KATHMANDU UNIVERSITY

SCHOOL OF ENGINEERING
DEPARTMENT OF CIVIL AND GEOMATICS ENGINEERING

A PROJECT REPORT ON

SUITABILITY ANALYSIS OF INDUSTRIAL SITE SELECTION FOR PROVINCE 1

PROJECT MEMBERS

Sijan Bhandari (04)

Naresh Bista (05)

Sagar Dhami (09)

Dikpal Mahat (17)

SUPERVISORS

Asst. Prof. Subash Ghimire

Ms. Neha Joshi

3rd February 2019

 ACKNOWLEDGEMENT

It is always pleasure to remind all the fine people in Department of Civil and Geomatics
Engineering from Kathmandu University for their sincere guidance we received to uphold our
theoretical as well as software operating skills in third year project.
We all have taken equal efforts in this project. However, it would not have been possible without
the kind support and help of many individuals. We would like to extend our sincere thanks of gratitude
to our Project supervisors Assistant Professor Subash Ghimire and Ms Neha Joshi for their continuous
guidance, comments and suggestions throughout the course of the project.
We would also like to express our sincere appreciation to Assistant Professor Uma Shankar
Panday, Assistant Professor Reshma Shrestha for their insightful recommendations.
And similarly special thanks to Mr. Roshan Poudel, Mr. Om Prakash Vandary and Mr. Surendra
Siwakoti for essential support for our project.
Abstract
Economic development plays a key role in developmental activities of a nation. Establishment of
industries helps to increase economic development and create employment opportunities from
local to national levels. However, there are negative effects of an industry majorly in areas with
residential habitat and natural resources. This project mainly deals with the analysis of site
selection for establishment of industries using GIS based AHP.
GIS is mostly used software for any suitability analysis project. In this project, the major criteria
considered to determine suitable sites for industries are economic factors, environmental factors,
and ecological factors. These factors are assigned with different weightages and after GIS analysis
these are overlaid. The result shows areas that are suitable for industrial establishment based on
these criteria. Furthermore, the area found suitable is rated from most suitable to least suitable.
The final map display areas of high suitability based on those factors. This Project results in a
successful solution for spatial decision support in the case of spatial analysis of Province 1 as a
region of interest for Industrial site selection.
 Table of Contents
LIST OF ABBREVIATIONS ..................................................................................i

LIST OF FIGURES ................................................................................................ ii

LIST OF TABLES ................................................................................................. iii

1 INTRODUCTION ...............................................................................................1
1.1 Background .................................................................................................................. 1

1.2 Objectives Accomplished ............................................................................................ 1

1.3 Scope of Work ............................................................................................................. 1

1.4 Problem Statement ....................................................................................................... 2

1.5 Study Area.................................................................................................................... 2

2 LITERATURE REVIEW ...................................................................................3

2.1 Suitability Analysis ...................................................................................................... 3

2.2 Need for Weighted Site Selection Analysis ................................................................. 3

2.3 Criteria Selection.......................................................................................................... 3

3 METHODOLOGY ..............................................................................................5
3.1 Data Collection ............................................................................................................ 5

3.2 Data Analysis ............................................................................................................... 5

3.2.1 Suitability Level Determination ................................................................................................ 5

3.2.2 Pairwise comparison method .................................................................................................... 6

3.3 GIS Analysis ................................................................................................................ 9

3.3.1 Restriction Model...................................................................................................................... 9

3.3.2 Suitability Model....................................................................................................................... 9

4 OUTCOMES AND ANALYSIS .......................................................................10

4.1 Restriction Map .......................................................................................................... 10

4.2 Suitability Map ........................................................................................................... 11

 4.3 Rating Maps ............................................................................................................... 12

4.3.1 Land Use ................................................................................................................................. 12

4.3.2 Roads....................................................................................................................................... 13

4.3.3 National Parks ......................................................................................................................... 14

4.3.4 Water Resources ..................................................................................................................... 15

4.3.5 Settlement Areas ..................................................................................................................... 16

4.3.6 Transmission Lines ................................................................................................................. 17

