INDIAN STATE : RAJASTHAN

Major Industries

Information Technology and IT enabled Services

Software and services exports continued to remain on top of the IT industry's revenue. The export- driven software sector saw major long-term projects come to Indian ICT leaders and Indian Companies bagging a larger and larger share of the global outsourced business. As per the projections of NASSCOM, Indian IT and ITeS market will be of $62 billion by 2009 and US$ 148 billion by 2012. The growth in IT and ITeS market in India will translate to manpower requirement estimation of 9.72 lacs for IT export services and 27.17 lacs for ITeS export services by 2012.

The state of Rajasthan offers huge investment opportunities in IT sector especially ITeS. Rajasthan State Industrial Development and investment Corporation Limited (RIICO) has developed state of art IT parks at Jaipur, Kota, Udaipur and Jodhpur to attract investment in IT sector. RIICO is also considering developing such IT parks at Bhiwadi (Alwar). The infrastructure in terms of developed plots, continuous power High-Speed Data Com Facility through satellite earth station, road etc. are being made available to the IT industries in IT parks.

Rajasthan has attracted an investment over Rs. 1000 crores in IT and Electronics sector in over 60 projects. RIICO has extended financial assistance of over Rs. 50 crores to the sector. The turnover of this sector is over Rs. 1500 crores with export of over Rs. 125 crores. It is projected that by 2008, the export from the State in IT and Electronics sector would be over Rs. 500 crs. The major industries are Electrolux, Ericsson, GE, Samcor, Instrumentation, Rajasthan Electronics & Instruments (REIL), Genus overseas, Allied Electronic, Compucom, Cistems software, Lipi Data, Aksh Optifibre etc.

An investor friendly IT policy is already in place and provides lucrative incentives to IT industries. The following concessions are being available to the IT parks:

• Land rebate upto 60 percent depending upon type and size of investment
  
• Exemption of stamp duty on registration of land
  
• 50 percent exemption from electricity duty for 7 years
  
• Simplified labour laws
  
• Customized package for investment beyond Rs 10 crore
  
• Venture Capital (on merit)

Bio Technology

A new generation of biotechnology developed as a result of intensive work in India has opened up new opportunities for economic development in the country.

The country is also rapidly emerging as a major market for biotech products. The current consumption of biotechnology products in India is of the order of Rs. 90 billion, which is expected to increase to Rs. 234 billion by 2010. The healthcare sector would contribute 38% of the market, agriculture 32% and industrial products 30%. The small-scale sector is expected to play a major role in the growth of the biotech industry.

Rajasthan is very rich in Bio resources. The State provides tremendous bio diversity, rarely to be found in any other State. Rajasthan is very rich in cattle breed also. State has highest livestock population and there is good potential in animal husbandry and genetic engineering. Thus Rajasthan has great potential to create immense industrial activity in Biotechnology and modern Biotech products involving recombinant DNA based products and Bio Informatics.

To attract investment in BT sector, RIICO is considering developing State of Art Bio Tech Parks at Jaipur, Jodhpur and Bhiwadi (Alwar). The infrastructure in terms of developed plots, continuous power, High Speed Data Com Facility, Roads, common testing facility etc. are being developed in Bio Tech Parks.

Investment Opportunities in Biotechnology in Rajasthan

• Research and development in the cattle species improvement programme and Biotechnology incubation centers
  
• Bio-pesticides and bio-fertilizers
  
• Genetic improvement of seeds
  
• Genetic improvement of animal breeds
  
• Dry farming
  
• Treatment of industrial effluents
  
• Recycling/recovery of bio-products
  
• Waste management
  
• Bio fuels/energy
  
• Industrial enzymes
  
• Fermentation products for better yeast

The State's new Biotech Policy proposes major incentives to Biotech (BT) Units:

• 100% exemption from Stamp Duty for registration of land in designated RIICO BT Parks. In other areas, it would be 50% only.
  
• Bio- informatics and biotechnology R&D units being non- polluting by nature may be allowed to be set up in the residential areas and in the BT parks as well.
  
