An Overview of Industrial Development in Rajasthan

Easy access to largest consumer markets, Rajasthan touches six major states of the
Northern, Western and Central India. It is a natural corridor between the wealthy Northern
and the prosperous Western states of the country, which makes and important trade and
commerce centre. In terms of employment, the business and economy of Rajasthan is
predominantly pastoral and agricultural. Business and economy of Rajasthan include
agriculture, industries, mining and tourism as well.

Since 1950, Rajasthan has been the lucrative hub of industrialization. Illustrious Business
Communities like the Singhanias, the Birlas and the Shrirams established large scale
business enterprises in the state of Rajasthan. Thus Singhania's JK Synthetics and Shriram's
Company- Shriram Rayons came up in the year 1962 and 1965 respectively. National
Engineering Industries and the Chambal Fertilizers which belong to the Birla group of
Companies was set up in 1950. At present almost all prominent Business masters like the
Modis, Bangurs, Poddars Thapars, Goenkas, and Rankas have established their industrial
units in the gigantic state of Rajasthan. Over the years 212 industrial regions have
developed embracing about 42,000 acres of land. Industrial Parks with the added advantage
of modern infrastructure system like telecommunications, electricity, water, etc have also
come up.

The Major Industrial estates of Rajasthan are Shahajahanpur, Khushkhera, Neemrana,

Behror, Jurhera in Bharatpur. The Bhiwadi Industrial Development Authority, the industrial
township was set up by RIICO recently in Rajasthan. Other industrial sites include Udaipur,
Abu Road, Banswara in South Rajasthan. All these areas are related to mineral based
projects. The industrial regions of Malviya Nagar, Sitapura and Vishwakarma in Jaipur
boast of superior social infrastructure and Sitapura houses the Export Promotion Industrial
Park. Steel and Textile Industries are located in the Jodhpur and Bhilwara regions
respectively. The state capital Jaipur has 19 industrial estates and Kota has 14 industrial
estates. These areas have rich deposits of sandstone and limestone.

RIICO along with the State Government has developed several Growth Centers as Sirohi,
Jhalawar, Sikar (Palsana), Bikaner (Kahara and Karnal), Dholpur, Naguar and Bhilwara.
The main Industrial areas developed are: Bhiwandi, Industrial Area, Neemrana,
Khushkhera, Chopanki, Sarekhurd, Sotanala, Shahjahanpur, Behror. Rajasthan offers 277
industrial areas that provide a ready to use base with supportive infrastructure facilities. The
Rajasthan State Industrial Development and Investment Corporation Limited (RIICO) has
played a major role in giving an impetus to industrialization in the state as well as
developing industrial infrastructure.

The impressive scorecard of developing about 300 industrial areas, financial

assistance to about 900 projects, development of 35,000 acres land for industrial
purpose, sanction of over Rs. 15,000 million to industrial, commercial, educational and
infrastructure projects, catalyzed investment of around Rs. 50,000 million in
Rajasthan through term lending and employment opportunities for about 90,000
persons, speaks of achievements made.

2.1 Economy of Rajasthan

Situational Analysis Table-1

Strengths Limitations
Abundance of land and natural resources Arid and semi-arid climate
Huge manpower base Mismatch between existing and required
Widespread mineral/oil/gas base skills
Huge livestock base Availability of water
Rich heritage and natural beauty Lack of world class training/education
Better law and order situation infrastructure

World-wide recognition in niche products Huge fiscal deficit and financial liabilities

Opportunities
Global hub for niche products, like gems
and jewellery, textiles
Energy-base for the region
Supply-base of highly-skilled service
professionals, including for manpower
export
Global supplier of medicinal plants, herbs,
spices and dairy products
Global destination for heritage tourism
Challenges
Fiscal management
Water conservation, watershed
development, and mapping production
activities with water requirement and
availability
Skill development and mapping existing
skill base with production activities
Improvement in health and education, so
as to achieve better productivity
Development of infrastructure for
economic activities
According to Finance Department of Rajasthan Government ‘s published Statement on Six
Monthly Review 2010-11 (period ended on 30th September,2010) The state’s gross
domestic product (GDP) grew at an impressive compound annual growth rate (CAGR) of
14.1 % between 2002-03 and 2008-09 to reach US$ 41.74 billion. Rajasthan’s economy is
primarily agricultural and pastoral representing one-third of Rajasthan’s GDP.

Rajasthan's Gross Domestic Product (GDP) may have shown a dismal growth of 2.5% last
fiscal, but a turnaround is expected 2010, following promises of a healthy growth rate in
most sectors of the state. The surprise in the pack is the primary sector, which has outpaced
all other sectors .The macro-economic trends for the first six months of the financial year
2010 shows that agriculture production is likely to double this year, following a bountiful
rain. However, in real terms, the state's GDP has proved to be laggard. It was Rs. 1,48,200
Crore last year at the constant prices (1999-2000), this financial it grew at just 2.51% this
year to Rs. 1,44,568 Crore. Riding on the generosity of rain gods, the food grain production
in the kharif season is likely to be 71.34 Lac metric ton (MT) while it was only 37.62 Lac
MT in 2009-10, an increase of 90%. This is despite the fact that total sowing area was less
than last year's. This year, the total sowing area was 94.62 Lac hectares in comparison to
96.07 Lac hectares last year. Similarly, the oil seeds production, too, increased by more than
50% to 21.82 Lac MT, while it was only 14.52 Lac MT last year.

In contrast, investment in the industrial sector was up by 15.48% to Rs. 883 Crore against
Rs.764 Crore for the corresponding period last year. However, a better way to judge the
industrial growth will be the registration of new small-scale industries and employment
generation. More than 6,000 units opened up this year, generation additional employment of
43,044 persons compared to 5,682 such units and employment of 36,272 persons. The
mining sector also registered a remarkable growth, generating Rs.727.87 Crore worth
revenue in the first six months, while last year for the same period the revenue collection
was Rs. 532.81 Crore, which is an increase of 35.67%. The State governments have
formulated their budgets for 2009-10 against the background of the knock on effect of
global financial crisis on the Indian economy. To address the overall macroeconomic
slowdown, the Central Government allowed the States to raise additional market
borrowings to the extent of 0.5 % of GSDP during 2008-09 and increase the limit of fiscal
deficit to 3.5 % of GSDP for undertaking capital expenditure, thereby providing them
additional fiscal space. Further in the Union Budget 2009-10, States have been allowed to
raise additional market borrowings of 0.5 % of GSDP, thus increasing the limit of GFD to
4.0 % of GSDP during 2009-10.
 Table-2: Estimates of Gross / Net State Domestic Product (GSDP/NSDP)

