Meghalaya 2

MEGHALAYA
April 2010
MEGHALAYA April 2010
Investment climate of a state is determined by a mix of

factors
• Skilled and cost-effective labour • Procedures for entry and exit of firms
• Labour market flexibility • Industrial regulation, labour regulation,
• Labour relations other government regulations
• Availability of raw materials and natural • Certainty about rules and regulations
resources • Security, law and order situation
Resources/Input Regulatory framework

s Investment climate
of a state Physical and
Incentives to industry
social
• infrastructure
Condition of physical infrastructure such as
• Tax incentives and exemptions power, water, roads, etc.
• Investment subsidies and other incentives • Information infrastructure such as
• Availability of finance at cost-effective terms telecom, IT, etc.
• Incentives for foreign direct investment • Social infrastructure such as educational and
(FDI) medical facilities
• Profitability of the industry
2
Content
s
 Advantage Meghalaya
 State economy and socio-economic

profile
 Infrastructure status
 State policies and incentives
 Business opportunities
 Doing business in Meghalaya
3
ADVANTAGE MEGHALAYA
Meghalaya April 2010
Meghalaya – State
profile
• Covering an area of 22,429 sq km, Meghalaya
shares its border with Assam in the North and
Bangladesh in the South.
• The state has seven administrative districts.

Shillong is Meghalaya’s capital city; Sohra,Tura
Jowai, Nongstoin,Wiliamnagar, Nongpoh
and Baghmara are the other key cities.
• Meghalaya is the wettest state in the country

with an average rainfall of 1,200 cm. It has
numerous rivers, the major ones
being, Manda, Damring, Janjiram, Ringge, Ganol,
Sims ang, Khri, Umtrew, Umiam, Umkhem, Kupli,
Kynshi, U miam Mawphlang and Umngot.
• Meghalaya has diverse soil types including red-

loamy, laterite, and red and yellow soils.They
have fine textures ranging from loam to silty-
loam and alluvial soils.These types of soils
support a variety of agricultural crops.
• English is the official language of Meghalaya.

Khasi, Pnar and Garo are the other
principal languages.
4
ADVANTAGE MEGHALAYA
Advantage Meghalaya …
(1/2)
Institutional support
The state provides excellent institutional support through various central
and state government agencies viz., North East Council, Ministry of
Development of North Eastern Region and Meghalaya Industrial
Development Corporation.
Policy and fiscal incentives

The state offers a host of industrial incentives, apart from Central
Government incentives meant for investments in the Northeast region.
Agro-processing, horticulture, minerals, tourism, electronics and IT have
been identified as thrust sectors for development and promotion.
Rich natural resources

Meghalaya is endowed with abundant natural resources in terms of flora,
fauna, medicinal plants, forests, coal, limestone, feldspar,
quartz, sillimanite, granite, industr ial clay and uranium. They offer
significant avenues for investment.
5
ADVANTAGE MEGHALAYA
Advantage Meghalaya …
(2/2)
Availability of skilled labour
Meghalaya has a literacy rate of 62.6 per cent. The state has a
strong higher-education infrastructure. Moreover, a majority of
the local population speaks and understands English.
Conducive agro-climatic conditions

The state has favourable agro-climatic conditions that supports
agriculture, horticulture and forestry; there is potential for
development in related areas.
Tourism destination of the Northeast

The Meghalayan community has a rich culture and is an attractive
tourist destination.
6
ADVANTAGE MEGHALAYA
Meghalaya in
figures
Parameter Meghalaya All-states Source
Economy
GSDP as a percentage of all
0.2 100.0 CMIE, 2005-06, current prices
states’ GSDP
Average GSDP growth rate (%) 10.9 7.5 CMIE, 1999-2000 to 2007-08
Per capita GSDP (US$) 751.3 998.1 CMIE, 2007-08
Physical infrastructure
Central Electricity Authority,
Installed power capacity (MW) 189.1 98,996.4
as of March 2009
Cellular Operators Association
GSM cellular subscribers (No) 4,259,022* 367,328,179
of India, as of November
2009
Broadband subscribers (No) 14,202* 4,981,976 As of October 2008
Ministry of Road Transport
National highway length (km) 810 70,548
& Highways, 2007-08
Airports (No) 2 133 Industry sources
Social indicators
Literacy rate (%) 62.6 64.8 Census of India, 2001
Central Bureau of Health Intelligence,
Birth rate (per 1,000 population) 24.4 23.1
2007
* Figures for the Northeastern region comprising Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura
7
ADVANTAGE MEGHALAYA
Key industries with policy thrust and factor