• Biotechnology industries will be treated as industrial (and not commercial) consumers and electricity tariff applicable to the industrial consumers will be levied on such industries.
  
• BT industries will be exempted from seeking permission for installation of DG sets from Discoms.
  
• Captive power generation plants installed by the Biotechnology Industry will be eligible for total exemption from electricity duty.
  
• The Biotechnology Industry will get 50% exemption of electricity duty for seven years.
  
• Purchase Tax on capital goods in BT parks of RIICO would be set off against the RST/CST paid in the State. This benefit will be allowed for all BT units in the State irrespective of their location.
  
• Entry tax on all inputs as well as capital goods including captive generation set will be exempted during the implementation stage of the project for a period of five years or till the date of completion of the project which ever is earlier.
  
• 5% Interest Subsidy and 25% Wage/employment subsidy would be subject to maximum limit of 75% of the tax payable and deposited under RST, CST and VAT. The subsidy shall be for seven years.
  
• Government of Rajasthan will give 50% exemption from conversion charges.
  
• Labour laws relaxed.
  
• The State Government will offer customized package of incentives for large Biotechnology Projects e.g. projects where investment is more than Rs.100 million or a Fortune 500 company is implementing the project. The customized package would be decided by the Board of Infrastructure Development & Investment Promotion (BIDI)/State Level Empowered Committee (SLEC) on case-to-case basis.
  
• For strengthening of biotechnology infrastructure in the State, Government of Rajasthan will set up a Development Fund, with an initial corpus of Rs.500 million.
  
• Biotechnology industries shall be exempted from routine inspection by inspectors like factories & boilers, excise, labour, pollution, environment, industries etc.

Agro Based Industries

Rajasthan, being leading producer of bajra, barley, pulses, coriander, Cummins and a number of ayurvedic herbals, offers huge potential for agro-based industries. The government of Rajasthan has given utmost priority to and attention for development of agro-food parks. The following concessions are being provided to the units located in agro food parks developed by RIICO:

• Exemption of land and building tax
  
• Exemption of stamp duty
  
• Exemption of electricity duty for 5 years
  
• Public Utility Status
  
• Exemption from entry tax on raw materials
  
• Set off of sales tax on capital goods
  
• Set off of entry tax on capital goods
  
• Exemption of Mandi Tax

Mineral based Industries

Rajasthan is the county's second largest mineral producing state after Bihar. 42 major and 23 minor minerals are produced in the state. Abundant availability of minerals such as limestone, zinc concentrate, gypsum, fluorite, asbestos, calcite, wollastonite, jasper, garnets, marble, lead & tungsten concentrates, phosphate rock, clay, soapstone, sandstone, limestone and feldspar. Substantial quantities of lignite and natural gas have also been identified in the desert areas of the state. Rajasthan is already exporting wollastonite, soapstone and a variety of dimensional stones. Export oriented units are given a priority while granting mining leases.

Rajasthan is among the largest producers of cement in the country. The demand for cement is expected to grow at the rate of 8 to 9 percent annually to reach 160 million tonnes by 2006-2007. This would result in a demand for 3 million tonnes in Rajasthan alone. Large reserves of clay and silica sand, raw materials for the ceramic and refractory industry, are available in the state. Further, the state has locational advantage as large north Indian markets for ceramics is easily accessible from the state. With about 185 million tonnes of rock phosphate reserves in the state, manufacture of phosphoric acid/DAP is a viable venture.

The discovery of natural gas in the state has opened up possibilities for additional investment in the chemical and ceramic sector.

There is also a good potential for locating new base metal deposits. Accordingly, beneficiation and smelting plants may be set up based on newly located deposits at an investment of Rs 400 crore. One zinc smelter is expected to come up between 2010 and 2020, and one lead smelter after 2010.

Rajasthan has enormous resources of Dimensional Stones that are widely spread all over the state. The estimated reserves are as follows:

Marble -1100 million tons
Sandtone-900 million tons
Flaggy limestone- 1800 million tons
Slate- 50 million tons