Information technology

Gujarat : An Enduring Strong Economy
Population : Over 50 million (5.0% of India) Geographical area : 1 96 000 sq. k (6 2% of I di ) G hi l 1,96,000 km (6.2% f India) Gross State Domestic Product (GSDP) : US$45.3 billion Per capita income : US$914 (The per capita income at current prices has been estimated at US$914 in 2006-07 which is higher than the national average of US$722) Urbanisation : 37.4%

Composition of GSDP as per economic activity High industrial growth : Gujarat has demonstrated a high industrial growth 12.5% rate from 2002 -2007 High industrialisation : Gujarat is home to 800 large industries d i d t i and over 3,20,000 micro, small and medium 3 20 000 i ll d di industries
Source: Socio Economic Review 2007-08 2007 08 Growth Rate in 2006-07 Primary sector Secondary sector Tertiary sector
37.8% 44.0% 18.2%


Gujarat : A Thriving Industrial State
Contribution to India's C t ib ti t I di ' economy
Employees No. of Factories Net value added by manufacture Value of output Fixed capital investment Exports Coastline Stock market capitalization 9.5% 10.0% 14.0% 15.6% 17.0% 19.2% 22.0% 30.0%

Presence across industry sectors P i d
Petroleum products Chemical & Pharma Engineering Food processing Textiles & Apparels Mineral based industries Others
34.0% 23.0% 23 0% 17.6% 10.3% 6.3% 2.5% 6.3%

Significant share in key industry sectors & p g f y y products
Soda ash production Salt processing Diamond processing Plastic industry Petrochemicals Chemicals Groundnut Cotton Fabrics Pharmaceuticals 65.0% 65 0% 58.0% 50.0% 42.3% 35.0% 30.0% 28.0% 85.0% 80.0% 98.0%

World’s largest producer of castor and cumin World’s largest gas based single location sponge iron plant World’s largest producer of processed diamonds World’s 3rd largest producer of denim Asia’s largest grass root petroleum refinery at Jamnagar India’s largest producer of cotton India’s first LNG chemical port terminal at Hazira

Source: Socio Economic Review 2007-08 2007 08


Gujarat: Robust Infrastructure

Dependable power supply – key to industrial development
Present power generation capacity is 9,628 MW; plans afoot to raise it to 25,000 MW by 2012 Per capita power consumption is 1,354 units against the national average of 665 units p p p , g g Rich availability of natural gas (34 MMCD) and lignite (1,072 MMT) 24-hour 3-phase uninterrupted power supply

Gujarat is the only State to carry out interlinking of rivers
An extensive water grid network of 75 000 km for irrigation and drinking 75,000 It will cover 75% population of the state by 2010



Transformation of economy through natural gas
Gujarat State Petronet Limited (GSPL) supplies piped gas to 13 districts 5 more districts will be added districts, Total length of Integrated Gas Grid will be 2,200 km, of which 1,453 km is complete and the rest is under construction

Gujarat: Robust Infrastructure
Rail and Road

Surfaced road length – one of the highest in India
State-of-the-art road infrastructure: India’s first National Expressway from Ahmedabad to Baroda Total road length is 74, 018 km - 95% surfaced road Total rail length - 5188 km (8.25% of India)

Gujarat Ports opening the gateway to prosperity j g g y y
42 ports along 1,600 km coastline, including 1 major port at Kandla and 41 minor ports Landmark projects such as LNG port terminal at Hazira developed by Shell India Limited, green field port at Mundra developed by Gujarat Adani Port Limited, LNG terminal at Dahej developed by Petronet LNG Ltd. and Pipapav port developed by Gujarat Pipapav Port Ltd


Airport connectivity – a cutting edge for business
13 airports - Vadodara, Surat, Jamnagar, Rajkot, Bhavnagar, Porbandar, Bhuj, Pipavav, Mandvi, Mundra, Kandla, Palanpur and Ahmedabad (International Airport)

Global Industry Overview – IT/ITES
Technology-related Technology related spending
Market size is estimated at over US$1.5 trillion % Software and IT-BPO services account for over 70% of the total market size Spend on engineering and R&D (excluded above) estimated at US$780 billion
2005 2006

