Investment Climate in Orissa - IBEF PAGE 5 Orissa - Select indicators Industry Key industries having...

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Investment Climate in

Orissa

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ORISSA PAGE 3

Table of Contents

Executive Summary .................................................................................................................. 3

Orissa - Select indicators ........................................................................................................ 5

Economic Overview ................................................................................................................. 6

Economic performance............................................................................................................ 6

People - Economic prosperity ................................................................................................ 6

Industrial performance .......................................................................................................... 7

Large and medium industries ................................................................................................. 7

Industrial centres .................................................................................................................... 9

Investments .............................................................................................................................. 9

Infrastructure .........................................................................................................................11

Industrial infrastructure .........................................................................................................11

Medical & Health Care Facilities ..........................................................................................11

Infrastructure for savings and borrowings.........................................................................12

Infrastructure for Agro-based industries ...........................................................................13

Key Nodal Agencies ................................................................................................................15

Policy Framework ...................................................................................................................17

Public Private Partnership Policy 2007 ...............................................................................17

Power Sector Reform Act 1995 ..........................................................................................18

Port Policy ................................................................................................................................19

Information and Communication Technology (ICT) Policy 2004 .................................20

Key industries and players .....................................................................................................20

Agriculture & Agriculture-related Industries ....................................................................22

Mining ........................................................................................................................................23

Power Industry ........................................................................................................................23

IT/ITES and Electronics Industry .........................................................................................24

Doing Business ........................................................................................................................25

Contact Information ...............................................................................................................26

Appendix ...................................................................................................................................26

A report by ICRA for IBEF

Executive Summary

‘Investment climate’ is a broad concept, encompassing all the factors affecting business decisions, including profi tability and where to locate plants and other units. A good investment climate provides opportunities and incentives for fi rms to invest productively and create jobs, thus playing a key role in ensuring sustained growth and poverty reduction.

Factors infl uencing investment climate include:

• Availability and ease of use of factor inputs such as land and labour;

• Availability of adequate physical and social infrastructure, such as power, telecom, urban infrastructure, water supply, hospitals, and educational institutions;

• Governance and regulatory framework in terms of rules and regulations governing entry, operation, and exit of fi rms, stability in regulation, integrity of public services, law and order and investment facilitation; and

• Provision of incentives and access to credit.

Orissa lies on the eastern coast of India bounded by the Bay of Bengal in the east, West Bengal in the north-east, Bihar in the north, Madhya Pradesh in the west and Andhra Pradesh in the south. Orissa is richly endowed with a variety of natural resources like minerals and forests, a long coastline, sea, sweet water and brackish water bodies, rivers and rivulets and a rich cultural heritage offering a wide range of fi ne manifestations having both aesthetic and commercial value.

Orissa has signifi cant geological potential and ranks sixth in

mineral production in India with vast mineral deposits like coal, iron ore, manganese ore, bauxite and chromite. According to the All-India Mineral Resources Estimates, Orissa accounts for 32.9 per cent of iron ore, 24 per cent of coal resources, 50 per cent of bauxite, 95 per cent of nickel and 98 per cent of chromite resources of India. With vast mineral resources, abundance of raw materials, a comfortable power situation and suffi cient skilled labour, the state has immense potential for industrialisation.

Orissa possesses signifi cant tourism potential and has promising prospects in marine-based and agro-processing industries. The power sector reforms in Orissa have succeeded in making it a power surplus state. In order to transform the state into a vibrant economic zone, the government is emphasising massive industrialisation with optimisation of value addition, technological upgradation and export promotion. Orissa enjoys political stability and a high level of law and order stability, which are critical factors for potential investments.

At the core of the government’s Industrial Policy Resolution 2007 and Vision 2020, is the private sector, which is seen as the main vehicle of growth, with the sate providing a level playing fi eld and acting as a facilitator. This strategy aims at achieving faster growth in sectors such as mining, tourism, handicrafts, and other manufacturing sub sectors, with a signifi cant presence of small and medium scale producers, and where Orissa has a potential comparative advantage.

Executive Summary

Regulatory Framework

Investment Climate of a State

Resources/InputPhysical &

Social Infrastructure

Incentives to Industry

ORISSA PAGE 5

Orissa - Select indicators

Industry

Key industries having business potential Mining, iron and steel, aluminium, power, IT/ ITES, tourism, infrastructure

Capital Bhubaneswar

Domestic Airport Biju Patnaik Airport, Bhubaneswar

Ports Paradeep, Gopalpur

Land

Area (sq km) 155,707

Coastline 482 km

Climate

Tropical climate

Summer: March to June

Rainy season: July to September

Winter: October to February

Average Rainfall (mm) 1480

Number of Districts 30

Number of Cities/Towns 102

Number of Villages 51,061

People

Major religions Hinduism

Principal language Oriya

Population (in million) (2001 Census) 36.80

Share of urban population 14.93%

State’s share in India’s population 3.58%

Sex ratio (females per 1000 males) 972

Literacy Rate 63.6%

Birth rate in 2005 (per thousand persons)

22.3

Death rate in 2005 (per thousand persons)

9.5

Infant mortality rate in 2006 (per thousand live births)

75

Orissa has signifi cant geological potential and ranks sixth in mineral production in India with vast mineral deposits like coal, iron ore, manganese ore, bauxite and chromite. The Government of Orissa is emphasising greater effi ciency and increased returns on investments. It hopes to reduce poverty in the rural areas by increased focus on agriculture. Gross fi xed capital formation (GFCF) is one of the most important indicators to measure the magnitude of economic development. The GFCF for the public sector at current prices increased to $846 million in 2002-03, showing a compound annual growth rate (CAGR) of 5.98 per cent over the decade.

Economic performance

The gross state domestic product (GSDP) of Orissa has exhibited an impressive growth rate of 9.53 per cent between 1999-00 and 2005-06, increasing from $8.16 billion in 1999-00 to $14.08 billion (advanced estimates) in 2005-06. This has been driven by growth in all three sectors – primary (comprising agriculture and livestock, fi shing and mining and quarrying), secondary (comprising manufacturing, construction and electricity, gas and water supply) and tertiary (comprising

communication, fi nancial services, real estate and related services, public administration and other services).

The secondary and tertiary sectors in particular have shown signifi cant increase in contribution to GSDP. The structural composition of the economy has changed over the years. The primary sector currently accounts for 42.7 per cent of the Net State Domestic Product (NSDP), having fallen from 49.4 per cent in 1997-98. The growth of primary sector has been 6.39 per cent during this period.

The secondary sector has a 15.4 per cent share in NSDP and grew at a CAGR of 11.12 per cent between 1997-98 and 2003-04. The tertiary sector accounted for 41.9 per cent share in NSDP in 2003-04, up from 36.9 per cent in 1997-98. This sector witnessed the highest growth rate vis-à-vis the primary and secondary sectors, driven by increased activity in the services sub-sector, which grew by 12.89 per cent CAGR during this period.

Orissa has a huge industrial base, comprising a number of large, medium and small-scale enterprises in steel, aluminium, chrome, power, textile, handicraft and a host of other sectors. The thrust is now also on agro-processing, electronics and software, aluminium, gems and jewellery, automobiles, basic drugs and pharmaceuticals, petro-chemicals and export-oriented units.

People - Economic prosperity

The per capita income in Orissa has a similar trend as the national per capita income, although in absolute terms the state has lagged behind the national level per capita income of $514.2. Orissa’s per capita income grew at a CAGR of 7.2 per cent from $203.6 in 2000 to $288.2 in 2005.

Economic Overview of the State

Orissa’s GSDP (US$ billion)

Source: Office of the Accountant General, Orissa

CAGR

9.53%

1999-00 8.16

2000-01 7.53

2001-02 8.75

2002-03 9.62

2003-04 12.32

2004-05 13.13

2005-06 14.08

0 2 4 6 8 10 12 14

Percentage distribution of NSDP

n Primary Sector n Secondary Sector n Tertiary Sector

Source: Economic Survey of Orissa, 2005-06

2003-04 42.7% 15.4% 41.9%

1997-98 36.9%13.7%

CAGR0 10 20 30 40 50 60 70 80 90 100

6.39% 11.38%11.12%

49.4%

Large &

Medium

Industries

Small scale

units

Handicrafts

& Cottage

Industries

Working units

(No.)

334 59,079 1,492,471

Fixed

investment

(US$ million)

409 274 117

Source: Industries Department, Government of Orissa (2005-06)

Mineral Resources as a % of national reserves

Iron Ore (32.9%) Bauxite (50%)

Nickel (95%) Chromite (98%)

Coal (24%)

ORISSA PAGE 7

The economy is mainly agrarian in character with agriculture providing livelihood to 87 per cent of the total population. But the state faces extreme climate and is prone to draughts and cyclones that have compounded poverty. The estimated percentage of population in Orissa below the poverty line during 2004-05 was 40 per cent, as compared to 22 per cent at the national level.

An indicator of the market attractiveness of a state is the annual income of its households. The distribution of households by income indicates that Orissa has a higher proportion of households in the lower income brackets. However, in the higher income categories in urban areas, the fi gures for Orissa are comparable with those at the national level. A comparison of asset ownership, like four-wheelers, two-wheelers and television, by households in Orissa vis-à-vis all-India level shows a huge potential for manufacturers of these goods as the income levels in the state rise.

The undivided districts of Koraput, Bolangir and Kalahandi (popularly known as KBK districts) are amongst the most backward regions in the country with a very high concentration of people below poverty line. These districts have been reorganised into eight districts: Koraput, Malkangiri, Nawrangpur, Rayagada, Bolangir, Sonepur, Kalahandi and Nuapada. The Government of India launched a Long Term Action Plan (LTAP) in 1995 to uplift these areas, which was later revised in 1998. Under the plan, the government sponsors schemes in various sectors like agriculture, horticulture, watershed development, afforestation, irrigation, health, drinking water, food, welfare of SCs/ STs and rural connectivity. In 2007, the Government of India extended the plan for another fi ve years.

