modal
international cargo hub and airport Nagpur)
project
Pune
Nanded
Nagpur
Raigad
Mumbai
Aurangabad
Nashik
Thane
Ratnagiri
Kolhapur
Solapur
Sangli
Osmanabad
Ahmednagar
Latur
Wardha
Textiles Food Processing HubsAuto & ancillary Chemical Hubs
Districts with single industry focus Districts with multi-industry focus
~38% of India’s automobile
output by value in 2013
Over 17% of India’s chemical
revenue with over 1800 units
Attracted ~15 Bln EUR FDI
from 1991 with over 16,500 small
scale and 322 large scale units
Largest employer with 14
integrated textile parks and 10
new mega textile hubs planned
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 1616
TOP INDUSTRIAL STATES – GUJARAT
Source: EAC Research
Gujarat accounts for major share in India’s production and exports of Chemical, Pharma, Textile, Jewelry;
targets to be major hub for Auto by 2018; Ahmedabad, Vadodara, Surat among key industrial areas
Step 1
Developing 7 Special Investment Regions for
industrial activity by 2020; Additionally 4
industrial areas and 2 investment regions will be
developed as a part of DMIC project
TextilesAuto & ancillary Chemical Hubs Engineering
Kutch
Jamnagar
Rajkot
Bhavnagar
Junagad
Surendranagar
Mehsana
Ahmedabad
Anand
Vadodara
Navsari
Valsad
Surat
Bharuch
Sabarkanta
Panchmahal
Medical Equipment Districts with single industry focus Districts with multi-industry focus
Emerging as key destination for auto
Sector; targeting 10% output from by 2020
Accounts for 62% of India’s petrochem.
production, and 18% of chemical exports
Contributes 65% of denim production;
has presence of ~1500 medium to large
textile units
One of the largest medical eqpt. mfg.
cluster with over 55% of India’s cardiac stents
Accounts for 9% of India’s engineering
output
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 1717
TOP INDUSTRIAL STATES – KARNATAKA
Source: EAC Research
Karnataka commands major share of India’s output in Biotech, Aerospace, Automotive, Electronics sector;
Bengaluru is a key industry hub with an established ecosystem for multiple sectors
Step 1
Developing two industrial parks at
Vasanthanarasapura industrial area and Chennai-
Bengaluru Industrial Corridor; Mumbai-Bengaluru
Economic Corridor still in planning stage
BengaluruMangalore
Hukeri
Narsapur, Vemagal
Dodaballapura
Auto & ancillary ElectronicsChemical Hubs
Districts with single industry focus Districts with multi-industry focus
TextileAerospace and
Industry
Machine Tools
Mfg. hub for automotive major companies.
Honda’s largest two wheeler manufacturing plant
globally is coming up in Narsapur, Kolar district
Preferred choice for global players in aerospace
R&D, producing >25% of India’s aircrafts and space
crafts; India’s first aerospace SEZ in Belgaum
Estimated Machine tools manufacturing potential of
480 mio EUR
Estimated production of electronic hardware of 38
bln EUR with 29 bln EUR exports in 2014-15; 120
companies engaged in chip design; Bengaluru is a
hub for R&D in the software industry
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 1818
TOP INDUSTRIAL STATES – TAMIL NADU
Source: EAC Research
Tamil Nadu is the 2nd largest producer of cement; contributes ~20% and ~60% share in India’s automobile
and leather production, respectively; textile, electronics are amongst the major industries in the state
Step 1
Developing a 4th major port in the state with an
investment of ~3.6 bln EUR and an Integrated
Aerospace and Logistics park by TIDCO with an
investment of ~700 mio EURDistricts with single industry focus Districts with multi-industry focus
Chennai
Coimbatore
Dindigul
Erode
Kancheepuram
KarurMadurai
Kanniyakumari
Salem
Vellore
TiruchirappalliTiruppur
Thoothukudi
Mining
Auto & ancillary Petrochemical Textiles Electronics & hardware
Agro based Leather Chemical Metal
Chennai has an installed capacity to produce
~380 thsd cars and ~350 CVs each year; ~20% of
India’s total installed capacity of vehicle prodn.