and Per Capita Income (PCI) of Rajasthan

Ye a r C u rre n t P ric e s C o n s t a n t ( 19 9 9 - 2 0 0 0 ) P ric e s

G S D P ( La kh R s . ) V a rit i o n ( P e rc e nt ) G S D P ( La kh R s . ) V a ri t io n ( P e rc e nt )
1999-2000 8 2 7 19 7 1 8 2 7 19 7 1
2000-01 8243491 -0.34 8 10 5 9 5 9 -2.01
2001-02 9 17 7 0 8 8 11.33 8986879 10.87
2002-03 8855005 -3.51 8097363 -9.9
2003-04 1116 0 6 4 5 2 6 .0 4 10 4 18 8 9 1 28.67
2004-05 117 2 7 4 3 1 5.08 10 2 2 5 8 16 -1.85
2005-06 12 8 6 4 4 0 4 9.69 110 2 9 3 4 1 7 .8 6
2006-07 15 3 3 4 3 5 1 19.2 12 4 3 3 9 2 0 12.73
2007-08 P 17 6 4 2 0 2 1 15.05 13 5 6 5 3 6 4 9.1
2008-09 Q 2 0 16 7 5 3 0 14.32 14 4 5 6 8 3 8 6.57
2009-10 A 2 19 7 6 8 8 0 8.97 14 8 2 0 0 3 7 2.51
Ye a r C u rre n t P ric e s C o n s t a n t ( 19 9 9 - 2 0 0 0 ) P ric e s
N S D P ( La kh R s . ) V a rit io n ( P e rc e nt ) N S D P ( La kh R s . ) V a ri t io n ( P e rc e nt )
1999-2000 7 4 17 3 8 5 7 4 17 3 8 5
2000-01 7276624 -1.9 7 17 6 4 0 7 -3.25
2001-02 8087969 11.15 7993604 11.39
2002-03 7660457 -5.29 7 0 3 3 3 18 12.01
2003-04 9823599 28.24 9 2 7 12 19 31.82
2004-05 10 2 3 7 5 9 6 4.21 9044459 -2.45
2005-06 1113 2 2 8 5 8.74 9727672 7.55
2006-07 13 3 4 7 5 6 4 19.9 110 0 3 9 0 9 13.12
2007-08 P 15 3 6 9 7 3 5 15.15 12 0 2 6 7 2 6 9.3
2008-09 Q 17 6 0 4 4 4 3 14.54 12 8 4 9 5 8 5 6.84
2009-10 A 19 15 3 9 0 7 8.8 13 13 3 14 7 2.21
Ye a r C u rre n t P ric e s C o n s t a n t ( 19 9 9 - 2 0 0 0 ) P ric e s
P C I ( La kh R s . ) V a rit io n ( P e rc e nt ) P C I ( La kh R s . ) V a ri t io n ( P e rc e nt )
1999-2000 13 6 19 13 6 19
2000-01 13 0 2 0 -4.4 12 8 4 0 -5.72
2001-02 14 0 9 8 8.28 13 9 3 3 8.51
2002-03 13 12 8 -6.88 12 0 5 4 -13.49
2003-04 16 5 0 7 2 5 .7 3 15 5 7 9 29.24
2004-05 16 8 7 4 2.23 14 9 0 8 -4.31
2005-06 18 0 0 8 6.72 15 7 3 6 5 .5 6
2006-07 2 12 0 3 17.74 17 4 8 0 11.08
2007-08 P 23986 13.13 18 7 6 9 7.37
2008-09 Q 27001 12.57 19 7 0 8 5
2009-10 A 28885 6.98 19 8 0 6 0.5
P: Provisional, Q: Quick, A: Advance
2.1.1 Rajasthan’s GSDP

According to Indian Brand Equity Foundation (IBEF) Rajasthan, at current prices, the Gross
State Domestic Product (GSDP) of Rajasthan was about US$ 46.4 billion in 2009-2010.
The cumulative average annual GSDP growth rate, from 1999-2000 to 2009-2010 has been
around 10.1 percent.

Rajasthan GSDP(Figure-1)

Source-IBEF

2.1.2 Rajasthan’s NSDP

According to Indian Brand Equity Foundation (IBEF) Rajasthan, at current prices, the Net
State Domestic Product (NSDP) of Rajasthan was about US$ 40.4 billion in 2009-2010.

The cumulative average annual NSDP growth rate between 1999-2000 and 2009-2010 was
about 9.8 %.

Rajasthan NSDP(Figure-2)

Source -IBEF
2.1.3 Percentage distribution of GSDP

The tertiary sector has an increasing share in Rajasthan’ Economy. In 2009-2010, the tertiary
sector contributed 45.2% to the state’s GSDP at current prices, followed by secondary sector
(30.0%). The share of the secondary sector in GSDP was driven by manufacturing that registered a
growth of 9.7 % between 1999-2000 and 2009-2010. The share of the primary sector in GSDP was
24.7 % in 2009-2010 vis-à-vis 32.0 % in 1999-2000, agriculture contributing

Percentage distribution of GSDP(Figure-3)

CAGAR
42.2 45.2 11.0 %

25.8
30.0
11.9 %
32.0 24.7 7.5 %

1999-2000 2009-2010

Tertiary sector
Secondary sector
Primary sector

2.1.4 Rajasthan’s per capita GSDP

In 2009-2010, Rajasthan’s per capita GSDP at current prices was US$ 699.2. The per capita
GSDP at current prices increased at a CAGR of 7.9 % from 1999-00 to 2009-10

Rajasthan’s Per capita GSDP in US $(Figure-4)

2.2 Industries in Rajasthan.
Key industries in Rajasthan
The natural resources, policy incentives and infrastructure in
•Cement
the state are favourably suited for investments in sectors such
•Auto and auto-components
as cement, IT and ITeS, ceramics, tourism, automotive and
•IT and ITeS
agro-based industries.
•Ceramics
Bureau of Investment Promotion (BIP) and Rajasthan •Mining
Industrial Development and Investment Corporation (RIICO)
•Tourism
are responsible for promoting investments and developing
•Textile
industrial infrastructure in the state.
•Agro-based industry
The Government of Rajasthan is promoting development of •Gems and jewellery
several SEZs across the state for sectors such as gems and •Marble
jewellery, handicrafts, IT, electronics and textiles.

2.3 Rajasthan’s exports trends

Rajasthan’s exports increased at a CAGR of about 19.5 % between 2001-02 and 2008-2009.
The state’s major exports include textiles, handloom, handicrafts, gems and jewellery,
minerals and auto components. In order to boost exports from Rajasthan, the State
Government is laying emphasis on developing export promotion industrial parks (EPIP).
“ExpocityJaipur”, which serves as an international habitat and convention centre, has been
developed by JaipurTrade Expo Centre Private Limited. It is spread over an area of 26,400
sq m and houses multi-utility homes, state-of-the-art business centres,(Figure-5)

! " #
2.4 Industrial infrastructure at a Glance

Infrastructure Primary industry Details

Theme parks Multi-industry RIICO is developing theme parks with a special

set of infrastructure and facilities for establishing
industries in line with the designated theme. It has
established a satellite earth station in the Sitapura
IT park of Jaipur along with the Software
Technology Parks of India (STPI).

Export promotion Multi-product EPIPs have been set up at Sitapura (Jaipur),

industrial parks Neemrana (Alwar) and Boranada (Jodhpur). The
(EPIP) EPIP in Jaipur is among the largest export parks in
Northern India. The units operating here have
export orders accounting for, at least, 33 %
of their total turnover.