5 RESULTS ...........................................................................................................18

6 CONCLUSION AND RECOMMENDATIONS.............................................19

6.1 Conclusion ................................................................................................................. 19

6.2 Limitations ................................................................................................................. 19

6.3 Recommendations ...................................................................................................... 19

7 REFERENCES ...................................................................................................20
LIST OF ABBREVIATIONS

AHP Analytical Hierarchy Process

CI Consistency Index
CR Consistency Ratio
m Meter
RI Random Index
WLC Weight Linear Combination

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 LIST OF FIGURES
Figure 1.1 Map of Province 1 2
Figure 4.1 Restriction Map 10
Figure 4.2 Suitability Map 11
Figure 4.3 Rating Map of Land Use 12
Figure 4.4 Rating Map of Roads 13
Figure 4.5 Rating Map of National Parks 14
Figure 4.6 Rating Map of Water Resources 15
Figure 4.7 Rating Map of Settlement Areas 16
Figure 4.8 Rating Map of Transmission Lines 17
Figure 5.1 Pie-chart 18

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 LIST OF TABLES
Table 1: Suitability Levels (Lukokoa & Mundiab, 2016) 5
Table 2 Pairwise Matrix 6
Table 3 Normalization of pairwise matrix 7
Table 4 Weights Calculation 8
Table 5 Value table 8

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1 INTRODUCTION
This section encompasses background of the project, the major objectives addressed, the scope
and the necessity of the project.
1.1 Background
An Industry is a business activity which is related to the raising, producing, processing and
manufacturing the products. Suitability analysis is a type of investigation used to determine the
best place for the required needs. Potential sites used in suitability analysis can include the location
of a new hospital, dumping site, store or school among many others. When performing site
selection analysis, users must set various criteria from which the GIS software can rate the best or
ideal sites.
Technological development in computer science has introduced geographic information system
(GIS) as an innovative tool in landfill process. GIS combines spatial data (maps, aerial
photographs, satellite images) with the other quantitative, qualitative and descriptive information
databases. This technology offers an analytical frame work for data synthesis that combines a
system capable of data capture, storage, management, retrieval, analysis and display.
1.2 Objectives Accomplished
The primary objective of this project was to find most suitable sites for establishment of industries
in Province 1. In the process of attaining this objective, we also accomplished the following
objectives:
 Different rating maps of the selected sites on the basis of the suitability factors.
 Restricted zones for the establishment of industry from Province 1.
 Used of AHP methods in GIS environment as decision support tool for industrial site selection.
1.3 Scope of Work
The project deals with the determination of suitable areas for establishment of industries in
province 1. The suitable areas are decided considering major environmental, ecological and
economic criteria. The data used for the analysis were from secondary sources so the accuracy
obtained is limited. The results can be used as guidelines for the establishment of industries such
that the industries benefit in a way that does not negatively impact the society and the natural
resources.

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1.4 Problem Statement
The random establishment of industries in past few years in Nepal has been found to be responsible
for environmental degradation as well as socio-economic problems. Major factors affecting the
location of industrial areas have not been considered. Therefore, a study is required to minimize
the negative impacts on society and environment that also provides for the smooth running of
industry.
1.5 Study Area
This project deals with the establishment of industries in Province 1.

Figure 1.1 Map of Province 1

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2 LITERATURE REVIEW
Different research papers, books and blogs were studied and supervisors were consulted. A
framework was then established on how, what and when activities were to be done:
2.1 Suitability Analysis
Suitability Analysis is the process and procedures used to establish the suitability of a system - that
is, the ability of a system to meet the needs of a stakeholder or other user.
Before GIS (a computerized method that helps to determine suitability analysis) was widely used
in the mid to late 20th century, city planners communicated their suitability analysis ideas by laying
transparencies in increasing darkness over maps of the present conditions. This technique's
descendant is used in a GIS application called Multi Criteria Decision Analysis in order to feed a
growing population that is pushing on the ability to extensively farm, suitability analysis is
becoming more necessary to utilize the most productive land to its fullest potential, matching the
needs of the plants more carefully to the existing assets in the environment. This technique is
known as precision farming. Suitability analysis can also be used to track and label potential
hazards, like earthquakes, contamination, or even crime. It can also be used to locate advantageous
locations for commercial centers. (Wikipedia, 2019)
2.2 Need for Weighted Site Selection Analysis
Weighted site selection or suitability analysis is best to use with raster data when a user
needs to find a site based on a number of criteria such as the following problems explained
by the ESRI Virtual Campus course 'Using Raster Data for Site Selection'
• When one needs to find the rankings of suitability for cells in a raster dataset
• When one needs to find next-best site options in addition to finding an ideal site
• When data has a distinct boundaries and other levels of certainty
• When the user determines where something will go based on specified criteria
• When the user wants to rank different criteria as more or less important in finding an ideal
site
2.3 Criteria Selection
Criteria are the set of requirements specially used as the base to carry out any sort of decision.
They are of two types:
a. Factor: It is defined as a criterion that increases or decreases the suitability of a specific
alternative for the activity under considerations. It is usually measured on a continuous scale.

