Submitted by:

Mohammad ZafarMBA - REUI, 1st Semester

I T S e c t o r O v e r v i e w

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Rajasthan, is surrounded on the north and north-east by the states of Punjab, Haryana and Uttar Pradesh; on the east and south-east by the states of Uttar Pradesh and Madhya Pradesh, and on the south-west by the state of Gujarat.

Rajasthan is the largest state in the country, area-wise, covering 10.4% of India’s land area. It however, accounts for just 5.7% of the country’s population, with a contribution of around 4.7% to India’s GDP; largely through the primary sector.

The state has grown at a robust 8.5% rate in the last five years (FY09 to FY13).

At the micro-level, the state records a per capita income of Rs 47,506 (as of 2011-12), lower than the national average level of Rs 60,603 for the same year, suggesting that there remains scope for benefits of growth to seep to the individual level; a critical aspect for a state that has been for long been classified as a BIMARU state.

Rajasthan- An Introduction

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Rajasthan- IT - Scenario

Rajasthan has a vast pool of trained professionals. Moreover, low cost of operations in well developed cities of the state makes them attractive locations for IT and ITeS units.

Rajasthan is emerging as one of the best locations in India to invest in the IT/ITeS sector.

IT parks with special infrastructure have been set up at Jaipur, Jodhpur, Udaipur, Kota and Alwar.

Computer software/services and ITeS exports from the state have expanded at a CAGR* of 18.9 per cent from FY 2008-09 to 2012-13 and stood at US$ 185.2 million in 2012-13.

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Rajasthan- IT - Scenario

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2/2

About 80 per cent of the IT/ITeS companies in Rajasthan are in the IT (software development and some in hardware manufacturing) segment compared to 20 per cent in ITeS.

Around 77 per cent of IT companies are involved in software development followed by 12 per cent in the BPO sector.

Employment in the IT sector is expected to reach 30,000 by 2015 from approximately 15,000 in 2010-11.

Software Development

B P O

Medical Transcription

Hardware

77%

8%

12%

3%

Fig: IT Companies in Rajasthan by Area of Operation

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Rajasthan- IT – Key Players 1/2

Infosys was set up in 1981; it is engaged in IT consulting, modular global sourcing, process re-engineering, and BPO services in India and several other countries Infosys BPO, the BPO services division of Infosys, has opened BPO campuses at the Mahindra Worldcity, Jaipur, Rajasthan.

Tech Mahindra is a global systems integrator and business transformation consulting firm focused on the communications industry. It provides a wide variety of services ranging from IT strategy and consulting to system integration, design, application development, implementation, maintenance and product engineering.

The company provides a wide range of business process, technology and knowledge services in finance and accounting, collections and customer relations, insurance, procurement and supply chain, analytics, software and IT infrastructure. It recorded a turnover of US$ 1.9 billion in 2012. The company employs about 60,200 professionals. It has a global operation centre is in Jaipur.

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Wipro Technologies was established in 1945; it is engaged in IT services, product engineering, technology infrastructure services, BPO and other consulting solutions. It recorded a turnover of US$ 6.9 billion in 2012-13. Wipro Technologies has set up a campus at the Mahindra World City in Jaipur.

Rajasthan- IT – Key Players 2/2

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Rajasthan- IT – Polices of State

Rajasthan Industrial and Investment Promotion Policy (RIIPP) 2010:

Improving the business climate through policy initiatives and systemic changes Developing high quality infrastructure Enhancing skill levels and employability by setting up training institutes in PPP Easy availability of land for projects

IT & ITES Policy 2007:

Land rebate up to 60%, depending upon type & size of investment Exemption of Stamp Duty on registration of land 50% Exemption from electricity duty for 7 years Simplified Labour Laws. (Women are allowed to work in night shift, self certification under various State enactments, etc.) Customized package for Investment beyond 10 crore. Venture Capital support

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Rajasthan- IT – Financial Support

Land rebate up to 60% depending on the type and size of investment 50% exemption from stamp duty on registration of land 50% exemption on electricity duty for 7 years. The captive power unit setup by eligible units will be exempted from payment of Electricity Duty 50% exemption on conversion charge payable for change of land use Training Incentives: Rs.2,000 per candidate to training centers provide training on communication/soft skills & whose candidates find placement in IT &ITES Companies Rebate for patent: Up to Rs.50,000 GoR would reimburse the ITC patent filing costs of individuals and non-profit organization with the condition that the patent right stays with the state A subsidy up to Rs.25 lakh at the rate of Rs. 10,000 per employee would be given to the first five IT/ITeS companies investing in the State and directly employing more than 50 employees in IT or 100 employees in ITeS sector. Mega project incentive: Rs.10, 000 per employee, projects that create employment of more than 500 people in the case of IT industry or 1000 people in ITES Industry.Simplified labour laws (for example women are allowed to work on night shifts)Floor Area ratio allowed upto 2.5 Investment Subsidy: 30% of taxes which have become due and have been deposited by the enterprises for 7 years (10 years for MSME) Capital Investment Subsidy of 50% of capital cost (up to INR 2 million) to BPO/KPO centers

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Operational SEZs

Company Name/Developer Location Primary Industry

Jaipur SEZ

Jodhpur SEZ

Mahindra Worldcity Ltd

Mahindra Worldcity Ltd

Mahindra Worldcity Ltd

Jaipur

Jodhpur

Kalwara Village, Jaipur

Jaipur

Jaipur

Gems and Jewellery

Handicraft

IT/ITeS

Engineering and related Ind.