SEZs Multi-product The state is developing SEZs for industrial growth;

as of July 2010, formal approval had been given to
eight SEZs, in-principle approval had been given
to 11 SEZs and there were seven notified SEZs. A
multi-product SEZ is being developed by
Mahindra World City (Jaipur) Limited, a joint
venture of Mahindra Gesco Limited and RIICO
Limited. This public private partnership initiative
envisages an investment of about US$ 241.1
million
SEZ for IT IT A state-of-the-art special economic zone has been
developed by Mahindra and Mahindra with an
investment of US$ 244 million. It has attracted
many domestic investors such as Infosys and
Wipro as well as substantial investment from
foreign investors.
Inland Container Logistics For ease of movement of cargo, ICDs have been
Depot (ICD) set up at Jaipur, Jodhpur, Bhiwadi and Bhilwara.

Spices park Food processing A spices park is proposed to be set up at Ramganj

Mandi for processing, packaging and export of
spices (especially coriander) from Rajasthan. The
park will be set up in an area of 30 acres at a total
cost of around US$ 3 million
Footwear Design & A FDDI is proposed to be set up at Jodhpur at an
and Development Footwear estimated cost of around US$ 22 million. This
Institute (FDDI) Institute will provide specialised training in footwear
technology and design.
Skill development A skill development centre will be set up by the
centre Confederation of Indian Industry (CII) in
conjunction with the State Government to provide
skills training for the unemployed youth of
Rajasthan. The location will be decided by the
State Government in conjunction with CII. Alwar
ITES
and Jaipur are two of the locations being
considered.

Industrial An industrial infrastructure up-gradation centre will be

infrastructure up- set up, possibly along the Delhi-Mumbai Industrial
gradation centre Corridor (DMIC). A detailed project report and the
exact location is being finalised by the State
Government.

2.5 SEZs and industrial clusters (Figure-6)

Index

Cement grade limestone

Automotive

Tourism

IT & ITeS

Handicrafts ,gems &

jewellery

Chemicals
Employment in Rajasthan

Small scale industry forms the backbone of industri

industrial
al activity and employment generation
in Rajasthan. In fact, the small scale industry gen
generates more employment than its large and
medium counterparts Over 70 % of Rajasthan’s industrial output comes from four re
regions
dominated by small scale industries: Jaipur, Bhilwa
Bhilwara,
ra, Udaipur and Ganganagar account for
39%, 18%, 9% and 4% of the State’s industrial output,
output, respectively. The key districts
driving industrial growth
wth are Ajmer, Alwar, Barmer, Bharatpur, Bhilwara, Bikaner, Bundi,
Chittorgarh, Jaipur, Jodhpur, Kota and Udaipur.
Udaipur.(Figure-7)

2.6 Industry Scenario in Rajasthan

To revive industrial growth in Rajasthan, the State Government has created an institutional
mechanism for attracting investment; the Bureau of Investment Promotion (BIP), Rajasthan
State Industrial Development and Investment Corpora
Corporation
tion (RIICO), Rajasthan Financial
Corporation (RFC), and Project Development Corporation
Corporation are fully operational. The State
Government has also put in place investor friendly sector specific policies, like the
Healthcare Policy, the Hotel Policy, the Power Policy,
Poli the IT Policy, thee Tourism Policy,
and the Biotech Scheme.

Also, a three-tier
tier Single Window Clearance mechanism exists to ex
expedite
pedite implementation
of industrial projects: the Board of Infrastructure Development and Investment (BIDI) under
the Chairmanship of the Chief Minister
Minister of Rajasthan, followed by the State Level
Empowered Committee (SLEC) under the Chairmanship ooff the Chief Secretary, followed
by the District Level Empowered Committee under the Chairmanship of the Deputy
Commissioner.
The Resurgent Rajasthan initiativ
initiativee has additionally brought significant investments into
Rajasthan, and going forward, is expected to drive the secondary and tertiary sectors as
well. A sector-wise break-up
up of the investment proposed to be made through the Resurgent
Rajasthan initiative is presented below (Figure-8)

Investments through Resurgent Rajasthan (Rs. Crore)

Cement 50618
SEZ 31310
Infrastructure 29619
Oil & Gas 10000
Power 9824
Engineering 7081
Tourism 5312
Healthcare 4610
Textile 3164
Education 3118
IT 2346
Food processing 2183
Gems & Jewellery 1400
Handicraft etc. 1033
Others 989

Thus while Rajasthan has factor advantages in a number

number of sectors backed by favorable
policies and support, the Stat
Statee faces challenges from various dimensions such as
unemployment rate, difficult working conditions, eearly
arly stage of industrial culture, need for
entrepreneurship and skewed economic development.

2.6.1 Identification of Growth Engines

With the above understanding

tanding of the State and the industrial scenario th
therein, the key
imperatives for identification of sectors for this study were:

1. Sectors (both formal and informal sectors) driving the Rajasthan economy
2. Sectors with high employment potential
3. Sectors with thee requirement of skilled human resources

The parameters focused on while studying the indust

industries
ries were market linkage, historical
presence of the industry in the State, supplier lin
linkage,
kage, infrastructure adequacy, availability
of trained manpower, availability and quality of training centre, time ttaken
aken to train, and the
employment opportunities. The industries identified on the basis of the above parameters
are: Auto & Engineering, Healthcare, Textiles, Repair
Repair servicing, Mines & Minerals, Oil &
Gas, Food processing, Tourism and Hospitality, Handloom and Handicraft, Construction,
and IT/ITES.
 Overview of Industrial Promotion of Rajasthan at A Glance (Chart 1 & Chart 2)

Parameter Rajasthan All-states Source

Economy

GSDP as a percentage of all 4.5 100.0 CMIE, as of 2007-08, current prices

states͉ GSDP
Average GSDP growth rate 11.5 11.8 CMIE, 2000-01 to 2007-08,
(%)* current
prices
Per capita GSDP (US$) 684.9 992.5 CMIE, as of 2007-08, current prices

Physical infrastructure

Installed power capacity 5,050.4 159,398.5 Central Electricity Authority, as of March

(MW) 2010
GSM cellular subscribers 25,487,398 456,586,162 Cellular Operators Association of India,
(No) as of June 2010
Broadband subscribers (No) 145,449 4,981,976 As of October 2008

National highway length 5,585 70,548 Ministry of Road Transport & Highways,
(km) Annual Report 2008-09
Airports (No) 6 133 Airport Authority of India

Social indicators

Literacy rate (%) 60.4 64.8 Census of India, 2001

Birth rate (per 1,000 27.5 22.8 Ministry of Health and Family
population) Welfare, RHS Bulletin, March 2008
Ease of doing
business
FDI inflows (US$ 0.5 120.2 Department of Industrial Policy and
billion) Promotion,
April 2000 to May 2010
Outstanding investments 53.6 1,972.6 CMIE, as of March
(US$ billion 2010
Industrial
infrastructure
PPP projects 54 515 www.pppindiadatabase.com
(No)
7 363
SEZ Notified as of July
(No) 2010,
www.sezindia.nic.i

Chart -1
 Parameter
Rajasthan Government

Policy support

Sectors with specific Healthcare, biotechnology, IT and ITeS, tourism, non-conventional

policies energy

Availability of labour Adequate skilled labour available

Chart -2

2.7 Overview of Industrial Policy of Rajasthan

Rajasthan has been in the forefront of Economic Reforms. It was the first State in the
country to adopt the International Competitive bidding route for setting up power projects.
It was also the first in the country to announce a State Road Policy, facilitating the entry of
private enterprise in the Roads sector. A new, simplified Sales Tax Act has been introduced
by the State Government. The Mineral, Marble and Granite policies of 1994 have promoted
scientific exploration and exploitation of the State's rich minerals. The Industrial Policy
1994 has brought about a significant change in its investment climate. The Rural Non Farm
Policy of 1995 - the first of its kind in the country - has helped focus efforts on growth and
employment through rural industrialisation.