Global technology spending

IT Services BPO Packaged Softw are Hardw are R&D and Engineering 0 100 200 300 400 228 211

470 444 423 385

US$ 1.5 trillion

457 424 783 764 500 600 700 800 900

World-wide IT services spending
IT services form the largest segment of the world-wide spend on technology products and related services Spend on IT services was estimated at US$470 billion growth of 5.9% over US$444 billion in 2005 In IT services, outsourcing is the largest and fastest growing category In 2006, the spend on IT outsourcing was estimated at over US$ 170 billion, which was 36% more than in 2005
500,000 400,000 300,000 200,000 100,000 0

USD billion

World-wide IT services spending($million)



2008 Outsourcing



Project based

Support and training



IT/ITeS: Contribution to India
Contributing to approximately 5.4% of India’s GDP up from 4.8% last year Sector revenues for the FY 2007 is estimated to stand at US$ 47.8 billion, a growth rate of 28% over FY06 Exports accounted for US$24.2 billion share of revenue in FY06 and share of domestic market was US$13.2 billion in FY
FY03 FY04 FY05 FY06 FY07 E 6.3 13.3 9.8 8.3 10.2 18.3 18 3 15.9 13.2

IT/ITeS IT/IT S revenue growth (i US$ billion) th (in billi )


Domestic market Exports

The Banking, Financial Services and Insurance (BFSI) vertical registered the largest share of exports from India at 38.10% (FY06) 1.29 million people were employed in the software and software services segment in the FY06 and the figure is expected to have reached 1 6 million for FY07 1.6
19.80% 38.10%

FY06 Exports
2.10% 3.00% 4% 8.40% 8 40% 4.20% 4 20% 7.60% 12.90%

Airlines & Transportation Healthcare Construction & Utilities Media Retail Manufacturing Hi-tech/ telecom BFSI Other

MNC investments reach an unprecedented scale; over US$10 billion announced in FY 2006-07

Source: NASSCOM Department of Information Technology GoI NASSCOM, Technology,


Advantage Gujarat

Industry friendly IT Policy
Business friendly environment Advanced infrastructure and superior connectivity

Flexible labour laws
Low real estate cost

One of the lowest start up and operational costs in India Low cost of living

Advantage Gujarat 10 IT/ITeS SEZs and growing Low manpower costs

Premier R&D centres and quality educational infrastructure 24/7 uninterrupted power supply i t t d l

Uninterrupted power supply

Huge talent pool and low attrition rate

State-of-the-art infrastructure Connected with the world


Gujarat :The IT Story
One of the most e-prepared state in the country; frontline state in the implementation of e-governance policies and projects One f the highest tele-density i th country and l O of th hi h t t l d it in the t d longest OFC t network (over 65,000 kms) Government supported comprehensive IT infrastructure
Gandhi Nagar

development through joint ventures with private players Ready to use state-of-the-art infrastructure such as the Creative Infocity Park t Gandhinagar and GNFC I f t I f it P k at G dhi d Infotower and A t d Astron IT Park at Ahmedabad 15 IT/ ITeS/ Electronics Special Economic Zones to be set up in p p the State by large corporate players such as Tata, DLF, Adani Group, Raheja group, L&T,GIDC etc. Gujarat International Finance Tech-City (GIFT), a 500 acre mega project for global financial services industry to come up at Gandhinagar
Emerging IT/ITeS destinations Rajkot Bhavnagar Surat Ahmedabad Vadodara


Gujarat: The IT Growth Trajectory
State St t expenditure on IT (in US$ million) dit (i illi ) The Information and Communication Technology (ICT) sector in Gujarat is projected to see
35 30.49 30 5 25 23.71 17.57

+ 6.78

investments up to US$3.7 billion by 2011 The IT/ITeS sector turnover should grow from US$ 60 million in 2005 to US$2.4 billion in 2010-11 Software exports from the State saw a growth rate of 107 3% to reach US$134 million in FY 2006 07 107.3% 2006-07 as compared to that of FY 2005-06 Information technology-enabled services (ITeS) and IT hardware industry are the focus growth areas of Gujarat’s IT industry

20 15 10 5 0 FY 05 9.7

FY 06

FY 07

FY 08

Software exports (in US$ million)

