Dynamic City-Regions in India Presentations for five (5 ... - Unido

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important bearing on the pattern of regional growth both directly and through their effects on the distribution of private investment. Within the political boundaries of the states the industries are more concentrated in Andhra Pradesh, Gujarat, Haryana, Karnataka, Kerala, Maharashtra, Punjab and Tamil Nadu. And it is relatively less concentrated in Assam, Bihar, Madhya Pradesh, Orissa and Rajasthan. Geographically, the forward groups of states fall in the western and southern parts of the country and are contiguous except for Punjab and Haryana, which are separated by Rajasthan from the rest of the states in this group. The groups of backward states are in the eastern and northern parts of the country and are geographically contiguous. India has implemented a series of policy changes since the mid-1990s to encourage foreign investment. The industrial policy reforms secured the reduction of the industrial licensing steps, removing restrictions on investment and expansion, and facilitating easy access to foreign technology and foreign direct investment. • Credit Policies 1. Priority for credits/lending is to Small Scale Industries (SSIs). 2. 40 per cent of advances to SSI sector reserved for tiny sector and village and cottage industries. 3. Concessional/fixed rate of interest of loans up to Rs. 2 Lakh. 4. Computation of working capital limits on the basis of minimum of 20% of projected annual turnover for SSI units with fund based working capital requirement up to Rs. 100 Lakh. The Action Plan for improving the flow of credit to SSI sector initiated in 1995-96, consisting of: 1. Time bound action for setting up specialised SSI branches in 85 identified districts. At least, 100 of such dedicated branches were opened before the end of 1995-96. 2. Adequate delegation of powers at all levels. 3. Banks to conduct sample surveys of the performance of their SSI accounts to find out whether they are getting adequate credit. 4. Steps to be taken to ensure that composite loans (covering both term loans and working capital) are sanctioned to SSI entrepreneurs as far as possible. 5. Regular meetings by banks at zone and regional levels with SSI entrepreneurs. 6. Need to sensitise bank managers and reorient them regarding working of the SSI sector. 7. Simplification of procedural formalities by banks for SSI entrepreneurs. 8. Scope of National Equity Fund (NEF) scheme providing equity type assistance at 1% service charge to cover whole country to support expansion, modernisation and technology up-gradation. 9. Technology Development & Modernisation Fund (TDMF) scheme launched for modernisation, improve and update technology to export oriented units. • Policy tools Removal of all import restrictions maintained for balance-of-payments reasons. As a result, the customs tariff has become the main form of border protection. Tariffs are relatively high, but the average applied MFN 7 rate fell from 35.3% to 32.3% between 1997/98 and 2001/02 and is expected to fall further, to 29% in 2002/03, as the “peak” rate of tariff is reduced from 35% to 30%. The banking sector has been subject to gradual reform since the early 1990s. This includes measures to reduce the level of non-performing loans, especially in public-sector banks, and to restructure three public-sector banks. The Reserve Bank of India, which regulates the banking sector, has also strengthened prudential requirements, including raising minimum capital and capital adequacy ratios. The insurance industry has recently been opened to competition from the private sector and new licences have been issued to private companies; foreign equity is restricted to 26% of the total. The role of the regulator, the Insurance Regulatory and Development Authority (IRDA), has been enhanced. The reforms have concentrated on addressing the issue of cross-subsidization of tariffs, through the establishment of regulators and reform of the subsidy bodies; in addition, foreign investment restrictions in transmission were removed. Restrictions on foreign ownership have been relaxed. Previously, foreign ownership usually had been limited to a minority ownership stake. Now, in many sectors, majority foreign ownership is permitted. A number of policy measures have been announced by the Reserve Bank of India to ensure that genuine production activities get adequate credit. These include: 1. Substantial scaling down of cash reserve ratio (CRR), 2. Raising of export credit limit, 3. Permitting commercial banks to provide foreign currency denominated loans, 4. Reduction in Prime Lending Rates (PLR) and announce the maximum spread over PLR by banks. 7 Most-favoured-nation treatment (MFN) is a general obligation that applies to all measures affecting trade in services. 8
4. Incentives and Facilities for Small Scale Industries • Incentives to new industrial units and substantial expansion of existing units: Incentives to new Industrial Units and substantial expansion of existing units whereby new industrial units and existing industrial units under expansion set up in growth centre, industrial infrastructure development centres and other locations like industrial estates, parks, Export Processing Zones (EPZs), commercial estates, etc., are entitled to 100% excise duty exemption for a period of 10 years from the date of commencement of commercial production. All New industries in the notified locations would be eligible for capital investment subsidy at 15% of their investment in plant & machinery, subject to a ceiling of Rs. 30 Lakh 8 . The existing units will be entitled to this subsidy on substantial expansion, as defined. An interest subsidy of 3% on the working capital loan would be provided to all new industrial units in