With a series of policy initiatives taken in the last few years, most roadblocks to the private
sector's entry in Infrastructure have been removed. The State is poised for significant
developments in the Power Sector. The prospects for development of solar energy are
promising. There are indications of a significant oil and natural gas reserve, which could
change the face of Western Rajasthan's economy.

Rajasthan is now among the six fastest growing States of the country. Its Eighth Plan Outlay
constituted an increase of 283% over that of the Seventh Plan. During the past five years the
average growth rate of investment in the large and medium sector has been 33% and in the
SSI sector over 15%. Over the same period, exports from the State have grown at an annual
average rate of 53%.

The experience of implementing the State's 1994 Industrial Policy has also brought to light
certain deficiencies and practical problems, which need to be redressed. There are areas like
Infrastructure and Human Resource Development which require even greater attention than
has been accorded in the past. The New Industrial Policy of the State is thus an exercise to
reflect these developments and to launch new initiatives to take advantage of the emerging
opportunities.

2.7.1 Objectives

The principal objective of the new Policy is to make Rajasthan the most preferred State for
investment in the identified sectors and to ultimately achieve global competitiveness. While
governed by this basic goal, the Policy will lay special emphasis on accelerating the overall
pace of Industrial growth, increasing employment opportunities, improving productivity,
ensuring sustainable development and strengthening the SSI, Tiny and Cottage Industry
sector.

2.7.2 Strategy

1. The above objectives will be achieved by adopting a strategy which enables focused
growth. Thus, the new strategy envisages development of clusters offering economies of
agglomeration and thrust sectors.
2. The task of improving infrastructure would be given the highest priority. The plans for
infrastructure development will take into account the resource endowment and the
growth potential of each area.
3. Special emphasis will be given to the development of Thrust sectors, which have been
identified keeping in view their infrastructural requirements, growth potential and the
capacity to generate employment.
4. Simplification of rules and procedures, timely and smooth delivery of services will
receive continued attention. Special efforts will be made for developing Government -
Industry partnership in the implementation of the Policy.
5. Greater emphasis will be laid on development of human resources for emerging
requirements of industry.
6. The basic approach of all the initiatives will be to encourage increasingly greater
participation of private enterprise in the State's economic growth.

2.7.3 Infrastucture

The overall approach towards the development and up-gradation of infrastructure will be a
combination of optimum utilization of the State's resources and involvement of the private
sector. Specific measures will be taken to develop. Sectoral Clusters taking into account the
needs of the targeted industry.

2.7.4 Board of Infrastructure Development and Investment

The Board of Investment has been reconstituted as the Board of Infrastructure

Development and Investment to ensure greater focus on industry-related infrastructure. It
will ensure formulation of perspective plans for different regions, inter-sectoral co-
ordination and effective monitoring for timely provision of facilities in industrial areas.

2.7.5 Project Development Corporation

Based on the Memorandum of Understanding signed with Infrastructure Leasing and

Financial Services Limited (IL&FS) and Housing Development and Finance Corporation
(HDFC) a Project Development Corporation (PDCOR) has been set up in the private sector,
with equity participation by the State Government. The company will offer Investment
Banking Reports on commercially profitable projects tie up finances and offer projects for
implementation to prospective investors.

2.7.6 Establishment of Business Centres

In important industrial areas of the State, establishment of Business Centres in the private
sector will be encouraged. Rajasthan State Industrial Development and Investment
Corporation Ltd. (RIICO) will provide land and/or buildings for these Centres where
facilities like office and conference space, telephone, fax and photo copying facilities etc.
would be available to entrepreneurs.

2.7.7 Special Industrial Complexes

Special Industrial Complexes are being developed in the State by RIICO to meet the
requirements of specific industries, particularly of thrust sectors, at the following locations :

1. Gems & Jewellery EPIP & Gem Park, Jaipur

2. Hosiery Chopanki, Bhiwadi

3. Auto Ancillary Ghatal (Bhiwadi) & Sitapura (Jaipur),

4. Ceramics Khara, (Bikaner)

5. Software Technology EPIP, (Jaipur)

6. Electronics & Telecomm. Kukas, (Jaipur)

7. Textiles Bhilwara, Sanganer, Sitapura, Pali, Jodhpur, Balotra

8. Agro Industries IGNP Area

9. Leather Manpur - Macheri

10. Wool Industries Beawar, Bikaner

11. Handicrafts Shilpgram, (Jodhpur and Jaisalmer)

12. Dimensional Stone Kishangarh, Udaipur, Chittorgarh

2.7.8 Other Related Aspects

1. Efforts will be made to reduce project implementation time through provision of

essential infrastructure facilities like roads, power, street lights and water supply. An
industrial area will be declared as developed after these specific facilities have been
provided. Service charges will be recovered only with effect from the date of
declaration of the industrial area as developed. Missing links in the existing industrial
areas would be identified and steps taken to provide the required facilities.

2. Efforts would be made to provide social infrastructure facilities like housing, schools,
hospitals/dispensaries, shopping centres etc. in important industrial areas. Some of
the industrial areas would be developed as industrial townships.

3. The Industrial Complexes being developed in the National Capital Region of the
State would be further strengthened in terms of infrastructure facilities.

4. The entire belt around N.H.8 from Jaipur to Bhiwadi would be taken up for
integrated industrial development. A blue print for development of industrial
townships in this belt would be prepared keeping in view the increased flow of
investments in this region.
2.7.9 Development of Integrated Industrial Parks (IIPs) and Industrial Model Towns
( IMTs)

1. Development of Integrated Industrial Parks (IIPs) as joint venture projects with

RIICO, or in the private sector will be actively encouraged by undertaking the
following measures:

(a) Formulation of schemes for development of IIPs in the private sector on BOT
(Build-Operate-Transfer) or BOOM (Build-Own-Operate-Maintain) basis, while
dovetailing them with the overall development plans of the region.

(b) Encouraging promotion of IIPs through equity participation by RIICO and

assistance from other agencies of the Government.

(c) Devising a policy for allotment of land to private sector on the basis of a
transparent mechanism.

(d) Concessions available to industrial units set up in RIICO's industrial areas would
also be available to units located in the IIPs and Industrial Parks in the Private
Sector

2. Development of industrial areas in the private sector was earlier prohibited within 10
Kms radius of RIICO's industrial areas; this distance has now been reduced to 5 Kms.
Rajasthan Industrial Areas Allotment Rules, 1959 have been amended to facilitate the
development of industrial areas / estates in the private sector.