The knitwear industry of Tirupur contributes
to ~80% of the exports in the textile sector
Vellore accounts for ~37 % of leather exports;
the state has ~60% of leather production in the
country
Chennai has emerged as the largest electronic
hardware manufacturing and exporting hub in India
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 1919
TOP INDUSTRIAL STATES – HARYANA
Source: EAC Research
Haryana has the largest automobile and electronics manufacturing cluster in India, followed by textile and
footwear & accessories manufacturing hub having presence of large scale companies
Step 1
Near 2/3rd of the state falls within the DMIC sub-
region resulting in 4 proposed indl. nodes; ultra-
modern aviation hub and integrated logistics hub
to be developed Districts with single industry focus Districts with multi-industry focus
Auto & ancillary Chemical Hubs Food Processing Hubs Textiles
Electronics Mfg. Cluster
Ambala
Hisar
Rohtak
Gurgaon Faridabad
Sonipat
Panipat
Panchkula
Rewari
Jhajjar
Produces 50% of the passenger vehicles;
39% of India’s 2-wheelers
With more than 450 chemical factories,
the sector registered a growth of ~5% pa
Second largest contributor of food-grains to
the national pool
Exports readymade garments of around
1.2 bln EUR annually
10 notified brownfield EMC, with presence of
leading industry players
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 20
Mah
aras
htr
aTa
mil
Nad
u
Har
yan
a
Kar
nat
aka
Gu
jara
t
20
TOP INDUSTRIAL STATES – KEY INFRASTRUCTURE PROJECTS
Source: EAC Research
Significant infrastructure development expected in the major industrial states; additionally new industrial
areas are planned to be developed as part of various proposed industrial corridors
UPCOMING INFRA. LOCATIONS
Step 1
Mah
aras
htr
aTa
mil
Nad
u
Har
yan
a
Kar
nat
aka
Gu
jara
t
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 2121
TOP INDUSTRIAL STATES – LAND COSTS
Source: State IDCs, EAC Research
There is a considerable variance in land costs across top industrial states; the focus is on promoting
development in the lesser developed regions by offering land at lower prices and higher incentives
INDUSTRIAL ZONE
CLASSIFICATION
Fully developed
Highly developed
Medium developed
Low development
Under-developed
No developmentH
igh
Low
Ince
nti
ves
for
inve
stm
ent
Step 1
Note: All values in EUR/ Sq. m.
0.1 - 11.1 - 6 1 - 9
2 - 50.3 - 13 0.4 - 2.61 - 27
59-117
3 - 451.3 - 33
0.7 - 3.34 - 41
64-197
5 - 471 - 9
11 - 277
5 - 115
4 - 29
18 - 148
95 - 641
MAHARASTRA GUJARAT KARNATAKA TAMILNADU HARYANA
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 2222
Source: EAC Research
STEP 2 – INCENTIVE BASED MANUFACTURING STATES
Step 2 identified states that have developed manufacturing due to central tax incentive schemes
Himachal
Pradesh
Uttarakhand
States that have developed
industrial base on account of
special incentives from central
government
Step 2
EAC has studied these states to gain perspective on sustainability of incentive based model in
future
Step 2
Himachal Pradesh
Uttarakhand
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 2323
SPECIAL INCENTIVE RECIPIENT STATES – COMPARATIVE ASSESSMENT
Source: MOSPI, EAC Research
Logistically challenged Himachal Pradesh and Uttarakhand have special incentive schemes from central
and state governments to promote industrialization; schemes to expire by 2017/ 20
1) Industrial Entrepreneur Memorandum