Industrial performance in Orissa

Orissa is one of the most mineralised states in India with vast mineral deposits of coal, iron ore, manganese ore, bauxite and chromites. Other important mineral resources in the state are limestone, china clay, quartz, precious and semi-precious stones, copper and vanadium.

Several well known mineral-based industries have been attracted to the state. These include Rourkela Steel Plant (RSP), aluminium plants by Hindalco and National Aluminium Company (NALCO) and the three charge chrome plants at Brahmanipal, Bhadrak and Choudwar by Orissa Mining Corporation (OMC), Ferro Alloys Corporation and Indian Charge Chrome Ltd (ICCL), respectively. Indian Metals & Ferro Alloys has a plant at Theruvalli in Rayagada district producing charge-chrome and ferrochrome. The other important mineral-based industries

established include two sponge iron plants in Keonjhar district, a refractory in Dhenkanal district and mineral sands separation plants of Indian Rare Earth Ltd at Chhatrapur in Ganjam district. Several cement plants are present in the state. Four coal-based thermal power plants are located at Talcher, Kaniha, Ib Valley and Banharpalli in addition to the coal-\ based captive power plants by NALCO, RSP, ICCL and others.

According to the State Forest Report, 35.16 per cent of the state is under forest and tree cover. About 11 million people are dependent either directly or indirectly on the forests for employment and living. Kendu leaf trade is not only a major source of revenue receipt from forest produce, but also provides the largest employment in rural Orissa. During 2004-05, earnings from Kendu leaf were over $29 million.

The state has a mix of large and small-scale industries that have contributed to industrial growth. In 2005-06, the state had 334 large and medium industries and over 59,000 small-scale units.

Number of small, medium and large industries

Large and medium industries

Large industries like Rourkela Steel Plant, National Aluminium Company, Indian Charge Chrome Ltd, Paradeep Phosphates and coal-based power plants at Talcher, Kaniha and Banharpal have been set up in the state during different planning periods. By the end of 2005-06, Orissa had over 330 large and medium industries providing employment to over 85,000 people.

A number of large investment industrial projects in sectors like steel, alumina and aluminium, oil refi ning and fertilisers are in the pipeline. Indian Oil Corporation has signed an agreement with the state government for setting up an oil refi nery at Paradeep with an investment of over $2.6 billion. Similarly, Tata Steel has signed an agreement to establish a steel plant at Duburi with an investment of over $3.3 billion. These and other projects in the steel and aluminium sectors would create more than 50,000 direct and indirect jobs.

Large & Medium Industries

Small scale units Handicrafts & Cottage Industries

Working units (No.)

334 59,079 1,492,471

Fixed investment (USD million)

409 274 117

Source: Industries Department, Government of Orissa (2005-06)

Small Scale Industry (SSI)

SSIs are characterised by low capital investment requirement, low gestation period, high value addition and high export promotion prospects. The state government aims to develop, revive, modernise and reorient the SSI and tiny sector towards open market economy through a cluster development approach. Special incentives for these sectors like sales tax reimbursement, interest subsidy and capital investment subsidy have been announced by the government.

District-wise details of Small Scale Industries set up in 2004-05

Source: Economic Survey of Orissa, 2005-06

Handicraft and Cottage Industries

Orissa is known for its excellence in silver fi ligree, appliqué, stone carving, brass and bell-metal works, horn carving, terracotta and patta painting. The Directorate of Handicrafts and Cottage Industries provides administrative, managerial and fi nancial support for promotion, revival and diversifi cation of these traditional industries through various schemes. Twenty Handicraft Training Centres and fi ve woollen carpet weaving training centres are functioning in the state, which have strengthened the artisan-based enterprises in the handicrafts sector.

The Orissa State Co-operative Handicrafts Corporation is engaged in strengthening the production base, enlarging marketing opportunities, encouraging exporters, and introducing new design and technology in the handicrafts sector. It

assists Primary Handicrafts Co-operative Societies, voluntary organisations and artisans in improving the marketability of their products, and also procures a wide variety of handicraft products and undertakes their marketing both inside and outside the country through its sales outlets popularly known as “Utkalika”. It also runs a Craft Development Centre at Jeypore that provides services to craftsmen for development of handicrafts.

Industries in Districts of Orissa

DistrictNumber of SSI

units

Capital Invested in

million USD

Employment Generated

Sundargarh 482 7.4 2786

Ganjam 319 3.0 1270

Khurda 318 3.8 1525

Cuttack 314 3.1 1520

Balasore 270 1.8 1116

Mayurbhanj 236 2.2 913

Jajpur 231 1.5 1046

Puri 196 1.9 867

Bolangir 171 1.3 631

Kendujhar 169 3.2 664

Bhadrak 162 1.0 674

Others 1643 24.1 8886

Total 2868 54.3 13012

District Industries

Angul Mining and mineral-based industries, aluminium, coal mines, power generation and fertilisers; SSIs in engineering units, fl y ash bricks, grinding etc

Bolangir Mining and mineral-based industries. SSIs in agriculture-based industries, engineering and metal based industries, rubber and plastics, mining and chemicals

Baleswar/ Balasore

Alloys, paper mills, tourism, fi shing

Bhadrak Agro-based industries, fi sheries, tourism, ship-building

Bargarh Mining, cement, fi sheries, animal husbandry; SSIs in engineering, glass and ceramics, paper products, rice mills and agro-based products

Boudh Mining, textiles; SSIs in agro-based products and textiles

Cuttack Paper mills, textile and steel industries; handicraft and cottage industries (silver fi ligree, brass and metal works, stone carving, cane and bamboo products among others), food-processing

Deogarh Coal industries at Talcher, power generation, steel and food based industries

Dhenkanal Tourism, timber based industries, bamboo works, refectories and asbestos industries

Gajapati Fisheries, horticulture; SSIs in agro-based industries, engineering and metal works

Ganjam Chemicals, sugar, textiles; SSIs in food-based products, glass and ceramics, textiles

Jagatsinghapur Shipping, food processing, manufacturing, repairing and fi sheries

Jajpur Mining, food based industries

Jharsuguda Steel and related industries

Kalahandi Mining, sugar mill, cotton mill, oil seed based industry.

Kandhamal Food based industries, graphite industry, forest based products

Kendrapara Food based industries

ORISSA PAGE 9

Industrial centres in Orissa

The main industrial centres in Orissa are Angul, Bhubaneswar, Brajarajnagar, Choudwar, Damanjodi, Hirakud, Jharsuguda, Joda, Kalinganagar, Kansbahal, Rajgangpur, Rayagada, Rourkela, Sunabeda and Talcher.

The Export Promotion Industrial Park in Bhubaneswar, known as Infocity, has been established for the development of IT industries. A multi-storied building with 93,000 sq ft built-up space has been constructed in Mancheswar Industrial Estate, Bhubaneswar, for development of software units while another facility with 0.35 million sq ft built up area is under construction near Software Technology Park of India (STPI) centre in Bhubaneswar.

The Industrial Development Corporation of Orissa, along with the Central Government, is setting up industrial growth centres at Duburi, Jharsuguda, Chhatrapur and Kesinga and mini growth centres at Khurda, Raygada and Paradeep for promoting ancillary and down-stream industries.

Industrial Development Corporation of Orissa has acquired about 20,000 acres of land at Duburi Industrial Complex,

in Jajpur district, for establishing steel, power and other mineral-based industries. The Duburi Industrial Complex has infrastructure like power, water supply, road, railways and port links, which are crucial for these industries.

Investments in Orissa

Orissa is rich in mineral resources accounting for 32.9 per cent of iron ore, 24 per cent of coal resources, 50 per cent of bauxite, 95 per cent of nickel and 98 per cent of chromite resources of India, making it a preferred destination for foreign and domestic investors in the metal sector.

There are 45 projects in the steel sector that are underway in the state representing an investment of over $45 billion and capacity of over 56 million tonnes per annum (mtpa). Of these, 22 plants have been partly commissioned. Four new aluminium projects worth $10 billion and capacity of over 4 mtpa are under implementation. In addition, Orissa is home to a titanium project with an investment of $250 million. The major investors in the metal sector are POSCO, Arcelor Mittal, Tata Steel, Bhusan Group, Jindal Group, Essar Steel, Hindalco, Vedanta, Aditya Aluminium and L&T.

In the chemicals and petrochemicals sector, the state has a 15 mtpa petrochemical complex by Indian Oil Corporation, with an investment of $6 billion. Deepak Fertilisers is setting up an ammonium nitrate project at Paradeep. The Petroleum, Chemicals & Petrochemicals Investment Region (PCPIR) is under development at Paradeep, which would give further boost to industries in the state.

Energy and power is another major sector in Orissa. There are 13 thermal power projects under implementation with capacity of 13,500 MW and investments of $14 billion. The state also has mini-hydel projects with a combined capacity of 90 MW. Major players to have invested in Orissa include Tata Power, Reliance Energy, Sterlite Energy, Mahanadi, Aban, Monnet Ispat, Essar Power, Lanco Group, NavBharat Power, CESC and GMR Energy.

Orissa’s contribution to exports

Orissa has a high export potential in mineral, marine, forest-based products, handloom and handicrafts. The Industrial Policy formulated by the Government of Orissa accords priority to export promotion. The Directorate of Export Promotion and Marketing, Orissa, has been declared as the nodal agency for providing marketing and technical assistance to industrial units for promoting exports. The Directorate also provides overseas marketing information and maintains coordination with the

District Industries

Kendujhar Mining (iron, manganese, chromite), iron based industries, engineering and metal based industries, chemical based industries, agro-industries

Khurdha Agro-based industry, tourism, handloom industry

Koraput Mining, agro-based industry, forest based industries

Malkangiri Mining (tin, asbestos and dolomite), fi shing, forest based products; SSIs in light engineering goods and food processing

Mayurbhanj Mining, agro-based and forest based industries, mineral grinding

Nabarangapur Mining, sugar industries, agro based industries

Nayagarh Agro-based industries

Naupada Agro-based industries and few small scale industries

Puri Agro-based industries, fi shing and tourism

Rayagada Agro-based industries, fi shing, aluminium industry

Sambalpur Agro-based industries

Subarnapur Mining (coal, bauxite), agro based industries, ferrying, handloom industry, silk, rice mills

Sundergarh Textile, mining and metal based industries

Central Government, State Government and other export promotion agencies.