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b. Restriction: Restrictions/Constraints will be expressed in the form of Boolean map i.e. areas
excluded from the considerations are coded with a 0 and those open for considerations are coded
with 1.
Let us take an example, for the establishment of industrial sites those areas which have proper
accessibility to roads are preferred more, but it doesn’t mean that the industrial site should overlap
with the existing road network for which they are considered as the restricted zones.
The factors that are to be considered for industrial sites are (Lukokoa & Mundiab, 2016):
a. Slope: Slope is one of the important factors for determining the area for selection of site. Flat
area is recommending for the Industrial sites. Area with steep slope may result in high probability
of geological hazards.
b. Distance from Roads: The areas should be selected in such places with the good availability of
road/rail networks for raw materials and goods supply. This approach will minimize the
transportation cost.
c. Distance from Water resources: The site should be selected such that water bodies do not get
contaminated from the waste materials form the industry site. However, it's been a trend to
discharge waste materials into water bodies after the proper treatment of harmful elements, the
distance should be wisely chosen.
d. Transmission Lines: Electricity being one of the major components for the establishment of the
Industries, no modern factory or industry can operate without it. It is always better to prefer those
areas where electricity can be easily accessed. Moreover, the site should be selected in such a way
to reduce the power cable transfer cost.
e. Distance from settlements areas: Sites should be at a considerable distance from settlement
areas such that it compensates proper sanitation of community area as well as takes minimum
transportation expenses.
f. Distance from National parks and wild life reserves: Establishment of industrial sites should be
as far as possible from such areas as so to protect flora and fauna and the area from wildlife hazards.
g. Land Use: For establishment of Industrial sites land use parameters should be considered
strictly.

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3 METHODOLOGY
This section includes the collection of required data and the evaluation of different map criteria.
3.1 Data Collection
Data used on the project were collected from the secondary sources. The collected data were shape
files which consist of points as settlement areas, polylines as roads, water recourses, power line
and polygons as national parks, wild life reserves and land use.
3.2 Data Analysis
For the suitability analysis of suitable industrial sites, geospatial data, utilities data and political
data were used. Data associated with transportation, settlement, water bodies etc. were used in GIS
analysis for the suitable industrial sites selection.
3.2.1 Suitability Level Determination
Suitability levels are ranked as highly suitable, moderately suitable, marginally suitable and not
suitable. These levels are determined based on literature review from different thesis, papers, blogs
etc. related to industrial suitable sites. The criteria with their units and suitability levels are given
in the table below.
Table 1: Suitability Levels (Lukokoa & Mundiab, 2016)

(National Parks and Conservation Act Nepal, 2029 , 2029)