Note: GSDP values at 2004-05 constant prices
Step 2
Rationale Industrialization of backward, hilly terrain states utilizing local resources
Local employment generation
Incentive Scheme
Capital subsidy
Interest subsidy
Power subsidy
VAT reimbursement
State transport subsidy
Central and state governments have periodically revised industrial policies to promote development
STATE PROFILE: UTTARAKHAND STATE PROFILE: HIMACHAL PRADESH
IEMs1) implemented (nos) Investment (bln EUR)
Contribution to Indian
Mfg. GDP
GSDP (bln EUR)
5.5% 8% 0.6% 0.9%
Share of Mfg. GVA 13% 29% 12% 17%
3.3
10.3
2004-05 2014-15
3.26.3
2004-05 2014-15
Cumulative
Investment
Implementation
292.0156.0
0.6
1.2
2007-10 2011-15
32.0 22.0
0.1 0.1
2007-10 2011-15
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 2424
SPECIAL INCENTIVE RECIPIENT STATES – FUTURE ATTRACTIVENESS
Source: EAC Research
Possible phase out of tax incentives by 2020, long term labor availability issues and logistic constraints
impacts attractiveness of Himachal Pradesh and Uttarakhand as sustainable manufacturing destinations
Major shortage of semi-skilled and skilled labor, high attrition in both states are key concerns for
industries
National Skills Development Cell estimates double digit shortage in long term availability of labor
Dependence on single national highway for all logistical needs increased cost of transportation
Central Transport Subsidy to get over by 2017 increased cost for FMCG, pharma, auto industry
Unclear on extension of Central Industrial Policy 2003 and state incentives beyond 2020
Likely implementation of GST might phase out of area based tax incentives
FMCG, pharma industry currently expanding into states like Andhra Pradesh, Gujarat which offer better
infrastructure, labor availability
Hilly state doesn’t have a good network
of roads, the company has been facing a
2% logistical disadvantage
– Leading Equipment Manufacturer
LABOR
AVAILABILITY
LOGISTIC
CONSTRAINTS
TAX SOPS
WITHDRAWAL
Step 2
Company will shift its manufacturing location to
other states after withdrawal of tax sops; logistic
constraints and costs make operations unviable
– Leading Automotive Co.
Phase out of tax sops to result in
1% impact on margins
– Leading Eqpt. Mfr.
1) Goods and Service Tax
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 2525
Source: EAC Research
STEP 3 – SECTOR SPECIFIC MANUFACTURING STATES
Step 3 identified states with high contribution of manufacturing in national GDP and sector specific
specializations
States with significant
share in Indian
manufacturing GVA and
specialize in specific
sectors
RajasthanMadhya
Pradesh
OrissaAndhra
Pradesh
Uttar
Pradesh Punjab Bengal
Step 3
EAC has studied these states to understand strengths of states specializing in specific sectors
Step 3
Rajasthan
Madhya Pradesh
Odisha
Andhra Pradesh
Uttar Pradesh
Punjab
Bengal
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 2626
STATES FOCUSED ON SPECIFIC SECTORS – COMPARATIVE ASSESSMENT
Source: MOSPI, EAC Research
Sector focus states such as Punjab and Odisha have manufacturing share to GSDP of >13% and
Rajasthan, MP and UP of ~12% while Bengal and AP has share of ~10%
Step 3
1) Gross State Domestic Product
Rajasthan Madhya Pradesh Odisha Andhra Pradesh
Key Sectors
Mining Cement Food processing Renewable energy
Cement Food processing Auto (tyres)
Mining Food processing Auto
Fisheries Mining Textile Leather Gas production