Orissa’s exports have increased signifi cantly over the years: from $551 million in 2000-01 to $2.39 billion in 2005-06, representing a CAGR of 34 per cent. Traditionally, metallurgical and mineral products have accounted for the majority of the state’s exports. In 2005-06, these products accounted for about $2.1 billion or 87.7 per cent of exports. Orissa exported iron ore worth $566.7 million, mainly to China.

In 2006-07, software exports from Orissa stood at $180 million, having grown at 58 per cent against the national average of 28 per cent during the year. The state has set a target of $1 billion worth of software exports by 2011-12.

Paradeep Port in Jagatsinghpur district is a major cargo handling port, through which minerals, metallurgical products and fertilisers are exported and imported. It handled 38.5 million tonnes of cargo in 2006-07, of which 24.85 million tonnes was exported and 13.65 million tonnes was imported.

Labour Force in Orissa

Orissa has a cost effective and adequate labour force. According to the occupational classifi cation of Census 2001, there were 14.3 million workers, constituting 38.79 per cent of the total population.

Orissa is one of the few pioneering states to reserve 30 per cent jobs for women in all government departments and public undertakings. The State Government is keen to encourage labour intensive industries. At the end of 2006-07, 0.97 million people were unemployed in a total workforce of about 14 million.

Industry-labour relations are cordial in the state. According to the Ministry of Labour and Employment, Government of India, of the 45 strikes that occurred across India between January 2007 and April 2007, only one was in Orissa.

ORISSA PAGE 11

Infrastructure like energy, transport, irrigation, fi nance, communication, and social infrastructure - education and health, plays a decisive role in determining the overall productivity and the level of development of any state.

Industrial infrastructure

Keeping in view the priorities laid down in the Industrial Policy, the Government of India has already sanctioned the development of growth centres at Duburi, Chhatrapur, Kalinga Nagar, Jharsuguda and Kesinga. An Export Promotion Industrial Park (EPIP) has been set up at Bhubaneswar to promote export-oriented industrial units with Central Government assistance. This has been renamed as Infocity and earmarked for establishment of all IT industries.

Industrial Promotion and Investment Corporation of Orissa Limited (IPICOL), Industrial Development Corporation of Orissa Limited (IDCO), and Orissa State Electronics Development Corporation (OSEDC) are three nodal agencies for promotion of large and medium scale industries in the state. Orissa Small Industries Corporation (OSIC) was established in April 1972 as a nodal promotional agency to assist small-scale industrial units in the state.

The state government has taken several steps to improve industrial infrastructure and promote investments in the state. Signifi cant among them are:• Development of industrial and social infrastructure in

steel and mining corridors, including setting up of railway corridors, upgrading ports, creating expressways, among others;

• Major expansion of Paradeep Port underway through public private partnership (PPP);

• Four new ports coming up with an investment of $2 billion at Dhamra, Gopalpur, Jatadhari Muhan and Kirtania;

• Bio-pharma park in Bhubaneswar through PPP;• Integrated Textiles Parks at Daleiput, Khurda and Choudwar;• Bhubaneswar Airport modernisation by Airport Authority of

India with an investment of over $60 million;• Investments in road and railways.

Software Technology Parks of India (STPI) has built technology parks at Bhubaneswar, Rourkela and Berhampur. In May 2007, the Chandaka Industrial Estate developed by IDCO in Khurda district was notifi ed as an IT/ ITES SEZ. Formal approval has been granted to nine SEZs and in-principal approval has been granted to six more in the state including those by Hindalco Industries, Saraf Agencies, Genpact, POSCO and Welspun.

Educational Infrastructure

Orissa has a large number of high ranked educational institutes like the National Institute of Technology, Rourkela, and Xavier Institute of Management, Bhubaneswar. The Department of Higher Education looks after education at the university, post graduate, graduate and higher secondary levels and also provides vocational education. The department also promotes professional courses in the government and private sectors. Orissa has nine universities, 88 engineering/ MCA colleges and 18 medical colleges. The new institutes that are coming up include IIIT Bhubaneswar, NISER and IIT Kharagpur Campus at Bhubaneswar. The Vedanta Group plans to establish a world-class technical university with an annual intake of 100,000 students in 95 disciplines. Sri Sri Ravishankar Vidya Mandir Trust has signed a Memorandum of Understanding with the state government to establish Sri Sri University of Art of Living with facilities to house 15,000 students and 1,500 faculty. During 2004-05, there were 45,700 primary schools with enrolment of over 5.2 million and 99,000 teachers.

The Industrial Policy of the state envisages a series of measures to improve technical manpower and upgrade the skills of local entrepreneurs. There is a Film and Television Institute in which the GRAMSAT programme has been introduced with the help of ISRO, Government of India. Craftsmanship training is being imparted through various government Industrial Training Institutes.

Medical & Health Care Facilities

In 2005, there were 1,701 government allopathic medical institutions in the state with 13,886 hospital beds. By the end

Infrastructure in Orissa

Health indicators

Orissa All-India

Population served per

Doctor 7,560* 1,607

Medical institutions 21,638* 26,536

Birth rate** 22.7 24.8

Death rate** 9.6 8.1

Infant mortality rate*** 65 63

Life expectancy at birth (years)

Male 60.1 64.1

Female 61.2 65.4

*As of year 2005

**Per thousand persons

***Per thousand live births

Source: Economic Survey of Orissa, Statistical Abstract of India

of 2004-05, there were 174 hospitals, 231 community health centres, 120 primary health centres (PHCs), 1,162 PHCs (with new facilities) and 14 mobile health units providing curative health services.

The state government has taken a series of steps to improve the healthcare facilities in the state. A Family Welfare Programme is being implemented in the state. Orissa has also launched a Total Sanitation Campaign to provide sanitation to all households by 2009-10. The programme is being implemented in all the 30 districts.

Infrastructure for savings and borrowings

Orissa is currently under-banked, which represents an opportunity for the banking sector. In 2006, Orissa had 14 urban cooperative banks accounting for just 0.8 per cent of all such banks in India. The average population covered per bank branch at the end of June 2006 for commercial banks was 17,000, which was greater than the all-India level of 16,000. Co-operative banks, regional rural banks and commercial banks have issued about 494,000 Kisan Credit Cards to farmers representing a sanctioned amount of over $500 million. Orissa had 499 offi ces of the State Bank of India and its associates and 959 offi ces of nationalised banks and two offi ces of foreign banks. Orissa State Financial Corporation (OSFC) provides soft loans and margin money for rehabilitation of sick industrial units.

Physical Infrastructure

TransportOrissa is developing its transport network to provide support to industries that are setting up facilities in the state. Participation from the private sector is being actively sought and encouraged to provide world-class infrastructure.

Roads Orissa has 238,000 km of roads including 3,508 km of national highways, 5,102 of state highways and 30 km of state expressways. Participation of the private sector is being encouraged in the construction of new highways. Some of the prestigious projects that have recently been completed are the Bhubaneswar-Cuttack highway, Talcher-Gopalpur highway and the four laning of Cuttack-Paradeep highway.

Railways Orissa in many ways is a link between eastern and western India through the railway network of South-Eastern and East-Coast Railways. At the end of 2005-06, the total railway line length in Orissa was 2,340 km. With the commissioning of the Talcher-

Sambalpur Railway, a vital link has been established between coastal and western Orissa. The Koraput-Rayagada and Daitari-Banspani lines have also been completed. When developed, the Haridaspur-Paradeep and Angul-Sukinda Rail links will connect the mineral-rich regions in the state to industries where the minerals will be consumed. The Daitari-Banspani and Khurda Road-Bolangir railway links are also under construction.

AviationA domestic airport is located at the state capital of Bhubaneswar in Khurda district. The expansion and modernisation of Bhubaneswar airport is in progress. Direct fl ights are available from Bhubaneswar to Delhi, Kolkata, Chennai, Nagpur, Mumbai and Hyderabad. Besides, there are 13 airstrips and 16 helipads.

PortsParadeep Port in Jagatsinghpur district of Orissa is a major port of India. It handled 38.5 million tonnes of cargo in 2006-07, of which 24.85 million tonnes were exports and 13.65 million tonnes were imports. Paradeep Port has its own railway system, water supply and bunkering facilities, and repair and maintenance facilities. The port is connected with broad-gauge railway system of the South-Eastern Railway and is also served by National Highway 5A. The concept of single-window service facility is available at the Port through its Central Documentation Centre (CDC). The CDC, besides housing the Traffi c, Marine and Finance & Accounts departments, also extends customs and banking service facilities. The port handles commodities including iron ore, chrome ore, thermal coal, food grains, coking coal and fertilisers, among others. Gopalpur Port in Ganjam district and Dhamra in Bhadrak are other important ports in the state that are being upgraded.

The State Government is encouraging private fi rms to step into the port sector to create infrastructure for several upcoming metallurgical projects. With the initiative of the State Government, private players have started work on developing all-weather ports at Gopalpur (by consortium of Orissa Stevedores Ltd, Sara International and Nobel Group), Dhamra (by Larsen & Toubro and Tatas) and Kirtania (by Chennai-based Creative Port Development Pvt Ltd). Besides, POSCO has proposed a captive port at Jatadhari Muhan in Jagatsinghpur district close to the site of its steel plant. The Hyderabad-based Navayuga Group has proposed developing a port at Astaranga in Puri.