advantages
Industry attractiveness
matrix
Hig
h
Tourism
IT Hydro
Minera
ls
Policy thrust
Agriculture and
Food processing horticulture
Medium
Handloom
Sericulture
Bambo
o
Low
Medium Hig
h
Factor advantage
*Factor advantages include benefits due to geographical location and availability of factors such as talent pool, natural resources
and capital
8
Content
s

profile
 Doing business in
Meghalaya
9
STATE ECONOMY A N D SOCIO-ECONOMIC
PROFILE
Socio-economic snapshot of
Meghalaya
Parameters Meghalaya
Capital Shillong
Geographical area (sq km) 22,429
Administrative districts (No) 7
Population density (persons per sq km) 131
Total population (million) 2.3
Male population (million) 1.2
Female population (million) 1.1
Population growth rate 1991-2001 (%) 30.65
Sex ratio (females per 1,000 males) 980
Literacy rate (%) 62.6
Male (%) 65.4
Female (%) 59.6
Source: Statistical Handbook, 2008-09
10
PROFILE
Meghalaya’s
GSDP
• At current prices, the Gross State Meghalaya’s GSDP
Domestic Product (GSDP) of (US$ billion)
Meghalaya was about US$ 1.89 billion 2007-08 1.89
in 2007-08. 2006-07 1.54
• The state’s GSDP grew at a CAGR of 2005-06 1.43
10.9 per cent between 1999-2000 and 2004-05 1.29
2007-08. 2003-04
1. 15 CA GR
2002-03
0.99 10.
2001-02 9%
• Agriculture, tourism, mining, trade, 0.94
constru ction and manufacturing
2000-01 0.87
industries contributed to the GSDP
1999-00
growth. 0.83
0.00 0.50 1.00 1.50 2.00
Source: CMIE
11
PROFILE
Meghalaya’s NSDP
• At current prices, the net state domestic Meghalaya’s NSDP
product (NSDP) of Meghalaya was about (US$ billion)
US$
2007-08 1.67
1.67 billion in 2007-08.
2006-07 1.36
• Meghalaya’s NSDP grew at a CAGR of 2005-06 1.27
10.6 per cent between 1999-2000 and
2004-05 1.15
2007-08.
2003-04 1.03 CAGR
2002-03 0.89
2001-02 0.85 10.6%
2000-01 0.79
1999-00 0.74
0.00 0.50 1.00 1.50 2.00
Source: CMIE
12
PROFILE
Meghalaya’s economic performance is driven by the

secondary and tertiary sectors
• At a CAGR of 21.6 per cent, the secondary Percentage distribution of
sector has been the fastest growing among sectors
the three sectors from 1999-2000 to 2007- 100
08.The growth has been driven by C AGR
manufacturing, construction and electricity. 80
63.8 61.5 11.1%
60
• The tertiary sector, the largest contributor to
Meghalaya’s economy, grew at a CAGR of 40 2.1 21.6%
11.1 per cent between 1999-2000 and 2007- 4.4
08; it was driven by trade, tourism, real 20
estate, transport and communications. 8.7
0 %
1999-00 2007-08
• The primary sector’s share in the GSDP has 36.4
been declining; it registered a CAGR of 8.7 Primary Sector Secondary Sector
31.8
per cent between 1999-2000 and 2007-08. Tertiary Sector
Source: CMIE
13
PROFILE
Per capita
GSDP
• Meghalaya’s per capita GSDP in 2007-08 Per capita GSDP
was US$ 751.3.
800.0 751.3
• The per capita GSDP has increased at a 700.0
579.8
619.4
CAGR of 9.3 per cent between 1999- 600.0
479.7
533.2
2000 and 2007-08. 500.0
(US$)
416.1
400.0 369.1 377.2 399.0
300.0
• The districts of East-Khasi Hills,West-Garo
200.0
Hills and Jainita Hills contribute to more
100.0
than 70 per cent of the state’s GSDP.
0.0
• Trade, manufacturing, tourism, construction,

tr ansportation and agriculture have been
the key contributors to per capita GSDP.
Source: CMIE
14
PROFILE
Key industries in
Meghalaya
• The natural resources, policy incentives and Key industries in Meghalaya
infrastructure in the state favour investments in the
Agriculture and food processing
tourism, hydroelectric power, manufacturing and
mining sectors. Horticulture
Mining
• Agriculture and related industry, contributes 21 per Cement
cent to the state’s GSDP and employs more than
Tourism
70 per cent of the population.
Hydroelectric power
• Mineral, horticulture, electronics, IT, export Dairy and livestock
oriented units and tourism have been identified as Handloom and handicrafts
the thrust sectors for industrial development.
Steel processing
• As of March 2008, there were 116 large and
medium industrial undertakings and 2,653 small
scale manufacturing units in Meghalaya.
• The Industries Department of Meghalaya and its