+ 69.36
64.64 48.86 35

FY 2003-04

FY 2004-05

FY 2005-06

FY 2006-07

Source: DST, Government of Gujarat


Gujarat: Focus Growth Areas

IT services i

Information technology

Information Technology enabled Services Semiconductor / IT hardware

Semiconductor/ IT hardware

IT ecosystem


Potential Locations for IT/ ITeS Investments
Gandhinagar – Ahmedabad Knowledge Corridor (12 IT/ITeS SEZs + STPI) Gujarat International Finance Tec-City ( y (GIFT) )

Gandhi Nagar

GNFC Infotower and Astron IT Park (Ahmedabad)



Fast emerging as the favourite destination for IT/ITeS companies (3 SEZ + STPI (planned))

Bhavnagar Surat

STPI centre (upcoming) STPI centre (planned)

10 multi-product/ multi-services SEZs


Special Incentive Package for Semiconductor Industry
Semiconductor Policy of the Government of India A special incentive package for setting up semiconductor fabrication and other micro and nanotechnology manufacturing i d i d h l f i industries i
Type of unit Threshold Investment NPV
(in USD mn)

Incentive in SEZ

Incentive in Non SEZ

Fab unit Eco- system unit

609.8 244

20% of capex 20% of capex

25% of capex + CVD* 25% of capex + CVD*

State Government can offer i St t G t ff incentives over and above thi amount ti d b this t Units may claim incentives in the form of capital subsidy (investment grant/ interest subsidy) or equity participation (26%)

*Countervailing duty


Software Technology Parks of India (STPI)
It is a society set up by the Department of Communication and Information Technology, Government of India with the objective of encouraging, promoting and boosting the software exports from India A single-point contact centre providing consulting, training and implementation services to its member units The software technology park in Gandhinagar is one of the first five STPI centres of India There are 350 registered units and 172 operational units i the P k i l i in h Park 91 units have been issued in-principle

Gandhinagar Rajkot Ahmedabad Jamnagar Bhavnagar Surat

Services offered by STPIs y
• • • Statutory services Data communications services Other infrastructure services Oth i f t t i Manpower training support Incubation support Software Technology Park Software Technology Park (upcoming) Software Technology Park (planned)

(provisional de-bond) approvals A new STPI is coming up in Surat and approval has already been received from Government of India (GoI) There are also plans to set up a STPI each in the districts of Rajkot, Bhavnagar and Jamnagar

• •


Gujarat: IT Policy Incentives
Special incentives for mega-IT projects creating employment of more than 1000 persons in case of IT unit and 1500 persons in case of an ITeS unit Special incentives for projects with investment of US$ 12.2 mn and above Financial assistance @ 50% of fixed capital investment i Fi i l i t f fi d it l i t t in land, buildings and infrastructure facilities to IT park developer upto a maximum of US$ 0.61 mn Stamp duty exemption on purchase of land for IT park developers State shall facilitate a grant of SEZ status to IT industry/ IT parks subject to the provision of SEZ Act/ rules Additional floor space index (FSI) allowed for IT/ITES parks in urban centres Nomination of one escort officer for each IT mega project including IT Parks

Promotion of urban-based IT infrastructure


Gujarat: IT Policy Incentives
Exemption of IT/ITeS units from zoning regulations Continuous government support for enhancement and development of quality manpower f the IT/ ITeS industry d l t f lit for th IT S i d t Stamp duty exemption @ 50% for IT/ ITeS units in IT Parks All new IT units exempted from the payment of electricity duty for a period of five years and exemption from power cuts

Promotion of IT/ ITeS/ IT hardware units in the State

Waiver of ‘no objection certificate’ from Gujarat Pollution Control Board Board” for IT/ ITes units engaged in provision and production of “IT IT services and IT software Simplification of labour laws Permission to h P i i have 24/ operations + women to work at night 24/7 i k i h Self certification-cum-consolidated annual returns scheme Strengthening of cyber crime detection cell for security purposes Gujarat IT Venture Fund, set up to provide venture capital for development of IT, ITeS and IT products industry


SEZ Policy
SEZ scheme has been introduced to provide hassle free environment and state of the art infrastructure hassle-free state-of-the-art Gujarat has liberal labour policy providing complete flexibility in SEZs SEZ Development committee monitors infrastructure development for each SEZ