Power Orissa was the fi rst state to embark upon reforms in the power sector. It undertook unbundling, corporatisation, and

ORISSA PAGE 13

privatisation of the power sector as part of these reforms. Orissa Power Generation Corporation Ltd (OPGC) has been established as a wholly owned government company with the main objective of establishing, operating and maintaining thermal power generating stations. Orissa Hydro Power Corporation Ltd (OHPC), on the other hand, has been established to look after hydro-electricity in the state. Four distribution companies have also been created – Western Electricity Supply Company of Orissa Ltd (WESCO), North Eastern Electricity Supply Company of Orissa Ltd (NESCO) and Southern Electricity Supply Company of Orissa Ltd (SOUTHCO), with investments from Reliance Energy, and Central Electricity Supply Utility of Orissa (CESU), with investments from AES Corporation.

Orissa is strategically located with facilities to interconnect eastern, northeastern, southern and western zones of the country through an extra high voltage transmission network. The state also has huge hydropower potential. Mahanadi river, which is the fi fth largest river in the country in terms of fl ood discharge (45,000 cusecs), fl ows through the heart of the state from west to east. The hydro potential of the state at 60 per cent load factor is assessed to be 2,850 MW. Orissa Hydro Power Corporation Ltd (OHPC) has an installed capacity of over 2,000 MW of hydropower with additional projects in the pipeline. Orissa also has 45,000 MT of power grade coal deposits in Mahanadi coalfi eld and Talcher coalfi elds area and can sustain 75,000 MW of power for 100 years.

Orissa’s share of power from central sector generating stations in 2006 was 734 MW, while the total installed capacity of power units including captive power plants was at 4,880 MW (source: Power Generation Corporation Ltd and Orissa Hydro Power Corporation Ltd). Twenty one per cent of villages were still to be electrifi ed by the end of 2007 and about 80 per cent of the rural households are yet to be electrifi ed.

Telecom & IT In the late nineties, Orissa had 228.8 post offi ces per million population, as against just 181.4 per million at the all-India level. At the end of August 2007, there were 3.8 million wireless connections and 770,000 wireline subscribers.

Orissa has also developed other telecom infrastructure to assist businesses especially IT and IT enabled services. It has created a number of IT Parks and towers.

• Infocity, Bhubaneswar: This IT Park is spread over 350 acres and houses companies like Infosys, Wipro, TCS and MindTree. Equipped with modern infrastructure including a 9-hole golf

course, it is one of the biggest IT parks in eastern India; • Fortune Tower: It has a built-up space of 350,000 sq ft in a

hi-tech steel and glass structure equipped with high-speed connectivity;

• Tower 2000: This is a seven-storied 94,000 sq ft facility equipped with all amenities including broadband connectivity;

• IDCO Tower: It is a strategically located, 11-storeyed business centre and houses a number of IT/ ITES companies.

There are numerous other projects coming up in the state, which will further its position as an IT destination in the east.

• The Info Park with 4.2 million sq ft of built-up space is coming up adjacent to the Infocity. It is being developed by DLF and would be accorded SEZ status;

• A Knowledge Industry Township is being developed over a 784- acre area as an integrated township just 15 km from Bhubaneswar. It would comprise an SEZ, residential, educational, commercial areas and business zones. It would be extended to 1,500 acres in Phase-I and 4,000 acres to be added in phase-II.

• IDCO BPO Complex is being jointly promoted by IDCO and Genpact and would be spread over 29 acres of prime land in the heart of Bhubaneswar. It would have 12 acres for Genpact, 17 acres for other BPO units and will be accorded SEZ status.

Infrastructure for agro-based industries in Orissa

The Agriculture Department consists of three executive wings: Directorate of Agriculture, Directorate of Horticulture and Directorate of Soil Conservation and Watershed Mission. Besides these, a number of autonomous bodies like Orissa State Seeds Corporation (OSSC), Orissa Agro Industries Corporation (OAIC), Agriculture Promotion and Investment Corporation of Orissa Ltd (APICOL), Orissa State Seed Certifi cation Agency (OSSCA), Institute of Management and Agriculture Extension (IMAGE) and Orissa Cashew Development Corporation are also working under the department.

Under the Cashew Development Programme, 4,000 hectares have been covered during 2005-06 with a fi nancial provision of about $54 million. The state government has signed an agreement with the Agricultural & Processed Food Products Export Development Authority (APEDA) in January 2003, for setting up an Agricultural Export Zone (AEZ) for promoting export of ginger and turmeric in the districts of Kandhamal and Koraput.

Watershed Development Programmes are currently being implemented in the state under various Centrally Sponsored Schemes like Drought Prone Area Programme (DPAP), Integrated Watershed Development Programme (IWDP), and National Watershed Development Programme for Rain-fed Area (NWDPRA), and River Valley Project (RVP).

The Central Rice Research Institute, Cuttack, has been providing rice research support by inventing low cost improved rice production technologies, improved agricultural implements and suitable rice-based farming systems under different eco-systems. So far, 63 high yielding varieties of rice have been developed for different types of land.

The Orissa University of Agriculture and Technology (OUAT), the second oldest agricultural university in the country, has grown into a full-fl edged institution having seven constituent colleges imparting education and training in various aspects of agriculture, animal husbandry and veterinary sciences. The University has developed a research base for generation of technology, capable of improving productivity, stability, profi tability and sustainability of the major farming systems. The University has strengthened its research base by establishing eight zonal research stations, four zonal sub-stations, 10 commodity research stations and 13 adaptive research stations spread all over the state, along with 46 All India Coordinated Research Projects and 41 National Agricultural Technology Projects currently operating in the University.

E-Governance in Orissa

A good e-governance infrastructure is already in place with the deployment of GRAMSAT, Secretariat LAN and the state portal. The Government of Orissa has placed high priority to enable government-to-government and government-to-customer services through e-governance.

A number of projects cutting across departments have been implemented including land records, registration, transport, treasuries, commercial tax, e-Shishu, web-enabled monitoring of anti poverty and rural development schemes. The Government has also initiated projects like State Wide Area Network (SWAN), Common Service Centre (CSC), State Data Centre (SDC) and many other new projects, notably e-procurement, RFID-based food grain delivery and monitoring.

ORISSA PAGE 15

In order to facilitate the growth of industries and to create an enabling environment to attract national and international investment, the State Government has enacted the Orissa Industries (Facilitation) Act, 2004, for implementing the Single Window Clearance System with the following objectives:• Faster and one-point clearance of industrial projects;• Single point dissemination of industrial project-related

information;• Streamlining of inspection of industries by different agencies

and authorities;• Leveraging public-private partnerships (PPP) for providing

infrastructure support of international standards to the industrial environment in the state.

Under Orissa Industries (Facilitation) Act, clearances for various state laws for establishing industries are issued through single window mechanism at district and state levels. It also provides for self-certifi cation by industries for compliance with various state laws and rationalisation of inspections to reduce the transaction cost and post-entry operations of industries.

Single Window Clearance Structure

The following three-tier single window clearance mechanism has been set up in the state, in pursuance of the Orissa Industries (Facilitation) Act (OIFA):• High Level Clearance Authority chaired by the Chief Minister

to examine and consider proposals involving investment of $238 million or above.

• State Level Single Window Clearance Authority chaired by the Chief Secretary to examine and consider proposals involving investment of $11.9 million or more but less than $238 million. It also monitors and reviews the performance of the District Level Single Window Clearance authorities.

• District Level Single Window Clearance Authority under the Chairmanship of Collector for speedy issue of licenses, clearances and certifi cations required under various enactments for setting up projects up to $11.9 million in investments.

The Government has also constituted Special Single Window Clearance Committees to consider proposals for projects in specifi c sectors of tourism, information technology, biotechnology and agro and food processing. The committees have been formed to provide professional guidance to investors in the respective sectors. These committees examine proposals with investments up to $11.9 million in their respective sectors.

CMD, IPICOL is in charge of overall supervision of the Single Window Clearance system and utilises the services of the

offi cials deployed in IDCO for assistance in appraisals and preliminary clearances of the investment proposals. IPICOL earmarks services of some offi cers who guide and escort the investors till the project clearance and implementation is completed. The offi cers are assigned to escort selected projects. This team of offi cers in IPICOL and IDCO are the most critical aspect of the single window mechanism.

A time bound system of providing approvals (processing the application and communicating the decision) for different clearances has been implemented. The State Government has designated IPICOL or ‘Shilpa Jyothi’ as the state level nodal agency and the District Industries Centre (DIC) or ‘Shilpa Sathi’ as the district level nodal agency.

As per the Orissa Industrial Policy 2007, fi ve District Industries Centres (DICs) with heavy industrial concentration or potential would be upgraded to Regional DICs. The regional DICs would provide comprehensive and intensive business development services to the existing and prospective investors and provide necessary support services to the DICs falling within their respective jurisdiction.

Provision for submission of Combined Application Form (CAF) has been introduced in the state to facilitate different approvals. Efforts have been undertaken to enable e-fi ling of CAF and the associated processing fee.

The government has taken proactive measures to attract investments by creating Orissa Investment Promotion Agency or ‘Team Orissa’. It encompasses the broad institutional framework of the government that is engaged in industrial facilitation and investment promotion in all key areas of economic growth. The principal goal of ‘Team Orissa’ is to provide necessary synergies and convergence of all government efforts to promote industries in the state. ‘Team Orissa’ is located in the offi ce of IPICOL.

Industrial Promotion and Investment Corporation of Orissa Ltd (IPICOL)

IPICOL is a key promotional institution that was incorporated in 1973 with the main objective of accelerating the pace of industrial development by promoting large and medium scale industries. IPICOL has promoted 263 large and medium scale industries by the end of the Ninth Plan period (2001-02) with a project cost of over $610 million. During the fi rst three years of Tenth Plan period, 10 industries have gone into production with a project cost of over $11 million.