constituent unit, Meghalaya Industrial Development
Corporation (MIDC), are jointly responsible for the
development of industrial infrastructure in the
state.
15
PROFILE
Rice, potato, pineapple and banana are the key agricultural

products of Meghalaya
• In 2007-08, the state recorded an annual growth of Crop Annual production
1.4 per cent in agricultural income. (‘ooo tonnes)
Rice 203,485
• Citrus fruits, pineapple, banana, papaya, plum, peach Potato 167,030
and apricot are the major fruits grown in Pineapple 93,625
Meghalaya. Banana 71,695
Ginger 53,609
• Turmeric, ginger, black pepper, bay leaves are the
Citrus fruits 36,893
major spices cultivated in Meghalaya; the state is
also experimenting with tea cultivation in select Jute* 35,499
areas. Maize 24,424
Tapioca 20,841
• Around 9.8 per cent of the state is under Sweet potato 16,270
cultivation; and additional 20.1per cent land is Turmeric 10,508
available for cultivation offering immense potential
• for agricultural
Meghalaya production.
produced 97.8 million eggs and Source: Meghalaya Statistical Handbook, 2008-09
74.4 million tonnes of milk in 2006-07.
16
PROFILE
Meghalaya’s exports
trends
• In 2005-06, Meghalaya’s exported goods and Meghalaya’s exports
services worth US$ 47.7 million, accounting
for about 48 per cent of the total exports Export commodity Value
from the Northeast region. (US$
million)
• An export promotion industrial park (EPIP) Coal 37.50
has been set up in Byrnihat over an area of Limestone 2.70
250 acres to promote exports. Ginger 0.09
Crushed stone 0.07
• Meghalaya shares a 443-km border with Orange 0.05
Bangladesh and has eight land-custom
Boulder stone 0.05
stations to aid exports.
Source: State Development Report, 2008-09, as of 2005-06
• The key commodities exported to
Bangladesh are coal, limestone, boulder
stone, agricultural produce, and raw hides
and skins.
17
PROFILE
Sector-wise
investments
• Over US$ 2.3 billion of investments have Break up of investments by
been made in ramping up Meghalaya’s sector
infrastructure, as of December 2008.
125.0
• Over 60 percent of the investments have 538.8
been made in the area of
power, especially, hydroelectric
power generation and distribution.
250.2
• Tourism, cement industry, mining, air
1452.5
transport and railways are also expected to
receive significant investments over the
coming years.
Manufacturing Mining Electricity Services
Source: CMIE, as of 2008
18
Content
s

profile
 Infrastructure
status
Meghalaya
19
INFRASTRUCTURE STATUS
Roads, railways and

airports
• Meghalaya had a total road length of 8,371 km, Road length
Road type
with a road density of 36.4 km per100 sq km, as (Km)
of National Highways* 810
2007-08.
State Highways 1,137
• The state is well connected to its Major district roads 1,219
neighbouring Northeastern states and other Other district roads 5,205
parts of India through four National
Highways: NH-40, NH- 44, NH-51 and NH- Sources: Statistical Handbook, 2007-08, Ministry of
Road Transport & Highways
62. *As of 2007-08
• The nearest railway station is in Guwahati, Assam.

Land acquisition is in progress for the
construction of two railway stations at
Mendipathar and Byrnihat.
• Meghalaya has two airports located in Umroi

and Balajek.The Umroi airport is fully
operational, while the Balajek airport is
under construction.
• Helicopter services are available from Guwahati

to Tura and Shillong. Source: Maps of
India
• The Meghalaya Transport Corporation provides 20

Powe
•rAs of March 2009, Meghalaya had a total Installed state and private capacity
installed power capacity of 189.1 MW, all (MW)
under the Meghalaya Power Generation
189.5
Corporation. 189.1 189.1 189.1 189.1
• Hydroelectric power constitutes 187 MW, 189.0 188.8 188.8
the balance being generated from diesel.
188.5
• Meghalaya has a assessed hydroelectric
potential of 3,000 M W of which only 187 188.0
M W has been tapped. 187.6 187.6
187.5
• The per capita power consumption of 187.0