Mfg. GVA CAGR
(%) – FY12-FY15
Contribution of
GSDP to GDP (%)
Key Supporting
Bodies
-4
89
6858
2014-152011-12
4.9
6
65
4940
2011-12 2014-15
3.8
0
66
3530
2011-12 2014-15
2.7
-5
67
5951
2011-12 2014-15
4.2
Mfg. GVA
(bln EUR)
GSDP1)
(bln EUR)
Comparison of GSDP Vs. Mfg. GVAHigh Similar Low
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 2727
STATES FOCUSED ON SPECIFIC SECTORS – COMPARATIVE ASSESSMENT
Source: MOSPI, EAC Research
Sector focus states such as Punjab and Odisha have manufacturing share to GSDP of >13% and
Rajasthan, MP and UP of ~12% while Bengal and AP has share of ~10%
Step 3
Punjab Uttar Pradesh Bengal
Key Sectors
Auto ancillary Bicycle Food processing Textile and machinery
Fertilizers Engineering Food processing Footwear Electronics
Leather Food processing Petrochemical Mining Steel/Engineering
Mfg. GVA CAGR
(%) – FY12-FY15
Contribution of
GSDP to GDP (%)
Key Supporting
Bodies
6
65
4236
2014-152011-12
3.0
3
1312
96
2014-15
111
2011-12
7.9
5
54
4353
2011-12 2014-15
6.5
GSDP1)
(bln EUR)
Mfg. GVA
(bln EUR)
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 28
THE LOCAL EXPERTS
RUSSIA
INDIA
CHINA
SOUTH EAST ASIA
MIDDLE EAST
CEE
KOREA
JAPANWESTERN EUROPE
28
A. BACKGROUND OF THE PAPER
B. OVERVIEW OF THE TOP INDUSTRIAL STATES IN INDIA
C. CONCLUSION
CONTENTS
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 2929
LOCATION ASSESSMENT – THE METHODOLOGY
Source: EAC Research
Location assessment is a methodical process involving a bottom-up approach for arriving at suitable
criteria for assessment followed by a step-wise filtration process to finally arrive at the ‘best-fit’ location
NCR Region
Ahmedabad Pithampur-
Dhar region
Pune
Hosur
Chennai
Hyderabad
Bangalore
Nashik
Vadodara
Jaipur
Nagpur
Mumbai
Qu
antitative p
aramteresQ
ual
itat
ive
par
amte
res
Location assessment in India requires two folded approach of “qualitative and quantitative parameters”
at each step from filtering state, industrial centre to plot
Methodology to choose most suitable plant location from -”29 states- >650 districts- multiple industrial centres”
To select “Right State“
Presence of relevant infrastructure,
talent pool, pro investment policies,
demand/supply centres
To select “Right Industrial Center“
Plot availability, development
status ease of compliance,
relevant industry base, local issues
To select “Right State“
State GDP, FDI inflows,
infrastructure cost, labour cost,
connectivity, tax incentives etc.
To select “Right Industrial Center“
Cost of plots, zonal incentives,
cost of utilities, distance from
customers- ports- suppliers,
logistics cost, labour cost
Conventional industrial centers Emerging industrial centers
EAC - MIIM I Overview on Top Industrial States in India I September 27th 2016 | 30
EAC OFFICE SHANGHAI
EAC - Euro Asia Consulting PartG
✉ Heimeranstrasse 37
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✆ +49 89 92 29 93-0
EAC - Euro Asia Consulting
✉ Sunyoung Centre, Rm. 1702 - 398 Jiangsu Road
200050 Shanghai/ China
✆ +86 21 63 50 81 50
EAC OFFICE MUMBAI
EAC - Euro Asia Consulting Pvt. Ltd.
✉ 306-310 Peninsula Plaza A/16, Veera Industrial Estate
Andheri (West), 400053 Mumbai / India
✆ +91 22 26 74 24 91
EAC - Euro Asia Consulting OOO
✉ Melnitskiy Per. 1
105120 Moscow / Russia
✆ +7 495 6401 013
EAC OFFICE MOSCOW
WHERE YOU CAN FIND US – EAC AROUND THE GLOBE
EAC HEADQUARTERS MUNICH
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