notified locations for a period of 10 years after commencement of commercial production. This benefit would also be extended to existing units in notified locations on expansion, as defined, as well as to notified Thrust Industries. The insurance premium to the extent of hundred percent on capital investment for a period of 10 years would be extended by the Central Government to all new units and to existing units on substantial expansion. The financing pattern for development of integrated industrial infrastructure will change from 2:3 between Government of India (GOI) and Small Industries Development Bank of India (SIDBI) to 4:1 and the GOI funds would be in the nature of a grant, so as to provide the required infrastructure support. • Fiscal Incentives: Excise concessions available for both registered and unregistered units on a graded scale depending on turnover up to Rs. 30 Lakh: - 1. Full exemption up to a turnover of Rs. 30 Lakh and concessional rate of excise duty for a turnover in excess of Rs. 30 Lakh but not exceeding Rs. 75 Lakh and normal rate of duty thereafter. 2. Investment ceiling on plant and machinery for SSI units has been raised from Rs. 60-75 Lakh to Rs. 3 Crores and for tiny units from Rs. 5 Lakh to 25 Lakh. 3. Export obligation of non-SSI units producing reserved items has been reduced from 75% to 50%. 4. Price and purchase preference to products manufactured in small-scale sector in Government purchase programme. 5. Infrastructure support to Entrepreneurship Development Institutes (EDIs) to augment their training capacities. 6. Joint programme with the State Bank of India (SBI) and Small Industries Development Bank of India (SIDBI) for modernisation and technology up gradation of industry cluster. 7. Assistance to industrial associations/voluntary agencies to set up testing centres. 8. Special programmes on vendor development, quality awareness and pollution control. 9. Integrated Infrastructure Development (IID) scheme was launched in March 1994 to strengthen infrastructure facilities in rural and backward areas. 20 projects have been sanctioned so far. 10. Quality certification scheme to improve SSI product quality. Financial support to acquire ISO 9000. 11. A scheme for creation of technology development fund in the States launched with the involvement of the State Government and Industry associations. 5. Support Institutions The investment in Research and Development (R&D) has increased from Rs. 20 Crores in the First Five Year Plan to about Rs. 20,000 Crores in the Eighth Five Year Plan. Presently there are 214 universities, 400 national laboratories and 1300 in-house R&D centres in the industrial sector. Several Science & Technology departments have been set up in the areas of environment, non-conventional energy resources, biotechnology, ocean development, industrial research, space, atomic energy, defence, health, agriculture, information technology and electronics. With their HQ at New Delhi the following institutions provide support to the industrial community in the country: 1. Science and Engineering Research Council (SERC): set up under the Department of Science & Technology (DST) to identify and promote priority areas in R&D as well, for furthering research work in several disciplines. DST supports 12 autonomous research institutions. 2. Technology Information Forecasting/Assessment Council (TIFAC): has been set up for generating technology forecasting and technology assessment documents and enabling a technology information system that is interactive and nationally accessible. 3. Industrial research in several diverse fields of scientific activity is being undertaken through a network of 40 laboratories and 81 field stations set up by the Council for Scientific and Industrial Research (CSIR). In the field of biotechnology, more than 24 specialised R&D centres have been developed for pursuing state-of-the-art research. Identical efforts for promoting new avenues of research are being undertaken in the field of ocean development as well. 4. The Entrepreneurship Development Institute of India (EDI): set up in 1983, is an autonomous institution registered under the Societies Registration Act and sponsored by all India financial institutions viz., 8 Lakh = 100,000 9
Page 1 and 2: Dynamic City-Regions in India Prese
Page 3 and 4: PRESENTATION NO. 2:................
Page 5 and 6: PRESENTATIONS 1 SELECTED DYNAMIC CI
Page 7: Figure 1. Sample of Dynamic City Re
Page 11 and 12: entrepreneurship and professional e
Page 13 and 14: Nature of Fund: Offshore fund Date
Page 15 and 16: Karnataka State is a leading State
Page 17 and 18: Figure 5. Growth of Software Export
Page 19 and 20: 5. 1997-Govt. of Karnataka 1 st one
Page 21 and 22: everyday. As a result, offshore see
Page 23 and 24: 3. The Technical Consultancy Servic
Page 25 and 26: 2. Private venture Capital Organisa
Page 27 and 28: Chennai attraction Chennai (formerl
Page 29 and 30: Featuring Textile/ready-made garmen
Page 31 and 32: usiness zones with an infrastructur
Page 33 and 34: Brief History of Pune and Maharasht
Page 35 and 36: ) Pune population Population: Perso
Page 37 and 38: The 3 main Industrial Clusters/Sect
Page 39 and 40: 12. Indian Rubber Manufacturers Res
Page 41 and 42: 10. International IT Park 11. Khara
Page 43 and 44: Brief History of Vadodara city and
Page 45 and 46: 4. The highest number of investors/
Page 47 and 48: 6. Gujarat Industrial Devlop’t Co
Page 49 and 50: Figure 19. Location of Delhi in Ind
Page 51 and 52: The private sector is playing a big
Page 53 and 54: 3. Soft Drinks, 4. Sports Goods, 5.
Page 55 and 56: Facilities Health Club, Recreation,
Page 57 and 58: Please refer to Women’s Study For
Page 59 and 60:
Venture Capital: Micro (Tiny) Indus
Page 61:
Bibliography 1. http://www.bisnetin
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