Key Nodal Agencies

IPICOL acts as a single window facility for all information related to setting up large and medium industries. Forty-three large and medium projects were under implementation at the end of fi nancial year 2005 with an investment of over $18 billion. The steel sector has the major chunk of projects under implementation. As of 2005, 27 companies have signed MoUs for setting up steel or aluminium projects in the state.

Industrial Development Corporation of Orissa Limited (IDCOL)

IDCOL was set up in 1962 to promote setting up of industrial units for utilisation of natural resources available in the state. The Corporation, since its inception, has set up 15 industrial units in diverse sectors like cement, ferrochrome, pig iron and spun pipe under direct management. At present, IDCOL has nine subsidiary companies under its control. Under the Public Sector Restructuring Programme, IDCOL is exploring the possibility of disposal of assets of its defunct units. IDCOL has stepped up mining activities in the chromite ore mines at Tailangi in Jajpur district and iron ore mines at Roida in Keonjhar district and has exported chrome ore valued at over $3 million during 2004-05.

Orissa Industrial Infrastructure Development Corpora-tion (IDCO)

IDCO was established in 1981 with the objective of creating infrastructure facilities in industrial estates and areas identifi ed for accelerated growth of industries, trade and commerce. It is the only state level organisation to be conferred the “Golden Peacock” award by the Institute of Directors, New Delhi, for adopting and maintaining quality management standards in all its operations. It also bagged ISO-9001 & ISO-14001 certifi cate for providing infrastructure and services of high order and maintaining modern environment management systems. IDCO has established 86 industrial estates and areas all over the state. Ensuring availability of land for rapid establishment and orderly growth of industries is one of the most important objectives of IDCO.

Agricultural Promotion and Investment Corporation of Orissa Ltd. (APICOL)

APICOL came into existence in March 1996 to provide fi nancial support for promotion and development of agro-based and food processing industries. By the end of March 2005, the Corporation had promoted 59 agro and food processing units with an investment of about $22 million. Besides, APICOL had promoted 462 agri-enterprises by the end of 2004-05 with an investment of about $31 million. APICOL also provides subsidy

to agro and food processing units in the state.

Orissa State Financial Corporation (OSFC)

Orissa State Financial Corporation (OSFC) is a premier state level fi nancial institution that came into existence in 1956 to provide fi nancial assistance to small and medium scale industries in consortium with state level fi nancial institutions. Besides, the Corporation also receives fi nancial assistance from the state and central governments and provides soft loans and margin money for rehabilitation of sick industrial units. Since its inception, till 2004-05, OSFC had sanctioned loans amounting to over $317 million for 46,846 units.

Orissa Small Industries Corporation (OSIC)

OSIC was established in April 1972 to aid and assist SSI units in the state for their sustained growth and development. The Corporation extends marketing support, fi nancial assistance for purchase of raw materials, sub-contracting exchange of goods and renders various other services to small-scale units. The Corporation also administers certain incentives as per the Industrial Policy of the Government. During 2004-05, the Corporation supplied 40,562 MT of raw materials to small-scale units valued at over $20 million.

Directorate of Export Promotion & Marketing (DEPM)

DEPM promotes export of goods from Orissa and provides marketing assistance to SSI units. It disseminates market intelligence and overseas tender and trade enquiries among existing and potential exporters and entrepreneurs. It provides support in export processing, pricing of export items and information on different incentives for exports, granted by the Government of India.

ORISSA PAGE 17

Besides its Industrial Policy, the government has also formulated sector specifi c policies such as the ICT Policy, Tourism Policy, and Port Policy, among others.

Industrial Policy Resolution 2007

The state government has reaffi rmed its commitment to transform Orissa into a vibrant industrial state and has reformulated the Industrial Policy in March 2007 and passed the Industrial Policy Resolution 2007 (IPR 2007), which envisages to:• Create a business climate conducive to accelerate

investment in industry and infrastructure projects;• Raise income, employment and economic growth;• Reduce regional disparities in economic development within

the state;• Deregulate the business environment;• Implement and make operational single window mechanism

for industrial clearances;• Ensure balanced utilisation of natural resources for

sustainable development;

For the development of the state, the government is focusing on key strengths and has identifi ed the following key thrust areas:• Downstream industries in steel, aluminium and

petrochemical sectors;• Mineral processing and value addition;• Chemicals and fertilisers;• Agro and food processing industries;• Handicrafts and handloom;• Export oriented industries;• IT industries.

State Agricultural Policy 1996

Orissa has a wide range of fertile soil and suitable climate for agriculture. Development in agriculture holds the key to total development of the state as majority of the population is dependent on agriculture for livelihood. The policy emphasises agriculture for commercial purposes, agro-based industries, food processing industries, biotechnology-based industries and modern farming techniques. The policy also envisages the formation of Kisan Sahayak Kendra (KSK) for counselling prospective entrepreneurs on agriculture projects and assisting in providing various resources for starting operations.

Some of the salient features of this policy are:• Generate employment opportunities and enhance the

status of agriculture from the present level of subsistence agriculture to a profi table and commercial venture;

• Utilise agriculture as the main tool for poverty eradication

and promote entrepreneurship;• Make available knowledge of modern farming systems;• Adopt integrated programmes to solve problems related to

soil such as water logging, soil erosion, wasteland, saline soil;• Create skilled labour for management of modern

agriculture and help mechanisation of agriculture to increase productivity;

• Establish agro-based industries and food processing industries for higher value addition and reorient agriculture towards exports;

• Achieve self-suffi ciency in the production of fruits, fl owers, vegetables, potato, onion, milk, egg, fi sh and meat and increase area under tea, coffee, rubber, cashew and other plantation crops;

• Provide irrigation facilities to 50 per cent of cultivable land through completion of incomplete irrigation projects and promotion of individual and group enterprise;

• Promote private enterprise in the marketing of agricultural produces.

Watershed Development Programmes are currently being implemented in the state under various Centrally Sponsored Schemes like Drought Prone Area Programme, (DPAP), Integrated Watershed Development Programme (IWDP), National Watershed Development Programme for Rained Area (NWDPRA) and River Valley Project (RVP).

The broad objectives of the Watershed Mission are as follows:• Identifi cation and prioritisation of blocks and gram

panchayats for improving soil and moisture;• Identifi cation of watersheds;• Preparation of integrated watershed development

programmes through active community participation;• Development of waste lands through appropriate

interventions;• Conservation of run-off water, recharging of aquifers,

harvesting of rainwater and formulation and implementation of other related programmes;

• Promotion of self-help groups of landless people.

Orissa Public Private Partnership Policy 2007

The Public Private Partnership (PPP) approach is best suited for the infrastructure sector as it supplements scarce public resources, creates a more competitive environment and helps to improve effi ciencies and reduce costs. To achieve this goal, the Government of Orissa has formulated the Public Private Partnership Policy 2007.

Policy Framework

The key objectives of this policy are to:• Leverage State and Central Government funds, support

private investment and to create a conducive environment so as to utilise the effi ciencies, innovativeness and fl exibility of the private sector to provide better infrastructure and service at an optimal cost;

• Set up a transparent, consistent, effi cient administrative mechanism to create a level playing fi eld for all participants;

• Prepare a shelf of projects to be offered for PPP and take them forward with assistance of the owner departments through a transparent selection process;

• Put in place an effective and effi cient institutional mechanism for speedy clearance of the projects;

• Provide necessary risk sharing framework in the project structure so as to assign risks to the entity most suited to manage them;

• Create a robust dispute redressal mechanism and regulatory framework for PPP projects;

• Provide the required viability gap funding where the essential projects are intrinsically unviable;

• Create Orissa Infrastructure Development Fund to facilitate implementation of the objectives of the policy.

The infrastructure sectors covered by the policy include roads, bridges and bypasses, ports and harbours, airports, airstrips and heliports, inland container depots and logistics hubs, railways and urban infrastructure. It also includes industrial parks, theme parks like IT and biotechnology parks, knowledge parks, special economic zones, townships and trade fairs.

Institutional Arrangement

• A High Level Clearance Authority (HLCA) under the chairmanship of the Chief Minister is to be constituted to handle all projects above $12 million.

• An Empowered Committee on Infrastructure (ECI) consisting of a group of Secretaries under the Chairmanship of the Chief Secretary, is to be formed for facilitating infrastructure development under PPP. According to the policy, the ECI shall be the nodal agency to co-ordinate all efforts regarding development of infrastructure sectors, involving private participation and funding from various sources. ECI will handle projects up to about $12 million.

• The ECI is to be assisted by a PPP Cell constituted under the direct supervision of the Chief Secretary, in undertaking the functions specifi ed in the policy. The PPP Cell is to be assisted by a Technical Secretariat.

Power Sector Reform Act 1995

Orissa pioneered reform and restructuring by introducing Power Sector Reform Act 1995, which came in to effect from 1st April 1996. Orissa Electricity Regulatory Commission (OERC) has been formed as an independent and transparent regulatory authority. The role of OERC is to:• Take measures conducive to an effi cient electricity industry

in the state; • Issue license for transmission and distribution and set tariff;• Safeguard the interests of the consumers; • Prevent monopolistic behaviour by operators.

First Phase of Reform

Two government-owned corporate utilities were formed with an agreement to ensure full autonomy with effect from 1st April 1996. The Orissa Hydro Power Corporation (OHPC) is responsible for hydro generation and Grid Corporation of Orissa (GRIDCO) is responsible for transmission and distribution functions in Orissa.

Second Phase of Reform

Pursuant to the Orissa Electricity Reform Rules, 1998, the Government of Orissa transferred the distribution assets and properties along with the personnel of GRIDCO to four distribution companies namely CESU, NESCO, WESCO and SOUTHCO. Through a process of international competitive bidding, GRIDCO disinvested 51 per cent share to private sector investors keeping 39 per cent with itself and 10 per cent share for Employees Welfare Trust. At present, GRIDCO purchases power from independent generation utilities and provides it to the four privatised distribution companies who in turn cater to the need of consumers.

