Odisha – Unleashing its potential

Sanjeev Chopra, IAS, Principal Secretary, Department of Industries, Government of Odisha

“Paradeep, Kalinganagar and Bhubaneswar in due course will offer the least logistics cost in the country,” affirms Sanjeev Chopra, IAS, Principal Secretary, Department of Industries, Government of Odisha, as he elaborates on the digital initiatives of the state government for ease of doing business

QHaving rich mineral deposits, how is Odisha leveraging on this advantage?

One of the policies of the central government after the independence was the freight equalisation policy which mandated that the minerals produced will be available at the same price (landed price) across the country. This meant that the advantage that Odisha had in terms of its natural resources was lost, because whether you are setting up a plant in Cochin or Coimbatore, the cost of the mineral will remain the same. As a result the eastern states, particularly Odisha which has most of the mineral resources lost out in the value addition race. This policy was done away some time in the 1990s and then on Odisha has made strides ensuring value addition to the minerals that it is producing.

 In other sectors as well Odisha has made progress. This state is number one in attracting manufacturing investments and also in fastest implementation of investments. The state also ranked first in the smart city challenge in 2016. Paradip is the second largest port in the state in terms of capacity. It has just handled 100 million tonnes of cargo this year and if things proceed in a progressive manner, then it will soon step up to the first position. Odisha is today the gateway on the east coast. If you are looking for trading or any activity, Odisha offers tremendous opportunities in terms of the ports in Paradip, Dhamra and upcoming port at Gopalpur which is just taken over by Shapoorji Pallonji.

QTell us about the economic growth in the state?

In terms of the economic growth rate we are above the national average and as per the estimates of Dun & Bradstreet we will be growing by around 12 per cent by the year 2020-21. While we are aware that Odisha actually is home to major mineral deposits, but the fact that we are the only coastal state with such vast natural resources is not realised. Be it Jharkhand, Chhattisgarh or West Bengal, there is no state which has these kind of natural resources and also a coastline with three ports operational and another ten in the offing.

 QEach state in India today is flagging its ease of doing business initiatives to attract invest-ments. How does Odisha fare on this parameter?

In terms of ease of doing business we have actually focused on ground implementation. One of our portals “Goswift” which stands for Government of Odisha Single Window Investor Facilitation and Tracking, is the only portal of its kind in the country that serves all the G to B interaction or interface during the entire investment lifecycle.

When you plan to make an investment in the state, by answering a few questions it will tell you what are the incentives available and the regulations to be followed. Another application is “infowizard” which helps right from identifying the land to getting single window clearance, approvals and the entire gamut of activities that the investor would probably need to interface with the government. The entire thing is captured in one single portal that covers the entire investment lifecycle.

 In terms of cost of doing business in Odisha, as compared to other states, (considering the cost of land, power tariffs, wages and cost of living) we are the most competitive in the entire country. Companies across sectors are now moving to Odisha because the cost of doing business is 10 to 20 per cent less as compared to the neighbouring states, and this creates a very compelling value proposition for them. To leverage technologies in the best possible manner we have made it a policy that investors should have minimum physical interface with the government. The investor need not approach the government for a meeting in-person unless required.

So most of the things regarding getting the approvals and clearances should happen online.

The state government has created a land bank of 1,21,000 acres of which 62,000 acres has been categorised into category A&B. Category A consists of land that is readily available for allotment with IDCO, the state government arm for infrastructure development and the balance land is reserved for industries. In addition to this land bank all the industrial clusters are mapped on a GIS based platform. This is the most comprehensive GIS-based land bank in the country where an investor can search for the most optimum location and its proximity to various services such as airport, railway lines.

 In the eastern part of the country we are the education hub. I don’t think there is any other state capital in the country with the type of higher educational and research institutions as those present in Bhubaneswar. For skill development, the state government has initiated “Skilling Odisha” programme and workers trained under this programme will get a premium in the job market.

 QHow is the industrial development progressing in the state?

 In the past two decades there has been a flurry of industrial activities with huge plants for steel and aluminium coming up. We are now the number one producer of stainless steel and aluminium in the country. The state government is trying to go one step further and ensure that we are able to add value to the mineral ore. A major initiative is to convert metal into downstream products for which one aluminium park is established in Angul with the help of National Aluminium Company. This is the only facility in South Asia where molten metal will be available to the industry. Similar facility is being made available by Vedanta at Jharsuguda. For stainless steel, Jindal Steel is setting up a private industrial park for downstream applications of stainless steel. Tata Steel is also planning a similar downstream park where hot metal can be made available at Kalinganagar.

The objective of these initiatives is that we should be able to add value to atleast 50 per cent of metal we are producing in the state. Then chemicals, plastics and petrochemicals is anchored by the IOCL refinery at Paradeep, as part of the petroleum, chemicals and petrochemicals investment region. Verticals on which the state government is giving more focus than others include agriculture, seafood processing, textile and apparel, electronic manufacturing and tourism.

 One policy of the government that has got us very good results is to offer land to private sector and let them set up industrial clusters. Traditionally industrial estates are set up by the government, but we have a policy wherein we are inviting the private sector to set up industrial estates. The state government gives them land at a concessional rate, infrastructure such as road, water and power supply up to the gate of the park and for the internal infrastructure, the government subsidises the cost up to 50 per cent. The government also allows the 20 per cent of the allotted land to be used for residential/commercial complex, hospital and school, in order to promote the concept of walk to work.

 For all these sectors we have framed supporting policies, put in place the infrastructure, human resources with the required skill set, the MSME promotions that are required are happening as well. By the year 2025 the state government plans to attract an investment of 2.5 lakh crore of investment.

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While we are aware that Odisha is home to major mineral deposits, but the fact that we are the only coastal state with such vast natural resources is not realised. Be it Jharkhand, Chhattisgarh or West Bengal, there is no state which has these kind of natural resources and also a coastline with three ports operational and another ten in the offing.

QHow is the response in terms of investments?

Out of the 92 MoUs that were signed in 2004-05, 46 have materialised, which translates into conversion of 50 per cent of MoUs into actual projects. In “Make in Odisha” event in 2016 we got 124 proposals worth `3.64 lakh crore. 76 of these proposals are now under implementation or at some stage of approval.

 QHow is the logistics infrastructure being developed?

Paradeep, Kalinganagar and Bhubaneswar in due course will offer the least logistics cost in the country. There are three large investment regions coming up – Kalinganagar investment region, PCPIR at Paradeep and IT investment region at Bhubaneswar. This will be part of the east coast economic corridor extending from Vizag to Kolkata. The spine of this corridor is the national highway connecting Chennai to Kolkata. The only commercially viable waterway no 5 on river Mahanadi will connect the coal belts to ports at Dhamra and Paradeep. The area between Paradeep and Dhamra is pitched as the first coastal economic zone in the country.

Concor is coming up with a container terminal at Paradeep and is also setting up an MMLP close to Jajpur. The National Aluminium Company has just inked a MoU with a Canadian company for setting up automotive grade aluminium plant. Rourkela Steel plant is producing automotive grade steel. Earlier Odisha could not attract auto manufacturers into the state, further the eastern part of the country does not has much auto manufacturing activity, so the effort is to attract auto manufacturers into this region.

Boosting green energy generation, Hindalco is setting up a solar power unit and many more are coming up in southern and western part of the state. We are also planning to come up with a defence manufacturing policy to promote defence manufacturing sector in the state.