2.7.10 Land Conversion

Despite efforts made in the past, entrepreneurs have been facing difficulties in securing
conversion of land from agricultural to industrial. To resolve this problem, provision has
been made for automatic conversion of land upto 5 hectares. On expiry of 30 days from the
date of application for conversion to the appropriate Revenue authority the conversion shall
be deemed to have taken place and the concerned Revenue Authority/GM, DIC will issue a
certificate of deemed conversion. The concerned Tehsildar/Gram Panchayat shall make
necessary entries in the land records within 7 days.
2.7.11 Maintenance of Industrial Areas

1. Proper upkeep and maintenance of the existing industrial areas will be ensured by RIICO.
Wherever possible, Local Bodies, Industries Associations and other organisations will be
associated with this activity and on their request areas can be handed over to them for this
purpose.

2. Advisory Committees comprising, inter alia, industry representatives, will be set up in

respect of industrial areas to advice on:-

a) Maintenance and improvement of the existing areas; and

b) Redressal of grievances.

2.7.12 Settlement Committees

RIICO and RFC have constituted three tier Settlement Committees for resolving disputes
pertaining to entrepreneurs. These Committees are fully empowered to decide matters
falling within their jurisdiction. This would reduce future litigation and pending Court cases
can also be settled by these Committees.

2.7.13 Power

1. Rajasthan has been recognised as one of the two leading states, which have vigorously
pursued Power Sector Reforms. According to the assessment carried out by the Ministry
of Power during the year 1996-97, the difference between the Peak Demand and Peak
Demand met in Rajasthan was only 5.6% - the lowest among the twenty major States of
the country. In addition, in terms of Plant Load Factor the State with a PLF of 75.6%
was ranked the second in the country. Substantial private sector investment in power
generation is being encouraged.

2. Two units of 250 MW each are expected to be commissioned at Suratgarh Stage-I

Project during 1998 and 1999, respectively. In addition, the following major power
plants are scheduled to be commissioned in the IX Five Year Plan and early years of
X Five Year Plan:-.
 S.No Projects in Pipeline Capacity

1 Dholpur Power Project based on Liquid Fuel 700 MW

2 Barsingsar Power Project based on Lignite 500 MW

3 Suratgarh Stage-II Power Project based on Coal 500 MW

4 Kapurdi & Jalipa Projects based on Lignite 1200 MW

TOTAL 2900 MW

3. Captive power plants will be freely permitted. No permission from RSEB would be
required.

4. State Government has recently announced a Captive Power Plant Policy. The details of
the policy shall be issued by the Energy Department shortly.

5. As far as possible RSEB shall make arrangements to ensure uninterrupted supply of

power to continuous process industry, export oriented units and units set up in EPIP.

6. All industrial areas on rural feeders will be connected to urban/industrial feeders in a

phased manner for better quality of power and the cost to be incurred thereon shall be
borne by RSEB and RIICO equally.

7. As far as possible, land for power plants to be set up in private sector will be allotted by
RIICO close to the grid station of RSEB, at rates applicable for industrial land on
priority basis.

8. Provisional fuel surcharge will henceforth be revised on a quarterly basis to avoid an

undue burden on industrial units at a later stage.

9. Reduction in contract demand to units supplying surplus power to RSEB will be freely
permitted. Where the contract demand is reduced to zero, i.e., the industrial consumer
runs his plant entirely with his own power; no minimum charge shall be levied.

10. New large industrial consumers will be required to pay for the first six months on the
basis of actual consumption and for the next six months, on the basis of actual
consumption or 50% of the minimum charges, whichever is higher.
11. A system of deemed sanction has been started by RSEB for extension of power contract
demand. Similarly, a system of deemed sanction for reduction in load has also been
introduced.

2.7.14 Telecommunication

1. Special efforts will be made to provide efficient and reliable Telecommunication

Facilities in Industrial areas.

2. In case of new industrial areas, RIICO will take recourse to Bulk booking in advance so
that entrepreneurs are able to secure telephone connections without delay.

3. Cellular phones facility is already available in the following towns of the State :

1. Jaipur

2. Ajmer

3. Udaipur

4. Jodhpur

5. Kota . This facility is proposed to be introduced in other industrially important

locations like Alwar, Bhiwadi, Pali, Beawar etc.

In the emerging scenario, other than energy, communication will be a key factor for
economic development. This includes road, rail, telecommunications, postal services and
the state government will need to work in tandem with the centre and other states. Adopt a
futuristic approach and take innovative measures. For example, while laying roads, get the
telecom department as a partner to lay cables for providing high-speed Internet and other
communication services to villages. Similar approach can be taken with the railway
department. Concentrate more on oil- and gas-based energy production than coal-based
production. Also invest on wind and solar energy to the fullest extent

2.7.15 Railways

1. Under the unigauge scheme of the Railways, the State has taken a major leap
forward with the ongoing and proposed programs of conversion of metre guage lines
into broad guage. Most of the metre guage lines have already been converted and all
the major cities of the state except Udaipur and Bhilwara have been linked with
 broad guage. Jaipur has been linked to major industrial cities like Mumbai, Calcutta,
Chennai, Hyderabad, Delhi, Indore and many other towns.

2. Vigorous efforts will be made to ensure that Bhilwara and Udaipur are also
connected with broad gauge expeditiously.

3. The proposal to provide Rail link to Bhiwadi on priority will be pursued with the
Railways.

2.7.16 Road Network

1. The State Government has promulgated a Road Policy in 1995 to facilitate private
sector participation in construction of toll roads, bridges and by passes. Private
sector participation in Road sector is being actively encouraged. Under this policy
three works of roads/ bridges have already been awarded to private sector on B.O.T.
basis and several other works are being taken up.

2. The State's road network extends to 0.75 Lac kms. on 31st March 1997 comprising
National Highways, State Highways, District Roads and other roads of the existing
State Highway network, a length of 1500 kms. will be improved with World Bank
assistance during the 9th Five Year Plan.

3. The National Highway No.8, from Delhi to Bombay via Jaipur-Ajmer-Udaipur-

Ahmadabad is being converted into a four-lane highway. The stretch between Jaipur
and Kotputli has already been completed and the remaining portion between
Kotputli and Delhi is expected to be completed shortly. Jaipur-Ajmer section is
being taken up in the second phase.

4. In order to improve access to important industrial areas, the State Government and
RIICO will take up works for improvement of vital link roads to important industrial
areas like Bhiwadi, Khushkhera, Matsya (Alwar), Hirawala, Bindayaka, Kaladera
(Jaipur), Growth Centres at Dholpur, Brij (Bharatpur), Gudli (Udaipur) etc. The total
length of these road links will be about 100 kms.

2.7.17 Port Access

With a view to ensuring expeditious dispatch of export cargo, the State Government is
exploring the feasibility of securing a direct access to Marine Port in Gujarat. A feasibility
study for the purpose has been completed and a dialogue has been initiated with
Governments of neighboring states for joining hands to develop a berth facility at Kandla.

2.7.18 Air Transport

1. Important cities of the state like Jaipur, Udaipur and Jodhpur are well connected by
Air. Facilities at Jaipur airport have been upgraded and it has now started receiving
Chartered International flights.

2. Air Taxi Operators (ATO's), will be encouraged to expand their services in the state.
The use of State Government's existing air strips numbering 19 and some other
facilities has already been offered to ATOs so as to facilitate their operations.