Proposal for Final Phase of Reform

At the end of the second phase of reforms, GRIDCO was responsible for three different functions:• Wire business that includes construction of new

transmission systems and sub-stations and maintenance of existing lines and sub-stations;

• Trading functions that include purchase of bulk power from generation utilities and selling it to distribution companies;

• Handling load despatch and functions of State Transmission Utility (STU).

ORISSA PAGE 19

The Electricity Act 2003, enacted by the Government of India specifi cally prohibits the STU and Transmission Company in the state from engaging in the business of trading. Keeping in view the statutory requirement of the Act for separation of trading and transmission functions into two separate entities, the state government incorporated the Orissa Power Transmission Corporation Ltd (OPTCL) to take over the transmission, STU/ SLDC functions of GRIDCO in 2005 and has been declared as the State Transmission Utility.

Port Policy

Ports are a critical infrastructure for exports and imports. Orissa, a principal maritime state, has a coastline of 480 km and is endowed with conducive, strategic and natural port locations. Paradeep is one of the major ports in India and offers tremendous opportunities for international trade. To develop the ports, the Government of Orissa has declared the Port Policy.

The objectives are:• To increase Orissa’s share in the export and import sector, in

national and international trade and commerce;• To decongest the existing major ports by developing minor

ports on the Eastern Coastal region, so as to cater to the needs of increasing volumes of traffi c;

• To handle 70-80 MT of cargo by 2006 in the port sector, as envisaged by the Ministry of Shipping, Government of India;

• To encourage shipbuilding, ship repairing, and ship breaking and to establish manufacturing facilities for heavy industries, in and around ports;

• To provide facilities for coastal shipping of passengers and inter-state cargo traffi c and further extension of these services to West Bengal, Andhra Pradesh, Tamil Nadu etc;

• To take up suitable facilitating measures as well as policy initiatives for attracting private sector investments in the development and operation of existing and new minor ports;

• To establish connectivity of the ports with the riverine systems to increase the transportation of cargo through inland waterways;

The policy also envisages the formation of Orissa Maritime Board (OMB) to act as a single window agency for development of ports and inland waterways. Apart from interacting and facilitating the development and implementation of an integrated maritime development plan for the state, it will also co-ordinate with the Ministry of Defence, the Indian Navy and the Coast Guard to evolve a mutually agreeable maritime safety and security plan for the entire coast of Orissa.

State Reservoir Fishery Policy

Orissa has immense water resources in the form of reservoirs, which have been untapped or under-tapped. Hence, for scientifi c management of these vast resources and for generating rural income especially for the fi shing communities and the displaced, the Government of Orissa has come up with the State Reservoir Fishery policy. The major objectives of the policy are as follows:• To augment fi sh production from the vast untapped/ under-

tapped reservoir resources through scientifi c management;• To generate gainful rural employment with special reference

to fi shing communities and economic rehabilitation of displaced persons;

• To introduce systematic management strategies both for conservation and sustained fi sh production;

• To attract increasing investments from private sector;• To stimulate entrepreneurship for fi shery sector with special

reference to reservoir fi shery;• To substitute traditional methods by introduction of

advanced technology in operation of reservoir fi shery;• To develop skills among fi shermen and fi sherwomen in

reservoir operation and organisational strengthening;• To generate substantial revenue for the state.

Orissa Tourism Policy 1997Through the Orissa Tourism Policy, the State Government acts as a promoter and catalyst to create an environment for planned and sustained development of tourism. The policy also welcomes and encourages non-government sectors to participate in tourism development.As per the Tourism Policy:• Maintenance and improvement of the existing roads and

planning of new roads to the tourist centres will be given due priority;

• Operation of charter fl ights will be encouraged while improving the air service to the state;

• Water sports and water transport services will be encouraged;

• Incentives to hotels and other tourism-related activities will continue;

• Efforts are being made to establish a convention complex and golf course at Bhubaneswar;

• Marketing and publicity of tourism potential and the facilities will be stepped up;

• Human Resource Development will be given priority.Special Tourist Police has already been deployed at Puri, which will be extended to other areas. A state level Tourism Advisory Board has already been constituted to advise the State Government on integrated development of tourism.

Information and Communication Technology (ICT) Policy 2004

The ICT policy encourages widespread use of IT for providing good governance to citizens and a faster and transparent decision making through an e-governance system. The policy has also been designed to attract investments into the state. The objectives of this policy are to provide:• Inexpensive access to information;• Transparency in governance practice;• Doorstep delivery of a host of services;• Increased employment;• High export turnover and economic growth;

According to the ICT Policy 2004:• IT and ITES units are declared as public utility services;• IT/ ITES units are exempted from the clearance and routine

inspections of the controlling and regulatory authorities of the State Government and are eligible for self-certifi cation to the labour, ESI and EPF authorities;

• All IT/ ITES industries will be exempted from the payment of Sales Tax for a period of fi ve years from the date of their fi rst billing;

• Important building infrastructure such as IT Parks, STPI Complex shall be free from power cuts;

• IT/ ITES units will be exempted from the payment of electricity duty;

• IT/ ITES units will be exempted from clearance from electrical inspector for approving contract demand of load and appliances to be fi tted in an IT unit;

• A combined application form to obtain clearances would be developed to centralise statutory/ non-statutory clearances and time bound clearances with provision of deemed clearances would be created for ICT industries;

• Interest subsidy on loans from fi nancial institutions/ banks at 5 per cent per annum to new units in IT/ ITES;

• Electrical energy consumption by IT/ ITES units shall be charged at industrial rate subject to approval of the Orissa Electric Regulatory Commission;

• No stamp duty will be charged on land allotted by government to IT/ ITES units;

• Special package of concessions will be offered to mega IT Projects involving project cost of $2.38 million and above providing employment opportunities to more than 500 persons;

• Price preference of 10 per cent will be available to local IT units participating in the e-Governance projects of the State Government.

Agencies identifi ed under the policy:• State Information Technology Services Board (SITSB) has

been constituted to oversee the ICT sector in the state. • Department of Information Technology will be the

administrative department in Government of Orissa in the matters of IT, ITES and communication.

• Orissa Computer Application Centre (OCAC) has been designated as the Directorate of the Information Technology department. It will coordinate and implement the ICT Policy and power the growth of IT in government and semi-government sectors.

• Software Technology Parks of India (STPI), Bhubaneswar, under the Ministry of Information Technology and Communication, Government of India, is responsible for promotion of export-oriented IT Units in the state.

Key industries and players in Orissa

Major industries in the state include those in electricity, basic metal and alloys, non-metallic minerals and food products. The state is dominated by more capital-intensive industries as compared to rest of India.

Aluminium Industry

Orissa has 50 per cent of the bauxite reserves of India making it an ideal location for setting up aluminium and aluminium-based companies. It also has adequate water and power supply to set up these industries. As a result, some of the biggest names in the aluminium industry including National Aluminium Company Limited (NALCO), Hindalco Industries lTD and Vedanta Group are present in the state.

National Aluminium Company Limited (NALCO)

It was incorporated as a public sector enterprise of the Government of India in 1981. Today, it is Asia’s largest and one of the world’s leading and seventh largest integrated aluminium complex, encompassing bauxite mining, alumina refi ning, aluminium smelting and casting, power generation, rail and port operations. It boasts of some of the world’s latest and fi nest technologies in the aluminium manufacturing industry. It has made the country more than self suffi cient in alumina and aluminium needs and has contributed to exports as well. The main units of NALCO in Orissa are at Damanjodi (Mines & Refi nery complex) and Nalconagar-Angul (Smelter & Power Plant Complex).

ORISSA PAGE 21

Hindalco Industries Ltd

With a turnover of $14 billion, Hindalco is the world’s largest aluminium rolling company and one of the largest producers of primary aluminium in Asia. It is owned by the Aditya Birla Group. It acquired the Indian Aluminium Company Ltd (INDAL), a pioneer among the country’s aluminium manufacturers, in June 2000. The Indal units comprise two smelters, one located at Hirakud, Orissa, with a captive power plant and coalmines. Project activities are on to increase the smelter capacity at Hirakud to 100,000 tonnes, with a doubling of captive power generation, as well as an additional 100 MW power plant.

Vedanta Group

Vedanta Resources Ltd, the London-based holding company of Sterlite group, is a key player in the aluminium industry in India. Vedanta operates several bauxite mines within the aluminium operations of group companies, BALCO and MALCO. Vedanta Alumina Ltd is setting up a 0.5 million tonne per annum capacity aluminium smelter at Jharsuguda at an estimated cost of $1.6 billion. The smelter would be supported by a coal-based captive power plant of 1,215 MW and is expected to be operational in 2008. It is also setting up an alumina refi nery at Lanjigarh in Kalahandi district of Orissa with a capacity of 1.4 million tonnes per annum. Vedanta Aluminium is also setting up a 16 km private railway linkage from its Lanjigarh aluminium refi nery in Orissa to the railway station at Ambadala.

Iron, Steel and Ferro Alloy Industry

Orissa is one of the biggest producers of iron and steel in the country. The state has assured long-term reserves of high quality iron ore and easy access to major steel consuming markets and raw material sources. Orissa has substantial reserves of other minerals that go into steel making, like coal, dolomite and limestone. In addition, there are abundant water resources, surplus availability of power, a reasonably good road and rail network, an existing port facility at Paradeep and two more new ports coming up at Gopalpur and Dhamra.

Tata Steel

Established in 1907, Tata Steel is Asia’s fi rst and India’s largest private sector steel company. It is amongst the lowest cost producers of steel in the world. It has pioneered some major initiatives in Orissa. It was the fi rst to introduce steel wages in its mines and provide all amenities, such as housing, electricity, water, medical facilities, etc. to employees who essentially came from Orissa.