For SEZ units – benefits
Income tax incentives

Indirect tax incentives ► Nil customs duty ► Nil excise duty ► Exemption from central sales tax ► Exemption from service tax ► Exemption from securities transaction tax ► Exemption from tax on sale of electricity for self generated and purchased power

10 year corporate tax holiday on export profit – 100% for initial five years and 50% for the next five years

Other benefits
► ►

Exemption of electricity duty – 10 Years* p y y Duty-free procurement of capital goods (including second hand capital goods), raw materials & consumable spares from domestic market Full freedom for sub-contracting Facility to realise and repatriate export proceeds within 12 months Facility to F ilit t retain 100% f i t i foreign exchange receipts i th export h i t in the t earner’s foreign currency account

► ► ►

Source: Industries Commissionerate / iNDEXTb, Government of Gujarat, 2007 , * Section 15 – Sub Section II of GoG SEZ Act 04


SEZ Policy
For developers of SEZs – benefits
Income tax incentives ► 100% t h lid f a period of any 10 consecutive years out of 15 tax holiday for i d f ti t f years beginning from the year in which the SEZ is notified ► Exempt from dividend distribution tax ► Tax exemption on interest of long term finance ► Long-term capital gains arising on transfer of shares in developer company tax exempt ► No minimum alternate tax (MAT) Other Benefits p p pp ► Full freedom in allocation of developed plots to approved SEZ units on purely commercial basis ► Full authority to provide services like water, electricity, security, restaurants and recreation centres on commercial lines ► No net foreign exchange earning requirement imposed
Source: Industries Commissionerate / iNDEXTb, Government of Gujarat, 2007 , * Section 15 – Sub Section II of GoG SEZ Act 04

Indirect tax incentives ► Nil customs duty ► Nil excise duty ► Exemption sales tax p ► Exemption from service tax ► Exemption from securities transaction tax ► Exemption from tax on sale of electricity for self g generated and purchased p power from central


Gujarat: IT/ ITeS special economic zones
“539.55 hectares of ready-to-use dedicated SEZ space for your investments”
DLF SEZ Raheja IT SEZ Tata SEZ GIDC IT/ITeS SEZ Shivganga Real Estate Million Minds SEZ 3rd EYE Voice SEZ AdaniSEZ City Gold Realtors Nipiam Infotech SEZ Gandhinagar Electronic SEZ SGV Infrastructure – SEZ L&T Ltd. – SEZ Strength Real Estate Gaurinandan Property

Location (district)
Gandhinagar Gandhinagar Gandhinagar g Gandhinagar Gandhinagar Ahmedabad Ahmedabad Ahmedabad Ahmedabad Vadodara Gandhinagar Ahmedabad Vadodara Vadodara Ahmedabad

Area (hec)
10 28 10.31 22.7 52 54 16 20 10 220 28 24 14.8 13.74 16 IT/ ITeS special economic zones (SEZs) Electronic special economic zone (SEZ) Surat Rajkot Ahmedabad Vadodara Gandhinagar


Multi-Product SEZs For IT Hardware
“10 multi-product/ multi-services SEZs supported by 1600 km of coastline”
Kandla SEZ SUR SEZ MP SEZ Dahez SEZ Reliance SEZ Sterling SEZ GIFT SEZ Mundra SEZ Essar Jamnagar SEZ Indian Infrastructure Corpn. Ltd. SEZ

Location (district)
Kutch Surat Kutch Bharuch Jamnagar Bharuch Gandhinagar Kutch Jamnagar Vadodara

Area (hec)
400 50 2658 1718 Ahmedabad 1764 1263 101.17 1081 1125 1011.71 Special Economic Zones (SEZs) Jamnagar Bharuch Surat Vadodara Kutch Gandhinagar


Gujarat International Finance Tec-City (GIFT)
A one-stop destination for global financial services industry spread over 500 hectares Located at a distance of 12 km from Ahmedabad International Airport and 8 km from Gandhinagar, alongside National g , g Highway No. 8 GIFT ICT advantage
• • • • • • High speed IP-based network i h d b d k Infinite bandwidth Robust data centre with disaster recovery sites Intelligent building services Shared market infrastructure (Access to National and Global Stock Exchanges) Secure, reliable, scalable platform for global financial communities Gandhinagar Ahmedabad