Government of Rajasthan is creating an enabling environment for a balanced (between

different regions of the state) economic and social development of the state by involving
people through regular dialogues and feedback. Such dialogues should include presentation
on good (to take proactive measures) and bad (to learn lessons) practices vis-à-vis
development, collating examples from different regions of the world. Introduce necessary
administrative reforms at different level and such measures will have to be designed,
adopted, implemented and monitored through people’s participation.
Table-3: According to the Eleventh Five Year Plan (2007-12) & Annual Plan 2007-08

Planning Commission, Government of India has approved the Eleventh Five Year Plan of
Rajasthan of Rs. 71,731 Crore. Against this, Rs. 13794.69 Crore was spent during the
Annual Plan 2007-08. The major head wise approved outlay for the 11th Five Year Plan and
expenditure incurred during the Annual Plan 2007-08 are as under:

(Rs. in Crore)

Head of Development / Approved % to Actual % to

Sector Outlay total Expenditure total
(2007-12) 2007-08

1 2 3 4 5
1. Agriculture & Allied 2269.07 3.16 519.40 3.77
Services
2.Rural Development 4295.14 5.99 986.69 7.15

3. Special Area Program 1759.43 2.45 86.64 0.63

4. Irrigation and Flood 7302.06 10.18 877.07 6.36

Control
5. Power 25606.75 35.70 5692.38 41.26

6. Industry & Minerals 958.65 1.34 170.17 1.23

7. Transport 4683.06 6.53 678.22 4.92

8. Scientific Services 29.70 29.70 2.81 0.02

9. Social & Community 19719.83 27.49 693.87 5.03

Services
10. Economic Services 731.04 1.02 3929.03 28.48

11. General Services 4377.25 6.10 158.41 1.15

Total 71731.98 100.00 13794.69 100.00

State Government has already spent 19.23 % funds during the year 2007-08 of the approved
plan size for the 11th Five Year Plan. The researcher has taken only last two annual plan to
analysis the actual utilization of financial assistance.
Table-4: The Annual Plan for 2008-09

The Planning Commission has approved State's plan size of Rs.14020 c Crore, including Rs.
20 Crore as Additional Central Assistance for Goverdhan Drain (KNP), for the Annual Plan
2008-09. The major head wise approved outlay is as under:

(Rs. in Crore)

Head of Development / Approved Likely Of which

Sector Outlay Expenditure Budgetary Support

1 2 3 4
1. Agriculture & Allied 361.65 952.28 771.66
Services
2.Rural Development 1278.93 1130.83 1130.83

3. Special Area Program 89.24 99.49 99.49

4. Irrigation and Flood 1082.94 857.36 857.36

Control
5. Power 6199.49 6209.00 1736.00

6. Industry & Minerals 157.78 150.01 32.01

7. Transport 678.27 754.17 585.02

8. Scientific Services 3.48 5.94 5.94

9. Social & Community 3888.37 4351.97 3726.97

Services
10. Economic Services 242.64 280.71 280.71

11. General Services 37.21 124.01 124.01

Total 14020.00 14915.77 9350.00

The State Government has also accorded highest priority to Social &Community Services
and Power Sectors in the revised estimates. Revised Budgetary Support for the Social &
Community Services is 39.86% and for the Power Sector it is 18.57%. An expenditure of
Rs. 10445.28 Crore has already been incurred up to December, 2008.
Table-5: The Annual Plan for 2009-10

The Annual Plan for 2009-10 was proposed at Rs. 17321 Crore of which budgetary support
is Rs. 9636.31 Crore. Highest priority has been accorded to provide sufficient state
matching share for Flagship Programs, Centrally Sponsored Schemes and completion of
ongoing projects / schemes.

The major head wise proposed outlay is as under:-

(Rs. in Crore)

Head of Development / Proposed % to Of which % to

Sector Outlay total Budgetary total
Support
1 2 3 4 5
1. Agriculture & Allied Services 885.55 5.11 714.55 7.42
2.Rural Development 1365.76 7.88 1365.76 14.17
3. Special Area Program 92.25 0.53 92.25 0.96
4. Irrigation and Flood Control 942.01 5.44 942.01 9.78
5. Power 7483.97 43.21 1940.97 20.14
6. Industry & Minerals 139.62 0.81 19.62 0.20
7. Transport 615.99 3.56 503.49 5.23
8. Scientific Services 2.20 0.01 2.20 0.02
9. Social & Community 5626.86 32.49 3888.67 40.35
10. Economic Services 100.38 0.58 100.38 1.04
11. General Services 66.41 0.38 66.41 0.69
Total 17321.00 100.00 9636.31 100.00

The State Government has accorded highest priority to Social & Community Services and
Power Sectors. Budgetary Support for Social & Community Services is 40.35% and for
Power Sector it is 20.14%.

2.8 Special Category Status to Rajasthan

Special Category States have been given special treatment in the allocation of Central
Assistance as well as in the terms on which Central Assistance is extended to them. At
present, as per the Gadgil formula, after setting apart, funds for externally aided projects and
a reasonable amount for Special Area Programs, 30 % of the balance of central assistance
for State Plans is provided to Special Category States. The remaining amount of central
assistance for State Plans is distributed among non-special category states.
While ‘Special Category States’ are entitled to receive Central Assistance on the basis of 90
percent grant and 10 percent loan in place of 70 percent loan and 30 percent grant
admissible to ‘Non-Special Category States’. For placing any State on the list of ‘Special
Category States’ it should satisfy following conditions:

1. Hilly and difficult terrain,

2. Low population density and/or sizeable share of tribal population,

3. Strategic location along borders with neighboring countries,

4. Economic and infrastructural backwardness, and

5. Non-viable nature of state finances.

Besides above, States under this category have a low resource base and are not in a position
to mobilize resources for their developmental needs even though the per capita income of
some of these states is relatively high.

In 1969, when the Gadgil formula for the distribution of central assistance for State Plans
was evolved, there were only 3 Special Category States i.e. Assam, Nagaland and Jammu &
Kashmir. Presently, 11 States are on the list of ‘Special Category States’. These are Assam,
Jammu & Kashmir, Nagaland, Himachal Pradesh (1970- 71), Manipur (1971-72),
Meghalaya (1971-72), Tripura (1971-72), Sikkim (1975-76), Arunachal Pradesh (1986-87),
Mizoram (1986-87) and Uttaranchal (2001-02).

The last State placed on the list of ‘Special Category’ is Uttaranchal, which was declared by
NDC in its 49th meeting held on 1.9.2001. In this meeting, some suggestions have been
made for looking into the criteria for granting special category status to other States. It was
decided by the NDC that these should be examined. But no progress has been made so far.
Rajasthan has been continuously demanding to declare it as a ‘Special Category State’ at
various forums. The grounds on which the State deserves 'Special Category Status' are:

1. Rajasthan is severely deficient in the most important resource, that is, water. With
10.4 percent of the country’s area and 5.6 percent of its population, Rajasthan has
only about 1 % of the country’s water resources.
2. Agriculture continues to be susceptible to the vagaries of the monsoon; 43 out of last
50 years have been drought years. There has been a continuous decline in the
availability and quality of drinking water.

3. Rajasthan is the largest State in the country in terms of area. Over 60 percent of the
State’s total area covering 12 districts and habituating 40 % of its population is
Great Indian Desert, the “Thar” with sparsely distributed population. This special
feature directly affects the relative cost of delivery of infrastructure and basic social
facilities.