Criteria Units Highly Moderately Marginall Not

Suitable Suitable y Suitable Suitable

Slope Percentage 0-20 20-30 30-40 >40

Distance from Roads m 0-2000 2000-6000 6000-7000 >7000

Distance from Water Resources m >5000 3000-5000 1500-3000 <1500

Transmission Lines km 0-1 1-5 5-10 >10

Distance from Settlements Areas m >5000 3000-4000 4000-1500 <1500

Distance from National Parks m >8000 6000-8000 3000-6000 <3000

Land Use Category Barren Grass Land Forest Agriculture

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 3.2.2 Pairwise comparison method
The pairwise comparison method was established by T. Satty (1980) for determining factor
weights in the AHP. This method involves pairwise comparison to create a ratio matrix which
takes the pairwise comparisons as an input and produces the relative weights as output. The
weights are determined by normalizing the Eigen vector correlated with the maximum Eigen value
of the reciprocal ratio matrix (Malczewski, 1999).
a. Development of a pairwise comparison matrix:
The method uses a scale with values ranging from 1-9 to rate the relative preferences for different
criteria and then a matrix is prepared as shown in the table below:
Table 2 Pairwise Matrix

Criteria Slope Distance Distance Transmissi Distance from Distance Land

from from on line Settlements National Use
Roads Water Areas Parks
Resourc
es

Slope 1 2 3 4 5 6 7

Distance from ½ 1 2 3 4 5 6
Roads

Distance from 1/3 1/2 1 2 3 4 5

Water Resources

Transmission line ¼ 1/3 1/2 1 2 3 4

Distance from 1/5 1/4 1/3 1/2 1 2 3

Settlements Areas

Distance from 1/6 1/5 1/4 1/3 1/2 1 2

National Parks

Land Use 1/7 1/6 1/5 1/4 1/3 1/2 1

Total 2.593 4.450 7.283 11.083 15.833 21.5 28

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b. Normalization of Pairwise Matrix
Table 3 Normalization of pairwise matrix

Criteria Slope Distance Distance Tran Distance from Distanc Land

from Roads from smiss Settlements e from Use
Water ion Areas Nation
Resource line al
s Parks

Slope 0.386 0.449 0.412 0.361 0.316 0.279 0.250

Distance from 0.193 0.225 0.275 0.271 0.253 0.233 0.214

Roads

Distance from 0.129 0.112 0.137 0.180 0.189 0.186 0.179

Water Resources

Transmission line 0.096 0.075 0.069 0.090 0.126 0.140 0.143

Distance from 0.077 0.056 0.046 0.045 0.063 0.093 0.107

Settlements Areas

Distance from 0.064 0.045 0.034 0.030 0.032 0.047 0.071

National Parks

Land Use 0.055 0.037 0.027 0.023 0.021 0.023 0.036

Total 1.000 1.000 1.000 1.000 1.000 1.000 1.000

c. Computation of the Criterion Weights:

The computation of weights involves three operations, first add the values in each column of the
matrix, then each element in the matrix should be divided by its column total (the resulting matrix
is referred to as the normalized pairwise comparison matrix). Afterwards, computation of the
average of the elements in each row of the normalized matrix should be made which includes
dividing the sum of normalized scores for each row by the number of criteria. Finally, these
averages provide an estimate of the relative weights of the criteria being compared.

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Table 4 Weights Calculation

Criterion Weight

Slope 0.350

Distance from Roads 0.238

Distance from Water Resources 0.159

Transmission line 0.106

Distance from Settlements Areas 0.070

Distance from National Parks 0.046

Land Use 0.032

Total 1.000

d. Estimation of Consistency Ratio:

Estimating the consistency ration helps to determine if the comparisons are consistent or not. The
process uses several steps.
CI= (𝝀max - n)/ (n-1)
Finally, Consistency ratio (CR) is gives as:
CR = CI / RI
For which Consistency Ratio should be less than 0.01, i.e. CR<0.01 (Satty, 1980)
For n= 7 RI is defined as 1.32
Random Inconsistency Indices (RI) for n=1, 2……, 15
Table 5 Value table

n RI n RI n RI

0.00 6 1.24 11 1.51

1 0.00 7 1.32 12 1.48
2 0.58 8 1.41 13 1.56
3 0.90 9 1.45 14 1.57
4 1.12 10 1.49 15 1.59
Source: Satty (1980)

Here, CI = (7.133 – 7)/7-1

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CI = 0.022
Now,
CR = 0.0222/1.32
CR = 0.01 < 0.10 (Acceptable) (Satty, 1980)
3.3 GIS Analysis
Following procedure were taken for the evaluation of data in ArcGIS software:
3.3.1 Restriction Model
A restriction model was developed in ArcGIS using model builder considering the constraints that
restricted the selection of the industries. The major factors to be considered were distance from
settlement areas, distance from water Resources, distance from roads and distance from national
parks. Different GIS operations were performed chronologically and a final overlay was done
among the different layers to obtain a final restriction map.