Handicraft

SEZs with formal approvals

Company Name/Developer Location Primary Industry

Somani Worsted Ltd.

Mansarovar Ind. Development Corp

Vatika Jaipur SEZ Developer Ltd.

RNB Infra Pvt. Ltd.

Mahindra Worldcity Ltd.

Mahindra Worldcity Ltd.

GENPECT India

Mahindra Worldcity Ltd.

Mahindra Worldcity Ltd.

Mahindra Worldcity Ltd.

Khushkera Ind. Area, Bhiwadi

Jodhpur

Jaipur-Ajmer Expressway

Bikaner

Jaipur

Jaipur

Jaipur

Jaipur

Jaipur

Jaipur

Electronics/Software/ITeS

Handicraft

IT/ITeS

Textile

Handicraft

Light Engineering

IT/ITeS

IT/ITeS

IT/ITeS

Gems and Jewellery

Rajasthan- IT – Development Projects

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Rajasthan- IT – Investment Mechanism

Single Window Approval: Rajasthan Single Window Clearance System is a single point of contact to reduce the time and efforts involved in various clearances and approvals of layouts/applications for the proposed investment, submitted by investors.

Bureau of Investment Promotion: Bureau of Investment Promotion (BIP) is a nodal agency of the Government of Rajasthan that facilitates investments in various sectors in the state. It provides one-stop service mainly for large projects, by acting as an interface between entrepreneurs and the government.

Rajasthan State Industrial Development and Investment Corporation (RIICO): RIICO is the sole agency in the state that develops land for industrial growth. It provides financial assistance and other vital infrastructural facilities for industries.

Rajasthan Financial Corporation (RFC): RFC provides medium and long-term loans for new industrial units in the SME sector. It also assists in planning a balanced development of industries in the state.

PDCOR Limited: PDCOR Limited (PDCOR) is a company jointly promoted by the Government of Rajasthan (GoR) and Infrastructure Leasing & Financial Services Limited (IL&FS) to facilitate private sector investment in the infrastructure sector in the State of Rajasthan.

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Permission and Clearance

Required

Respective Department of State Time limit within working Days

Land Conversion Revenue Department

Up to 10 hectares: 30 days from submission of

completed application to district collector.

Above 10 hectares: 60 days from submission of

completed application to state government.

Land Allotment

In case the allotment is to be made at the district

level: 30 days from submission of completed

application to district collector.

In case government’s approval is required: 60 days

from submission of completed application to state

government.

Exemption in Land Ceiling

Limit

60 days at the level of state government from the

date of submission of application in the district

collector’s office

Sanction of Loan

Rajasthan State Industrial Development and

Investment40 Days

Allotments of Plot Corporation (RIICO) 30 Days

Reg. under VAT Act

Commercial Taxes Department

24 Hours

Reg. under CST Act 24 Hours

Tax Clearance Cert. 1 day in case of non default of payment

Rajasthan- IT – Key Approvals Required

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Rajasthan- IT – Cost of doing Business in Rajasthan

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Rajasthan- IT – Case Study on Mahindra Worldcity, Jaipur

In partnership with RIICO, Mahindra & Mahindra Group has established Mahindra World City (MWC), a multi-product SEZ in Jaipur with an area of 3,000 acres endowed with high quality infrastructure. Till date, MWC has over 25 customers, including Infosys, Wipro, Deutsche Bank, ICICI Bank, QH Talbros, Connexions, Nagarro Software and Tech Mahindra.

The IT zone in the Mahindra World City is spread over 750 acres, India's largest IT SEZ with plug-and-play facilities and robust connectivity.

Promoted in a PPP between the Mahindra Group and RIICO (a Govt. of Rajasthan undertaking), Mahindra World City, Jaipur is at par with the best business destinations in the world.

Spread across 3,000-acres with a 2,500-acre multi-product SEZ, the Mahindra City serves as a conduit between entire North India and the ports of the Western coast.

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Rajasthan- IT – Advantages and Disadvantages

Disadvantages :The FDI inflows have not been that impressive for the state. Jaipur is positioned much below the other regions of India like Mumbai, New Delhi, Bangalore, Chennai, and Kolkata. The effectiveness of the existing physical planning is hampered by the lack of a coordinated state development plan, inadequate resources and institutional weaknesses. Government Instability.

Advantages:The State currently has 126 registered STPI units (2010-11) including key playersA highly attractive and competitive incentive package Rajasthan has an abundant talent pool with over 1,300 higher level educational institutions with an annual intake capacity of over 4.2 lakh students. The State offers lower manpower costs, lower staff attrition rates, lower land and office space costs and access to large pool of relatively untapped educated professionals. Costs for IT professionals in Rajasthan such as software analysts and project coordinators are approximately 15-20% lower compared to NCR. It is estimated that by 2018 about 40% of employment in the sector will be in Tier-2 and Tier-3 areas compared to less than 10% today.

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Rajasthan- IT – References

http://www.rajasthan.gov.in/StateProfile/BusinessOpportunitieshttp://www.mahindraworldcity.com/jaipurhttp://investrajasthan.com/special-economic-zones.cms

Thank You