4. 1040 Km. long international border with Pakistan.

5. Population density is very low; 165 people per sq. km. in 2001 against the national
average of 324 people. There are large variations in density of population from
district to district. It varies from 471 people (Jaipur) to 13 people (Jaisalmer).

6. More than 12% of the population of the State is tribal.

Proposals for one-time Additional Central Assistance

Planning Commission, Government of India is requested to approve one-time Additional

Central Assistance of Rs. 150 Crore for following projects for the year 2009-10:

S.No Project Amount ( in Crore)

1 Goverdhan Drain Project for Keoladeo 35.00

National Park (balance amount)
2 Project to check rising ground water in Jodhpur 30.00
3 Support to Rajasthan Mission on Livelihood (RMoL) 30.00

4 IT enabled Grievances and Redressal System in Districts 5.00

5 Preparation of Medical Profile of Students 5.00

"Health Cards" in selected Districts
6 Support to NGOS for the protection of Girl Child in 5.00
Jaisalmer / Jalore Distrcits with low sex -ratio

7 Providing production subsidy for Khadi 5.00

8 Supporting activities of the new Minority 20.00

Department incl. Education etc.

9 Additional Housing for ST BPL families with a focus on 10.00

Kathodi Tribes in TSP area over and above IAY scheme
10 Welfare of Physically Challenged Persons 5.00

Total 150.00
Reserve Bank of India (RBI) today released “State Finances: A Study of Budgets of
2009-10”, a publication that provides data, analysis and assessment of finances of State
governments.

The major findings of the Study are as follows:

The consolidated fiscal position of the Rajasthan State Governments indicates that the
process of fiscal correction and consolidation experienced a slippage in 2008-09 (Revised
Estimates) on account of overall macroeconomic slowdown following the global financial
crisis. The key deficit indicators are as follows:

The Gross Fiscal Deficit (GFD) is budgeted to increase to 3.2 % of GDP in 2009-10
(Budget estimates) as compared with 2.6 % of GDP in 2008-09 (RE).

Revenue account turned from a surplus of 0.2 % in 2008-09 (RE) to a deficit of 0.5 % of
GDP in 2009-10 (BE).

Disaggregated level fiscal indicators reveal that most of the States are faced with
deterioration in revenue balance and increase in the level of GFD. State-wise, revenue
account of four States, viz., West Bengal, Punjab, Kerala, and Rajasthan recorded revenue
deficit during 2008-09 (RE). Jharkhand turned from revenue deficit to revenue surplus
State. In 2009-10 (BE), 10 States are expected to show revenue deficit from surplus in the
previous year. Overall, revenue account is expected to be adversely impacted in case of 23
States during 2009-10 (BE).

Number of States with GFD-GSDP ratio of less than 3.0 % decreased from 18 in 2007-08
(Accounts) to 9 in 2008-09 (RE) and 6 in 2009-10 (BE). GFD is estimated to exceed 3.0 %
of GSDP during 2009-10 (BE) in States like Maharashtra, Madhya Pradesh, Andhra
Pradesh, Rajasthan, Haryana, Orissa, Jharkhand, Uttar Pradesh, Punjab, West Bengal and
Goa. However, despite the slowing down of revenue and the need for increased expenditure
on account of economic slowdown, States like Kerala, Bihar, Karnataka, Chhattisgarh,
Gujarat and Tamil Nadu have been successful in limiting their fiscal deficit within the
TwFC target of 3.0 % of their GSDP during 2009-10.

The debt-GDP ratio of Rajasthan State governments came down to 26.2 % in 2008-09 (RE)
from the peak level of 32.8 % as at end-March 2004. However, outstanding debt is budgeted
to increase marginally to 26.5 % of GDP at end-March 2010. The TwFC had recommended
for a debt-GDP ratio of 30.8 % to be achieved by the States as at end-March 2010. As
against the TwFC target of interest payment to revenue receipts (IP-RR) ratio of 15 % to be
achieved by 2009-10, the combined IP-RR ratio of the States declined from 26.0 % in 2003-
04 to 14.4% in 2008-09 (RE). IP-RR ratio is budgeted to rise marginally to 14.5 % in 2009-
10.

On reform side, few State governments that have announced fiscal stimulus packages
envisages higher spending and lower tax rates for certain sectors in order to boost aggregate
demand. An additional factor that is likely to influence the State finances during 2009-10
but having positive implications for aggregate demand is the implementation of Sixth
Central/States’ Own Pay Commission. The Rajasthan State governments account for around
60 % of the combined expenditure of Centre and States reflecting the vital role of States in
growth and development of the economy. Compression in consolidated expenditure of State
governments can be observed during 2005-10 period mainly on account of some
rationalisation of revenue expenditure during the FRL period. This is evident from the
decline in Revenue Expenditure-GDP ratio from 13.3 % in 2000-05 to 12.4 % during 2005-
10. Empirical exercise indicated convergence of the major components of the development
expenditure across the States.

Report suggested that, Rajasthan may consider strengthening the rule based formula by
incorporating elements which inter alia may include counter-cyclical fiscal policy
framework, setting up of fiscal stabilisation fund, a target for debt-GSDP and interest
payments-revenue receipts with a view to attaining debt sustainability. In addition, a rule
may be prescribed for primary revenue balance (PRB), i.e., PRB should be in surplus and
adequate enough to meet interest payments of the States. Furthermore, numerical targets in
respect of certain categories of expenditure such as, non-interest revenue expenditure with
sub-targets for revenue expenditure on social services and on economic services;
institutional reforms such as common budgetary practices, transparency rules, accounting
system, public expenditure management and outcome budgeting; and independent audit
mechanism and transparent oversight and monitoring have been suggested. States may also
attempt to avoid build-up of cash surplus by adopting advanced forecasting and monitoring
mechanism keeping in view the best practices across advanced economies.

The Study highlights that, the fiscal correction and consolidation witnessed in State finances
in the recent past is likely to have a setback in 2008-09 (RE) due to the economic slowdown
and the accompanying moderation in the pace of revenue growth. The Study emphasises
that the States need to successfully manage the transition with regard to the implementation
of award of the Sixth Central/States' Pay Own Commission. In addition, there are certain
structural issues that continue to remain important for State finance, such as quality of
expenditure and surplus in cash balances of the State governments. With experience
gathered through their FRLs, States need to plan the next round of reforms and resume the
process of fiscal correction and consolidation at the earliest. Rajasthan has been investing in
capacity building through development of a strong institutional network at all levels. The
state has 1,050 colleges including 80 engineering colleges, 58 polytechnic institutes and 846
industrial training institutes (ITIs).

Rajasthan͉s rugged forts, beautiful palaces, picturesque Thar Desert, bird sanctuaries and
national parks, lively fairs and festivals, lakes and mountains, fascinating handicrafts and
colourful culture make the state an attractive destination for domestic and foreign tourists.
At current prices, the Gross State Domestic Product (GSDP) of Rajasthan was about US$
46.4 billion in 2009-2010. The average annual GSDP growth rate, from 1999-2000 to 2009-
2010 was about 10.1%.

