Gujarat Industrial growth

Mar 25, 2013 | | Say something

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Industrial growth

Gujarat’s major cities include Ahmedabad, Surat, Vadodara,Palanpur,Rajkot, Jamnagar, Junagadh, and Bhavnagar. In 2010, Forbes list of the world’s fastest growing cities included Ahmedabad at number 3 after Chengdu and Chongqing from China.Major resources produced by the state include cotton, groundnuts, dates, sugarcane, and petrochemical products. The state is rich in calcite, gypsum, manganese, lignite, bauxite, limestone, agate, feldspar, and quartz sand, and successful mining of these minerals is done in their specified areas. Gujarat produces about 98% of India’s required amount of soda ash, and gives the country about 78% of its national requirement of salt. It is one of India’s most prosperous states, having a per-capita GDP significantly above India’s average. Kalol, Khambhat, and Ankleshwar are today known for their oil and natural gas production. Dhuvaran has a thermal power station, which uses coal, oil, and gas. Also, on the Gulf of Khambhat, 50 kilometres (31 mi) southeast of Bhavnagar, is the Alang Ship Recycling Yard (the world’s largest). General Motors manufactures its cars at Halol near Vadodara, Tata manufactures Nano from Sanand near Ahmedabad, and AMW trucks are made near Bhuj. Surat, a city by the Gulf of Khambhat, is a hub of the global diamond trade. In 2003, 92% of the world’s diamonds were cut and polished in Surat.

Gujarat passed an act for the SIRs and set up the first such hub—Petroleum Chemical and Petrochemical Investment Region (PCPIR) spread across 453,000 square hectares—in Bharuch 2009. SIRs are special regions spread over a minimum 50,000 hectares where industries can buy lands directly from local owners. They are not offered concessions like tax benefits as in SEZs. However, the main benefit of SIRs is that they provide quality infrastructure and development even before units become operational. In every SIR, 55% of the area is to be set aside for residential townships and other non-processing units.

During the period of 1960–90, Gujarat established itself as a leader in various industrial sectors, including textiles, engineering, chemicals, petrochemicals, drugs and pharmaceuticals, dairy, cement and ceramics, and gems and jewellery, amongst others. A post-liberalization period saw Gujarat’s State Domestic Product (SDP) rising at an average growth rate of 14% per annum in real terms (from 1994–2002). Gujarat achieved as much as 35% of augmentation in its power generation capacity during the periods 1995–96 and 2000–01. The producers (IPPs) have contributed significantly in this addition. Gujarat is one of the first few states in India to have encouraged private-sector investment, some of which are already in operation. In addition, the liquid cargo (chemicals) handling port at Dahej is also set up in joint sector and made operational. At an investor’s summit entitled Vibrant Gujarat, arranged between 10 January and 13 January 2007, at Science City, Ahmedabad, the state government signed 104 Memoranda of Understanding for Special Economic Zones worth a total of INR 2.5 lakh crore.However, most of the investment was from domestic industry. In the fourth Vibrant Gujarat Global Investors’ Summit held at Science City, Ahmedabad, in January 2009, there were 600 foreign delegates. In all, 8668 MOUs worth INR 12.5 lakh cr were signed, estimated to create 25 lakh new job opportunities in the state. In 2011, Vibrant Gujarat Global Investors’ Summit MOUs worth INR 21 trillion (US$ 463 billion) were signed.

Gujarat is the only state with surplus electricity. Recently, the Gujarat Government has upgraded its installed capacity of 13,258 megawatts (MW) by adding another 3,488 MW. According to the official sources, against demand of 40,793 million units during the nine months since April 2010, Gujarat produced 43,848 million units. Gujarat sold surplus power to 12 states: Rajasthan, Tamil Nadu, Uttar Pradesh, Maharashtra, Andhra Pradesh, Delhi, Haryana, Karnataka, Chhattisgarh, Uttarakhand, Madhya Pradesh, and West Bengal.

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Gujarat invests in development of solar energy in the state and has had India’s largest solar power plant as of January 2012. It has allotted 716 MW of solar power capacity to 34 national and international solar project developers in 2009, against the planned 500 MW capacity under its solar power policy. This is expected to bring in investments of INR 12000 crore and generate employment for 5,000 people. By 2014, Gujarat plans on producing 1000MW of energy by solar power. When taking all renewable energy sources into account, Gujarat has the highest share of renewable energy sources in India, about 14% (12,489 MW ).

As per a recent survey report of the Chandigarh Labour Bureau, Gujarat has the lowest unemployment rate of 1% against the national average of 3.8%.

It also has the biggest industrial area for ceramic business in Morbi, Himatanagar, which produces around 80% of the country’s gross ceramic production and around 80% of compact fluorescent lamp (CFL).

Legatum Institute’s Global Prosperity Index 2012 has recognised Gujarat as the highest-scoring among all states of India on matters of social capital. The state ranks 15th alongside Germany in a list of 142 nations worldwide, and actually ranks higher than several developed nations.

“India ranks 138th globally in the Social Capital sub-index, however, disaggregation of the data at the sub-national level reveals large differences within the country. Within India, the states of Gujarat and Uttarakhand have the highest social capital scores and would rank 15th and 18th, globally, in this sub-index, next to Germany and Belgium, respectively. In the state of Gujarat, 77% of respondents can rely on friends and family for help and 51% have donated money to a charity.

The London-based Legatum Institute is an independent non-partisan public policy organisation that covers the global assessment of 96% of the world’s population and 99% of the global GDP. The study benchmarks the participating countries in eight categories: economy, education, entrepreneurship and opportunity, governance, health, personal freedom, safety and security and social capital.

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