Tata Steel has signed a Memorandum of Understanding with the Government of Orissa for setting up of a 6 mtpa integrated steel plant with an investment of over $3.6 billion in Kalinganagar Industrial Complex at Duburi in Jajpur district of Orissa. The project will be completed in two modules of 3 mtpa each, with the fi rst module being commissioned in 2008. The government has allotted around 2,000 acres of land to Tata Steel for the project.

Tata Sponge Iron Ltd (TSIL)

TSIL was a pioneering effort by Tata Steel in collaboration with IPICOL to bring industrialisation to a backward area of Orissa (Bilaipada, near Joda), by incorporating an indigenous technology for making sponge iron, which was developed through intensive R&D efforts at Tata Steel. About 310 acres of land was procured from the Orissa Government and locals for installing the plant and building a modern township. Today, TSIL is an associate company of Tata Steel and has 400 employees besides generating indirect employment for 300 others in the adjoining areas.

Rourkela Steel Plant (RSP)

Established in 1955, it is one of the largest steel plants of the Steel Authority of India Limited. A major producer of fl at, tubular and coated steel products, this plant produces 1.6 million tonnes of diversifi ed steel items annually. RSP made major improvements in the areas of steel quality, packaging, and delivery and customer satisfaction, thereby vastly enhancing the acceptability of its products in the highly competitive steel market. Thrust has been given to the packaging of HR coils, CRNO, galvanised plain and corrugated sheets and tin plates, resulting in these value added products reaching the customers intact.

Orissa Sponge Iron and Steel Ltd

Orissa Sponge Iron was incorporated in 1979. The company is promoted and managed by IPICOL and Torsteel Research Foundation India. The company’s plant is located in Palaspanga in Orissa.

Neelachal Ispat Nigam Ltd (NINL)

Neelachal Ispat Nigam Ltd (NINL) was promoted by MMTC Ltd, IPICOL and other government agencies. Its manufacturing facilities include a 1.1 mtpa integrated iron and steel plant at Kalinganagar, Duburi, in Jajpur district. Presently, the main products are pig iron and low ash metrological coke along

with nut coke, coke breeze, crude tar, ammonium sulphate and granulated slag (phase-I). The envisaged products in the future (phase-II) are billets, bars and wire rods of different grades and sizes. NINL has its own captive power plant to meet the internal power requirement.

Balasore Alloys Ltd (BAL)

Balasore Alloys Ltd, formerly Ispat Alloys Ltd, is a member of the renowned Ispat Group of companies owned by the Mittal family. BAL is an ISO 9002 Company and produces various ferroalloys. The company incorporates the most advanced technologies into its manufacturing process. BAL has fi ve furnaces that can produce a total of 100,000 mtpa of various ferroalloys. It acquired about 100 hectares of chrome ore mines in Sukinda Valley in Orissa. Mining operations have resulted in self-suffi ciency in meeting entire chrome ore requirement to produce ferrochrome on a sustained basis.

Pohang Steel Company (POSCO) and Arcelor Mittal

Arcelor Mittal has signed a Memorandum of Understanding with the Orissa Government for setting up a 12 mtpa steel plant in the state at an investment of over $9.5 billion, in Keonjhar district in two phases of 6 mtpa each. This is the second mega steel project proposed in the iron ore-rich state after the South Korean steel giant POSCO’s 12 mtpa plant at an investment of over $12 billion near the port town of Paradeep. Arcelor Mittal’s proposal would also include facilities for coke oven, steel making, rolling mills and a captive power plant of 750 MW.

Agriculture & Agriculture related Industries

Orissa’s main agriculture products are rice, pulses, oil seeds, vegetables, groundnut, cotton, jute, coconut, spices, potatoes and fruits. There exists vast scope for agro-based industries like rice milling, dal-milling, edible oil milling, dehydration of vegetables, maize milling, cattle poultry, cotton oil, potato chips, coconut oil, sugar mills, mushroom cultivation and non edible oils.

The state is enriched with vast forest resources. There is a vast scope for forest-based industries including wooden furniture, seal seed oil, neem oil, natural gums, biri making, incense sticks, palm rose oil, mahua rectifi ed spirit, manufacturing of cane, ayurvedic medicine, plywood, resins, mulberry silk, leaf plates and bee keeping for honey processing.

Sericulture is an agro-based industry having high potential in rural Orissa, which started in 1926 in Cuttack, Puri and Ganjam districts and gradually spread to Sundergarh, Phulabani

and Koraput districts. Orissa is also rich is resin production. Sreechem Resins Ltd, one of the market leaders in phenolic-resin manufacturing in India, is located in the state.

The sugar industry is being given emphasis with several projects underway. Orissa has suitable agro-climatic conditions for sugarcane cultivation with an average yield of about 64 metric tonnes per hectare. The state already has six sugarcane mills with annual capacity of 1.7 mtpa and has plans for establishing 14 more.

Coconut cultivation is done over an area of more than 50,000 hectares. During 2004-05, 558 coir units were functioning in the state with an installed capacity of 13,200 mtpa. Of these, four were owned by the government, 114 by co-operatives and the balance by the private sector. Orissa Co-operative Coir Corporation is the apex co-operative organisation dealing with marketing of coir and coir products. The Corporation is installing a rubberised coir plant at Chandaka Industrial Estate, Bhubaneswar, with fi nancial assistance from National Cooperative Development Corporation (NCDC), New Delhi.

Besides the above agro-based industries, the state also has several fertiliser units.

Rourkela Fertiliser Plant

This plant, located at Rourkela in Sundergarh District, is a public sector undertaking, which was set up 1964 to utilise the residue of the Rourkela Steel Plant and for the reutilisation of chemicals. The plant was set up by the Indian Fertiliser Corporation Ltd. and was handed over to the Steel Authority of India Ltd. in 1973. An improved quality of fertilizer called “Sona” (Nitrogen) is being produced from the plant.

Paradeep Phosphates Ltd (PPL)

PPL was incorporated in 1981 as a joint venture between the Government of India and the Republic of Nauru and currently held by fertiliser majors Zuari-Chambal Group and OCP of Morocco. It is a prime player in phosphoric fertilisers that have application in a wide range of crops. It produces diammonium phosphate with a capacity of 2,400 tonnes per day in the fi rst phase. Its second phase produces phosphoric acid and phosphorus pentaoxide.

Oswal Chemicals and Fertilisers Ltd

Established in 1981, the Oswal Group is one of the fastest growing business conglomerates in India. The group ranks among

ORISSA PAGE 23

the top-20 Indian business houses in terms of net worth. It leads in the production of agro-based products, petrochemicals, alcohol chemicals, nitrogenous fertilisers, phosphatic fertiliser and power. It has set up the world’s largest grass root DAP plant at Paradeep in Orissa. The project involves an investment of over $570 million.

The other major fertiliser plants in Orissa are:• A 45,000 tonnes per annum plant of Orissa Fertiliser and

Chemicals Ltd located near Kalunga;• A plant at Talcher in Dhenkanal district, producing 495,000

tonnes of urea and 228,000 tonnes of nitrogen;• A plant of Indian Farmers and Fertilisers Corporation Ltd at

Baragarh, producing mixed fertilisers.

Mining

Orissa is one of the richest states in India in mineral resources. The mineral belt is spread over an area of more than 6,000 sq km. The chief minerals are iron, coal, bauxite, manganese, nickel, chromite, lime stone dolomite, graphite, decorative stones, beach sand, china clay and tin ore.

Orissa Mining Corporation (OMC)

OMC was established in 1956 as a joint sector with the Government of India to explore and harness the mineral wealth of the state. Subsequently in 1962, it became a wholly state-owned corporation of the Government of Orissa. OMC has reserves of 400 million tonnes of iron ore, 19 million tonnes of manganese ore, 28 million tonnes of chromite, 220 million tonnes of bauxite, 19 million tonnes of limestone and other minerals. OMC is acting as a facilitating agent for the development of bauxite properties.

OMC operates 11 iron ore mines, 5 chrome ore mines, 3 manganese mines and one limestone mine. Some more iron, manganese, granite, china clay leases are being opened up for mining. South Kaliapani, Kaliapani, Sukrangi and underground mines of Bangur make OMC the leading chromite producer in the country producing a high-grade lumpy and friable variety.

Mahanadi Coalfi elds Ltd Mahanadi Coalfi elds Ltd (MCL), a subsidiary of Coal India Ltd (CIL), was formed in April 1992. It has two coalfi elds, Talcher and IB Valley in Orissa. The total coal production at MCL in 2006-07 was 80 MT against 69 MT in 2005-06. It employs over 20,000 people. There is continuous growth in the overall productivity

with the output per man-shift of the company increasing from 4.69 tonnes in 1992-93 to 13.30 tonnes in 2005-06.

Power Industry

The hydro potential of the state at 60 per cent load factor is assessed to be 2,850 MW. Orissa also has 45,000 MT power grade coal deposits in the Mahanadi Coal Field and Talcher coal Fields area and can sustain 75,000 MW of power for 100 years. This has attracted major investments in the power sector.

Reliance Energy Ltd (REL)

Reliance Energy has actively participated in the pioneering initiative of the Government of Orissa for privatising its distribution systems. In Orissa, REL has invested about $260 million in three electricity distribution companies: Western Electricity Supply Company of Orissa Limited (WESCO), North Eastern Electricity Supply Company of Orissa Limited (NESCO) and Southern Electricity Supply Company of Orissa Ltd (SOUTHCO). NESCO caters to a consumer base of 0.40 million with an annual energy input of 2,500 MW. WESCO caters to a consumer base of 0.40 million with an annual energy input of 3,700 MW. SOUTHCO caters to 0.40 million consumers with an annual energy input of 1,600 MW.