The natural resources, policy incentives and infrastructure in the state are favourably suited
for investments in sectors such as cement, IT and ITeS, ceramics, tourism, automotive and
agro-based industries. Bureau of Investment Promotion (BIP) and Rajasthan Industrial
Development and Investment Corporation (RIICO) are responsible for promoting
investments and developing industrial infrastructure in the state. The Government of
Rajasthan is promoting development of several SEZs across the state for sectors such as
gems and jewellery, handicrafts, IT, electronics and textiles.

According to the Reserve Bank of India, FDI inflows from April 2000 to May 2010
amounted to US$ 470 million.

2.8.1 Advantage Rajasthan:

• Leading producer of cement in the country

• Second largest mineral producing state in the country, large reserves of metallic and
non-metallic reserves
• Among the largest producers of cotton and wool in the country
• A well known tourist destination
• One of the most progressive states in electricity sector reforms
• Recent discovery of oil and gas reserves

Economic Snapshots of Rajasthan

Capital Jaipur
Area (sq km) 342,239

Population (Census 2001, million) 56.51

61.03
Literacy Rate (%)

Human Development Index 0.424 (All India rank 9th)

NSDP (US$ billion) 11.5
NSDP growth (10 years) (%) 6

Per Capita Income (US$) 327

Exports (US$ million) 965

National Highways length (km) 4,081

International Airport Jaipur
Jodhpur, Udaipur
Domestic Airport

Mineral based industries

Textiles

Tourism

Key Industries Gem and jewellery

Dimensional stones (marble and granite)

Agro-processing
Potential Industries Oil and gas

IT and ITES

Electricity generation and distribution

2.8.2 Emerging destination for IT and ITES industries

Rajasthan has a vast pool of trained professionals. Moreover, low cost of operations in well
developed cities of the state makes them attractive locations for IT and ITeS units. IT parks
with special infrastructure have been set up at Jaipur, Jodhpur, Kota and Alwar.

2.8.3 IT and ITES – Main company profiles in Rajasthan

Infosys

Infosys was set up in 1981; it is engaged in IT consulting, modular global sourcing, process
re-engineering, and BPO services; the company has operations in Australia, China and US.
It also has marketing and technological alliances with FileNet, IBM, Intel, Microsoft,
Oracle, etc. The company recorded a turnover of US$ 4.8 billion in 2009-2010.

Infosys BPO, the BPO-services division of Infosys, has opened BPO campuses at the
Mahindra Worldcity, Jaipur, Rajasthan. The company has also launched various industry-
specific programs in Rajasthan where it collaborates with universities in the state to improve
the BPO-specific skill sets.

Tech Mahindra

Tech Mahindra is a global systems integrator and business transformation consulting firm,
focused on the communications industry.

Tech Mahindra provides a wide variety of services ranging from IT strategy and consulting
to system integration, design, application development, implementation, maintenance and
product engineering. Tech Mahindra has accreditations such as ISO 9001:2000 certification,
SEI-CMM level 5 assessments and is also CMMI level 5 certified for software development
processes. The company has set up two software development centres in Jaipur, Rajasthan.

Genpact

Formerly known as GE Capital International Services, Genpact was set up in India in 1997.

The company provides a wide range of business process, technology and knowledge
services in finance and accounting, collections and customer relations, insurance,
procurement and supply chain, analytics, software, IT-infrastructure.

It recorded a turnover of US$ 1.5 billion in 2010. The company employs about 43,300
professionals in total and over 3,000 people in the Jaipur facility.

Wipro Technologies

Wipro Technologies was established in 1945; it is engaged in IT services, product

engineering, technology infrastructure services, BPO and other consulting solutions. It also
provides services such as application development, deployment and maintenance, business
intelligence and customer relationship management. Based in Bengaluru, the company has
54 development centres and 30 offices spread across India, North America, Middle East and
Europe.

It recorded a turnover of US$ 6.0 billion in 2009-2010.Wipro Technologies has set up a

campus at the Mahindra World City in Jaipur. The company is developing its campus in two
phases; the first phase – spread across 25 acres, with a seating capacity of 1,000 employees
– is operational.

Nagarro

Nagarro provides outsourced software development services to companies ranging from

early stage start-ups to the global 50 market leaders, helping them achieve their strategic
goals.

The company has signed an MoU with the Mahindra World City for developing a five-acre
site in the Mahindra World City SEZ.

HCL

The 35 year old enterprise, founded in 1976, is one of India's original IT garage start ups. Its
range of offerings span R&D and Technology Services, Enterprise and Applications
Consulting, Remote Infrastructure Management, BPO services, IT Hardware, Systems
Integration and Distribution of Technology and Telecom products in India. The HCL team
comprises 90,000 professionals of diverse nationalities, operating across 31 countries
including 505 points of presence in India. HCL has global partnerships with several leading
Fortune 1000 firms, including several IT and Technology majors.

HCL Infosystems Ltd at Jaipur. Spread over an area of 4,175 Sq. meters, the ‘HCL Centre
of Excellence for BFSI software’ is the first software development centre to be opened by
any of the major ICT companies, in the state of Rajasthan. This centre will be developing
software with bi-lingual capabilities which is very critical for facilitating banking in smaller
towns and rural operations of private/nationalized banks and as well as cooperative banks.
HCL is an established player in the BFSI System Integration space and offers solution like
core banking solutions cheque truncation, cash management, treasury solutions, document
management solutions, risk management solutions, MIS & BI, data centre design & branch
rollout solutions.

2.9 Vision-2020

Land, minerals, energy, and manpower are key resources available in abundance, while
there is water shortage. Focus on dry land farming, marketing of exotic minerals, utilisation
of wind and solar energy (other than oil and gas), and skill development for people to avail
right to opportunities in the emerging economic environment. Tourism and infrastructural
services are key areas. Other than conventional means, utilise non-resident Rajasthanis for
information dissemination regarding heritage tourism. Provide education facilities (through
development of centres of excellence with investment from tourism companies) to tour
operators and guides. Introduce new curriculum at the graduate level and build training
institutes (e.g. for para-medical personnel) for service-oriented jobs. Develop a facilitation
centre (for information dissemination and other related services for temporary mobility of
labour) as export of manpower (e.g. for construction services) is a key opportunity. After
the review of literature, reports, journals, papers, available researcher found whether is
poverty reduction, creation of wealth, improvement in health and education or attaining a
better macro socio-economic environment, raising income of common citizens is inevitable.

Therefore, if Rajasthan can leverage its core competence to drive the state on an accelerated
growth path, it is likely that a higher growth rate which would help people to achieve better
standards of living. This will, in turn, help Rajasthan to contribute more towards India
becoming a ‘developed’ nation (in terms of per capita income and socio economic
indicators) by the year 2020.This can be a reality, provided appropriate and innovative
policy measures are introduced and there is coherence between different policies and their
implementation. Coherence is not only required at different level in a state, but also among
different states and between a state and the center.

The challenge for Rajasthan is to raise its per capita income (i.e. per capita SDP) from
Rs.13,800 in year 2002 to Rs. 25,000 by year the year 2010 and Rs.55,000 by the year 2020
This is possible, provided appropriate measures are taken for economic development and
accompanied by measures for social development so that the average decadal rate of growth
of population becomes 24 percent for the period 2001-2011 and 18 percent during 2011-
2021.