3.3.2 Suitability Model

Weighted Linear Combination is the most commonly used for determining suitability model.
Formula: S = ∑wixi x ∏cj (Hwang, 1981)
Where:
S – is the composite suitability score
xi – factor scores
wi – weights assigned to each factor
cj – constraints (or Boolean factors)
∑ -- sum of weighted factors
∏ -- product of constraints (1-suitable, 0-unsuitable)

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4 OUTCOMES AND ANALYSIS
The following Maps were obtained as the outcomes of the project:
4.1 Restriction Map
The restriction model was used to generate a restriction map that included two zones. The red part
represented the areas that were restricted for industrial sites while the green zones were not
restricted.

Figure 4.1 Restriction Map

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4.2 Suitability Map
The suitability model was used to generate a suitability map which shows the degree of suitability
for site selection.

Figure 4.2 Suitability Map

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4.3 Rating Maps
Rating Maps were generated which represent how each factor suits the selection of industries in
Province 1. These rating maps scale the areas on the basis of each factor. The rating maps,
according to each factor was obtained as follows:
4.3.1 Land Use

Figure 4.3 Rating Map of Land Use

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4.3.2 Roads

Figure 4.4 Rating Map of Roads

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4.3.3 National Parks

Figure 4.5 Rating Map of National Parks

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4.3.4 Water Resources

Figure 4.6 Rating Map of Water Resources

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4.3.5 Settlement Areas

Figure 4.7 Rating Map of Settlement Areas

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4.3.6 Transmission Lines

Figure 4.8 Rating Map of Transmission Lines

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5 RESULTS
Given Pie-chart shows the percentage of suitable zones in Province 1 from GIS analysis.

SUITABILITY LEVELS
Highly Suitable
17%

Not Suitable
43%

Moderately Suitable
24%

Marginally Suitable
16%

Not Suitable Marginally Suitable Moderately Suitable Highly Suitable

Figure 5.1 Pie-chart

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6 CONCLUSION AND RECOMMENDATIONS
6.1 Conclusion
The main objective of this project was to select suitable zones for the establishment of industries
using AHP and GIS Analysis.
This research indicates the possibility of GIS based analysis to select appropriate sites based on
different criteria and weightage values assigned to them.
6.2 Limitations
The limitations of our study are as follows:
 The updated data about the minor roads and transmission lines of remote Himalayan regions
were not available, so exact estimation of the sites might have been compromised.
 This project study was limited to the secondary source of data.
6.3 Recommendations
The analysis might have suffered from some errors due to the above mentioned limitations. There
are certain things that should be improved for the suitability analysis.
Primary data should be collected as it gives higher level of accuracy. There should be sufficient
time and budget allocated for collection of proper data. Similarly, satellite images could be used
as an alternative for traditional data sources.

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7 REFERENCES
(2019, Feb 01). Retrieved from Wikipedia: https://en.wikipedia.org/wiki/Suitability_analysis
ESRI. (2017). What is Model Builder? Retrieved 11 09, 2017, from ArcGIS Pro:
http://pro.arcgis.com/en/pro-app/help/analysis/geoprocessing/modelbuilder/what-is-
modelbuilder-.htm
Government, N. (2029). National Parks and Conservation Act Nepal, 2029 . Kathmandu, Nepal.
Hwang. (1981). Spatially-explicit integrated uncertainty and sensitivity analysis of criteria weights
in multicriteria land suitability evaluation.
Lukokoa, P., & Mundiab, C. (2016). GIS Based Site Suitability Analysis for Location of a Sugar
Factory in Trans Mara District. International Journal of Sciences: Basic and Applied
Reserarch, 324-338.
Malczewski, J. (1999). GIS and Multi Criteria Decision Analysis. Western Ontario: John Wiley
and Sons.
Satty, T. (1980). The Analytical Hierarchy Process. New York: McGraw Hill.

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