National Thermal Power Corporation (NTPC)

National Thermal Power Corporation is India’s largest and the world’s sixth largest electricity generation company. In 2006, it had a share of 19.5 per cent of installed capacity in India, generating 27.7 per cent of total electricity in the country. NTPC has two coal-based power plants in Orissa at Talcher and Angul in Kahina, having an installed capacity of 460 MW and 3,000 MW, respectively.

AES Corporation

The $13 billion AES Corporation is a leading global power company that generates and distributes electricity worldwide from 114 power plants and 17 distribution businesses in 27 countries. AES came to Orissa in 1998 when the state invited international bidders to disinvest the Orissa Power Generation Corporation (OPGC) following implementation of its Electricity Reform Act, 1995. AES manages the corporation’s two-generation units, each with a capacity of 210 MW. AES has invested over $150 million in the power sector in Orissa. AES also holds a 51 per cent stake in Central Electricity Supply Utility of Orissa (CESU), one of the four electricity distribution

companies in the state. The company has started the process of setting up of two more units of 600 MW each at the IB Thermal Power Station, which will commence operations by 2008.

IT/ ITES and Electronics Industry

The Orissa Government is setting up an Information Technology park at a cost of $110.6 million in Bhubaneswar. The government has already identifi ed 54 acres of land for the project, near the existing 250-acre IT facility, Infocity. Software exports in 2006-07 for the state stood at $180 million. The state is targeting software exports of $1 billion by 2011-12.

The IT sector is dominated by small and medium enterprises totalling more than 300 units. The state has a strong talent pool: it produces 20,000 engineers and MCA graduates, about 3,000 management professionals and 50,000 general graduates every year.

The major players in the state are Infosys, Satyam, Wipro, Tata Consultancy Services, MindTree Consulting, Genpact, Perfectus Technology and Contiloe Films.

Infosys Technologies Ltd

The $3.1 billion Infosys Technologies is India’s leading software services and IT consulting fi rm. In Orissa, it has a world-class development centre at Bhubaneswar with an employee strength of over 1,200. Infosys has been present in Orissa for over a decade now. The development centre at Bhubaneswar anchors Infosys’ relationships with multi-million dollar clients from Canada, Europe and North America. Infosys launched ‘Project Genesis’ in July 2007 to provide training on global skills enhancement to nearly 300 lecturers drawn from 70 colleges and 6 universities in its fi rst phase. It plans to increase the headcount at his centre to 5000 in a few years.

Satyam Computers Ltd

Satyam Computers is a global IT services company that offers end-to-end IT solutions. It is present in 55 countries, across six continents and employs nearly 45,000 IT professionals. It works with over 480 global companies, including over 150 Fortune 500 corporations. In Orissa, Satyam’s Bhubaneswar facility is a dedicated development centre for the company’s global customers. It has over 200 employees at this facility and plans to increase the number of employees in the near future.

Tata Consultancy Services Ltd

TCS is one of the world’s largest providers of IT, consulting, services and business process outsourcing. As of 2007, it was Asia’s largest IT services fi rm with annualised revenues of over $4 billion; its employee strength crossed 100,000. TCS has operations in Orissa in Bhubaneswar since 2001.

Wipro Technologies

Wipro Technologies is the global IT services arm of Wipro Ltd. It had more than 70,000 employees as of September 2007, and has over 300 customers across USA, Europe and Japan including 50 of the Fortune 500 companies. With revenues in excess of $3 billion, Wipro is one of India’s largest IT companies.

Tourism

Orissa has vast potential for the development of tourism, which is one of the critical sectors for the state economy in terms of foreign exchange earnings as well as creation of employment opportunities. During 2006, there were 1,153 hotels functioning in the state with 22,820 rooms and 43,828 beds. The government is setting up a special tourism area between Puri and Konark with the help of Indian Hotels Company, a leading hospitality chain, running hotels under the brand name Taj. The government is setting up a peace park and amphitheatre at Dhauli, a leading Buddhist tourist destination, at an estimated cost of over $2 million. In addition, Buddhist circuits are being developed at Ratnagiri, Lalitagiri, Udayagiri and Languli.

Puri, Bhubaneswar and Konark are the main centres for religious tourism. Bhubaneswar, the capital city, is known as the Temple City of India having about 500 temples. Puri is characterised by one of the largest sandy beaches of India and is host to the annual car festival (Rath Yatra), which is being positioned as an important tourist event. The Sun Temple of Konark (known as Black Pagoda of the east) is a 13th century architectural marvel. Asia’s largest salt-water lagoon, Chilika Lake, is another tourist attraction.

For development of the tourism sector, the State Government has taken initiatives to increase traffi c and to enhance their stay, ensure availability of tourism infrastructure and develop, promote and market Orissa as a tourist destination. The tourist infl ow in the state increased from 2.9 million in 2000 to 5.3 million in 2006 representing a 10.6 per cent CAGR. Earnings from tourism have increased from $213 million to $600 million, a representing a CAGR of 19 per cent in the same period.

ORISSA PAGE 25

The “Doing Business” database of the World Bank tracks a set of regulatory indicators related to business start-up, operation, trade, payment of taxes, and closure by measuring the time and cost associated with various government requirements. Bhubaneswar, the state capital, stands fi fth among the twelve state capitals of India that were studied by the World Bank.

According to the database of the World Bank, it costs the least to start a business in Bhubaneshwar when compared with the rest of India. Requirements vary considerably across states. It takes 159 days to fulfi ll all regulatory requirements to build a warehouse in Bhubaneshwar - the shortest within India. At the other end of the spectrum, it takes 522 days in Ranchi. The number of procedures is lowest in Bhubaneshwar (16) and highest in Patna and Ranchi (25). Within India, the shortest time needed to enforce a contract is in Bhubaneshwar (610 days). Contract enforcement costs the least in Bhubaneshwar (15% of the claim).

Approvals required for doing business in Orissa

Source: Team Orissa and Directorate of Industries, Orissa

Doing Business in Orissa

Approvals/Clearances required Departments to be consulted

Incorporation of Company Registrar of Companies

Registration/Industrial licence/Industrial Entrepreneurs

Memorandum (IEM)

District Industries Centres for SSI/Secretariat for Industrial Assistance

(government of India) for Large and Medium Industries

Allotment of land IDCO

Permission for land use in case industry is located outside an

industrial area

IDCO

Department of Town and Country Planning

Local Authority/District Collector

NOC and consent under Water and Air Pollution Control Acts Orissa State Pollution Control Board (OSPCB)

Forest & Environment Clearance Ministry of Forest & Environment, Government of India

Approval of construction Activity and Building plan Developmental Authority

Sanction of Electricity Distribution Companies-Central Electricity Supply Utility of Orissa

(CESU), NESCO, SOUTHCO, WESCO

Transmission Company- GRIDCO

Water Supply Water Resources Department

Factory & Boiler clearance Chief Inspector of Factories & Boilers

Finance OSFC/Commercial Banks like IDBI, ICICI Limited, SBI etc.

Orissa VAT Act, and Central and State Excise Act Commercial Tax Department; and Central and State Excise Department

Cost Estimates The cost involved in conducting business in Orissa are summarised in the following table:

Table 6: Cost estimates for doing business

Contact InformationInformation pertaining to investment opportunities or setting up a new business unit in Orissa can be obtained from:

Industrial Promotion and Investment Corporation of Orissa Limited (IPOCOL) and Team OrissaIPICOL House, Janpath, Bhubaneswar- 751022Phone: +91-0674-2542601Fax: +91-0674-2543766Email: [email protected] Website: www.ipicolorissa.com Directorate of IndustriesDirector of Industries, Orissa Killa Maidan,Cuttack-753001Phone: +91-0671-301892Fax: +91-0671-301227 Email : [email protected] Website: http://ws.ori.nic.in

Orissa State Finance Corporation (OSFC)O.M.P. Square, Cuttack- 753003Phone: +91-0671-2443659Fax: +91-0671-2443644/2444193Email: [email protected], [email protected] Website: www.osfcindia.com

Orissa Industrial Infrastructure Development Corporation or IDCOIDCO Tower, Janpath, Bhubaneswar- 751022Phone: +91-0674-2540820/2542784Fax: +91-0674-2542956Email: [email protected] Website: www.idcoindia.com

Confederation of Indian IndustryPlot No 8, Forest Park, 1st Floor, Bhubaneswar 751009Tel +91-0674-2531013Fax +91-0674-2530944Email [email protected] Web www.ciionline.org

Orissa Small Industries Corporation LimitedIndustrial Estate, Madhupatna, Cuttack- 753010Phone:+91-0671-2341458/2342404,2344612Fax: +91-0671-2341875Email : [email protected] Website: www.osicltd.com

Agricultural Promotion & Investment Corporation of Orissa Limited (APICOL)326, Baramunda, Bhubaneswar- 751003Phone: +91-0674-2561203/2561874Fax: +91-0674-2563306Email: [email protected] Website: www.agriorissa.com

Orissa Mining Corporation Limited(A Government of Orissa Undertaking)OMC House, Bhubaneswar- 751001Phone: +91-0674-2394578/778Fax: +91-0674-2391629Email: [email protected] Website: www.orissamining.com

AppendixExchanges rates used

Cost Parameter Cost Estimate Source

Industrial land (per sq mtr) US$ 2 to US$ 10 Team Orissa

Office space rent (per sq ft per month) US$ 0.2 to US$ 1.2 Industry sources

Residential rent (for a 2,000 sq ft house,

per month)

US$ 95 to US$ 200 Industry sources

5-star hotel room (per night) US$ 95 to US$ 150 Industry sources

Commercial & Industrial Electricity 7.5 cents/kWh to

10 cents/kWh

Department of Energy

Year One USD is equivalent to Rs.

2000 46.6

2001 48.3

2002 48.04

2003 45.6

2004 43.7

2005 45.2

2006 45

2007 42

ORISSA PAGE 27

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

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This publication is for information purposes only. While due care has been taken during the compilation of this publication to ensure that the information 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 professional 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 reliance 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

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May 2008

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