Meghalaya was 387.4 kWh as of 2007-
08. 186.5
2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09
• As of 2008, 73 per cent of the villages had
been electrified in the state, and plans are
underway to electrify the whole state by Source: Central Electricity Authority
2012.
• In April 2010, the State Government restructured the Meghalaya State Electricity Board (MeSEB) to create
a holding company called Meghalaya Energy Corporation Limited (MECL) and its three subsidiaries:
Meghalaya Power Generation Corporation (MePGCL), Meghalaya Power Transmission Corporation
Limited (MePTCL) and Meghalaya Power Distribution Corporation (MePDCL).
21
Telecom
infrastructure
• In 2007-08, Meghalaya had 118 telephone Telecom operators in Meghalaya
exchanges with 67,766 landline • Bharat Sanchal Nigam Limited (BSNL)
connections, 10,592* WLL connections
• Bharti Airtel
and 89,665** mobile phone connections.
• Aircel Limited
• As of 2007, there were 7,360 internet • Vodafone Essar
connections in the state including 1,621 • IDEA Cellular
working broadband connections. • Reliance Communications
• Tata Indicom
• Virtual private network (VPN) over
broadband line is also available in the state to
enable business communications. Source: State Development Report, 2008-09
• Meghalaya had 390 post offices as of

2007, providing postal services across the
state.
*As of 2006-07
**Mobile connections pertain to BSNL only
22
Urban infrastructure …
(1/2)
Water supply
• The average per capita supply of water in major cities and towns is 150-200 litres per day.
• Meghalaya has 16 urban agglomerations and about 71 per cent of the population in these is
provided with piped-water supply.
Sewerage
• Solid-waste segregation and disposal is diligently adhered to across the state.
• A 100 tonnes per day (TPD) compost plant in Shillong and 40 TPD plant in Tura are operational in
the public private partnership (PPP) mode for safe disposal of solid wastes.
• Sites have been identified in Williamnagar, Baghmara and Resubelpara and work has commenced
on developing compost plants.
23
Urban infrastructure …
(2/2)
• Under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM), two projects worth US$
47.4 million were approved in 2008-09 for developing urban infrastructure in Shillong; the aim is
to provide better drainage and drinking water supply.
• Under the Environmental Improvement of Urban Slums (EIUS) programme, 45 notified and five
slum areas in Shillong,Tura, Jowai, Baghmara,Williamnagar and Nongstoin have been provided with
basic amenities.
• The New Shillong township is being developed, based on the Shillong Master Plan, 1991-2011; the
new township would cover an area of 2,030 hectares, of which 500 acres is to be acquired and
developed by the government.
24
Education
infrastructure
• According to the Census 2001, Meghalaya had
Educational infrastructure (No)
a literacy rate of 62.6 per cent as of March
2001; male literacy rate was 65.4 per cent and Universities 1
female literacy rate was 59.6 per cent.
Colleges 56
• The North East Hill University (NEHU)
Polytechnics and ITI training institutes 8
provides Bachelors, Masters and Doctoral
degrees in the science, technology and Teacher training institutes 3
humanities streams.
High and higher secondary schools 774
• The North East Indira Gandhi Regional Institute
Middle and senior basic schools 2,259
of Health and Medical Sciences (NEIGRIHMS)
conducts bachelor of medicine and post graduate Primary and junior basic schools 6,351
courses in medicine; a bachelors of nursing
college also operates under its aegis.
S
o
u Pupil-teacher ratio of schools in Meghalaya
r
c Primary schools 34:1
e
:
Secondary schools 24:1
High and higher secondary schools 25:1