Land Multi-services SEZ M lti i Domestic tariff area Built space FSI/FAR Green belt Building height 500 acre 250 acre 250 acre 7.5mn sq.m 3.65 0.59 mn sq.m 400m

Source: Gujarat Urban Development Corporation (GUDC)

Gujarat International Finance Tec-City (GIFT)


Gujarat International Finance Tec-City (GIFT)
Central business hub of an Integrated Development Plan area sprawling over about 27,000 acres

State-of-the-art St t f th t Infrastructure walk to work walk-to-work services services housing,

connectivity, ti it to support and

infrastructure and transportation access businesses including connectivity, IT, security

Global Gl b l BPO hub for financial services h b f fi i l i Preferred off-shoring location for global financial services players Operations hub for domestic financial services Centralized hub for mid and back office related activities for domestic financial services company Global IT hub for financial services Development and system support center for IT players with significant presence in financial services sector Global R&D hub for emerging sectors Preferred R&D hub for industry Financial center for select product markets Fi i l t f l t d t k t Integrated financial center dealing with the full set of financial services product including capital markets and trading

Mass Rapid Transit system linking the p y g Project site to the cities of Ahmedabad and Gandhinagar


Assured Technical and Skilled Manpower
Technical Institutes
120 100 80 59 60 40 20 0 MCA &ME MBA & Allied Degree Engg. Diploma Engg. 2008-09 18 49 24 25 53 34
10000 5000 771 0 MCA &ME MBA & Allied Degree Engg. Engg Diploma Engg. Engg 3473 5010 1655 7557

Seats available


25000 20000 15000 9115 17356




53 degree engineering colleges offering over 17,000 seats 106 diploma engineering colleges offering over 25,023 seats


Bridging the Manpower Gap
441 vocational training institutes (Industrial Training Institutes (ITI’s) offering 87,981 seats every year

500 400 300 200 100 0 2003-04 2004-05 2005-06 2006-07 Total seats
71,864 71 864 73,003 73 003 71,633 71 633 72,775 72 775 337

87,981 441

100000 80000 60000 40000 20000 0







Assured Quality Manpower…
India’s leading institutes
Indian Institute of Management (IIM)
National Institute of Fashion Technology (NIFT)

National Institute of Design (NID) g ( )
Institute of Rural Management (IRMA)

Indian Institute of Technology (IIT)
Mudra Institute of Communications, Ahmedabad (MICA)

Centre for Environment Planning & Technology (CEPT)
Gujarat National Law University (GNLU)

Dhirubhai Ambani Institute of Information & Communication Technology
Indian Institute of Information Technology-Academy (IIIT-A) - proposed


e-Governance : The Way Forward
Gujarat Informatics Ltd (GIL) Ltd.
Government of Gujarat in Feb 1999, established GIL as a nodal agency to promote IT and accelerate the process of e-governance in the State. GIL is also responsible for the implementation of IT projects in the State.

Most e-p prepared state in the count d t try

Bhaskaracharya Institute for Space Applications and Geoinformatics (BISAG)
State-level nodal agency to facilitate use of spatial and geo-spatial technologies for planning and developmental activities pertaining to agriculture, land and water resource management, wasteland/watershed development, forestry, disaster management, infrastructure and education, etc

State Data Centre
• • • Web hosting for all Government departments Government e-mail server facility Support helpdesk

Sachivalaya integrated communication network (SICN)
• • • The electronic telephone system enables excellent connectivity between various Government offices Connects 7 000 voice/data connections while also saving costs on telephone bills 7,000 connections, 1,25,000 internal and 70,000 external calls each day

Gujarat state-wide area network (GSWAN)
• Connects over 12,000 nodes of more than 3,000 offices in 26 districts and 225 Talukas, for video conferencing g and data exchange with the state headquarters in a closed user group (Largest IP based network in the AsiaPacific region) Growth: 64 Kbps (2002)-2Mbps (2005)-4 Mbps(2006)->8 Mbps
*not exhaustive list


e-Governance: The Way Forward
VAT (Value added tax):
The project was initiated to ensure efficient, effective, economical and transparent tax administration by promptly capturing of data at its origination in digitised form so that the VAT administration could be more informed and controlled.

Most e-p prepared state in the count d t try

Ahmedabad Municipal Corporation is the first Municipal Corporation in India to facilitate better delivery of municipal services like birth and death registration, building plan, primary health and education, city cleanliness, water supply, sewage, road, street-lights, parks and garden through e-governance.

SWAGAT (State-Wide Attention on public Grievance by Application of Technology):
A unique online public grievance redressal system introduced by the State Government to put the common man directly in touch with the highest office in administration – recognised by Manchester University as a model case of e-transparency.

Integrated workflow and document management system (IWDMS)
• • • Standard solution to streamline document management by leveraging the LAN & GSWAN network, An umbrella solution - applications f all G for Government department f functions, Connecting 2,300 users in the secretariat.
*not exhaustive list


Gujarat: Accelerating Growth
NAC (NASSCOM Assessment of Competence) Test

Most e-p prepared state in the count t try

An initiative by the State Government in collaboration with NASSCOM to ‘benchmark skill-sets of the workforce workforce’ from tier 2 and tier 3 cities for the ITeS/ BPO industry.

College-to-career programme (CCP)
State Government in collaboration with Microsoft and TCS provides high quality software skill upgradation for students of Engineering/ MCA colleges. The programme includes lectures by experts from TCS and Microsoft, interactive sessions, online tests and certification by TCS and Microsoft.

Gujarat Knowledge Society
Gujarat Knowledge Society (GKS) is a society formed by the Government of Gujarat to prepare the youth for new age knowledge based economy and society so as to stimulate creation of world class knowledge resources by developing new competencies in skills.

In order to improve the spoken English ability of the youth in the State, Government of Gujarat has set up a ‘Societ for Creation of Opport nities thro gh Proficienc in English’ (SCOPE) in collaboration with p ‘Society Opportunities through Proficiency ith Cambridge ESOP.
*not exhaustive list


Gujarat: Accolades Received
Best e-Governed state – Gujarat Excellence in Government process re-engineering – VAT information system

Best e-Governance Project – VAT information system and e-procurement Outstanding performance in citizen-centric service delivery –
City Civic Centre, Surat Municipal Corporation
*not exhaustive list


Vibrant Gujarat : Global Investors’ Summit
The State Government has been playing a very active role in promoting Gujarat as a potential investment destination through the Vibrant Gujarat Global Investors’ Summit, organised every two years since the year 2003 To promote the IT/ ITeS sector in Gujarat, the State Government organised Vibrant Gujarat: IT Summit 2006 with a special focus on inviting sectorspecific investments The event attracted more than 400 delegates from across the globe 21 MoUs were signed attracting investments more than INR14 000 crore INR14,000 (approximately US $ 4 bn) These investments are expected to create more than 300,000 job opportunities in Gujarat


Invest in Gujarat : A world- class Business Destination
To Delhi

Bio-Tech cluster
Patan Mehsana Kutch Himmatnagar

Soda ash and saltbased industries, cement and steel pipes t d t l i 202 industrial estates across Gujarat Petroleum and brass parts Engineering and ceramics Soda ash and salt based 18 Captive Ports along 1600 km coastline across Gujarat

Ahmedabad Surendranagar Anand Jamnagar Rajkot R jk t Porbandar Bhavnagar Amreli Junagadh Surat Vadodara Bharuch Narmada Kheda Panchmahal Dahod

Gujarat International Finance-Tec City Knowledge corridor Industrial corridor (DMIC) Savli Biotech Park Petroleum, Chemicals and Petrochemicals Investment Region (PCPIR) Chemicals, petrochem. pharma, textiles and engineering 55 special economic i l i zones (SEZs) across Gujarat


Special Investment Region (SIR)


Logistics park 55 special economic zones (SEZs) across Gujarat 202 industrial estates across Gujarat

To Bombay


Key Contacts

Industries Commissionerate, Government of Gujarat

Industrial Extension Bureau (iNDEXTb) Department of Science and Technology (DST) Gujarat Informatics Ltd. ( j (GIL) ) http://www.


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