S
t
a
t
25 i
s
Health
infrastructure
• There are 10 private hospitals in the state with a Health infrastructure
total bed strength of 1,650 beds. • Primary health centres: 104
• Sub-centres: 404
• The state’s four military and paramilitary • Community health centres: 28
hospitals provide preventive and promotional • Hospitals: 9
healthcare services. • Dispensaries: 12
• Leprosy colonies: 2
• NEIGRIHMS, which has been instituted to • Leprosy control units: 2
provide medical education, has a 500 bed super- • Doctors: 671
specialty hospital; expansion works are • Nurses: 893
underway.
S
Health indicators o
u
Beds per 100,000 population# 137
r
Birth rate* 24.4 c
e
Death rate* 7.5 :
Infant mortality rate** 56 S
t
Sources: Statistical Handbook of Meghalaya, 2008-09 a
# State Development Report, 2008-09 t
*Per thousand persons, as of 2006-07 i
**Per thousand live births, as of 2006-07 s
t
i
26 c
a
Cultural
infrastructure
• Shad Suk Mynsiem, Nongkrem dance,Wangala, Behdeinkhlam, Laho dance, Chad Sukra,
Autumn festival, Strawberry festival, Ranikor festival are the well-known festivals of
Meghalaya.
• Meghalaya has varied tourist attractions such as caves, national parks and sanctuaries,
sacred groves, waterfalls, lakes and rivers – making it an ideal tourism destination.
• Meghalaya sports a 18-hole natural golf course, which is a major sport and corporate
attraction.
• Bara bazar, Jail road, G.S. road, Police bazar, Glory’s plaza, Meghaloom, Nagaland Handloom and
Handicrafts,Assam Emporium, India Emporium, Khadi Gramodyog, Manipur Emporium,Tantuja,
and Purbashree are the key shopping areas in Meghalaya.
• Capt.Williamson Sangma State Museum, Don Bosco Centre for Indigenous Cultures, Entomological
Museum (Butterfly Museum) are the famous museums of Meghalaya depicting its rich cultural
heritage.
• Lady Hydari park, Mattilang park, Sa-I-Mika park,Thangkharang park, Eco park in East Khasi hills;
Nehru park, Kharsati park,Thrills Fun park in Ri Bhoi; Nokrek National park in West Garo hills;
Balpakram National park in South Garo hills, Ialong park, Iooksi (Kupli) park in Jaintia hills are the
popular national parks and recreation centres in Meghalaya.
27
Industrial
infrastructure
• Meghalaya has industrial estates at Shillong, Nongstoin, Mawlyndep,Tura,Williamnagar and
Khliehtyrshi; an industrial area at Umiam; an export promotion industrial park (EPIP) at Byrnihat; and
a growth centre at Mendipathar.
• District Industrial Centres (DIC) are functional under the MIDC in each district and are involved
in industrial infrastructure development of the district.
• The state has constituted a single-window clearance agency for industrial investment approvals.
• Techno-economic feasibility reports (TEFR) are available with the MIDC for poultry, agro-based
industry, fruit processing, paper-grade lime, alcohol from tapioca, calcium carbonate extraction,
ceramic- glazed tile manufacturing, marble and tile, and meat processing.
• Under the central government’s Assistance to states for Developing Infrastructure for Exports
(ASIDE) programme, 29 infrastructure development projects have been approved, worth US$ 21.4
million.
28
Content
s

profile
 State policies and
incentives
Meghalaya
29
STATE POLICIES A N D
INCENTIVES
Sector-specific policies …
(1/7) North East Industrial and Investment Promotion Policy (NEIIPP), 2007
Aim: To promote the Northeast region as an attractive investment destination through various concessions and incentives.
Key features:
• Industries under this policy are eligible for incentives for a period of 10 years from the date of commencement
of commercial production.
• All units, new as well as the existing ones that undergo substantial expansion (minimum 25 per cent increase in fixed capital)
and start production before 2017, would qualify for the incentives.
• Incentives would be available for all existing industrial units and upcoming units anywhere in the Northeast.
• A high-level monitoring committee or advisory committee would oversee implementation of the NEIIPP.
• NEIIPP would not be applicable for peripheral activities such as preservation while storage, cleaning, packing, re-packing,
labelling or re-labelling, sorting, etc.
• North East Industrial Development Finance Corporation (NeDFI) will act as the nodal agency for disbursal of
subsidies.
• NEIIPP 2007 has replaced the North East Industrial Policy1997.
Continue
d..
30
INCENTIVES
(2/7) NEIIPP, 2007
Incentives and concessions:
• 100 per cent excise duty exemption on finished products made in the Northeast Region.
• 100 per cent income tax exemption for industrial units.
• Capital investment subsidy increased from 15 per cent to 30 per cent for plant and machinery up to US$ 360,000 per unit.
For units above US$ 360,000 of capital investment and up to US$ 7.5 million, an empowered committee approves. For
units above US$7.5 million the Union Cabinet approves.
• Interest subsidy to be given at the rate of 3 per cent on working capital.
• 100 per cent reimbursement of insurance premium.
31
INCENTIVES
(3/7) Industrial Policy, 1997
Aim: To facilitate rapid and sustained industrial development of the state.
Key initiatives:
• Meghalaya to develop general infrastructure such as road, power, water and communication.
• The state government to invite private sector in undertaking joint projects.
• MIDC to act as a channelling agency for obtaining credit for industrial development.
• DICs to serve as principal contact and guiding agency for entrepreneurs and investors.
• State government to set up single-window clearance for large and medium industries.
• Agriculture, horticulture, bio-technology, animal husbandry and meat processing, minerals, electronics and IT have been
identified as thrust sectors.
32
INCENTIVES
(4/7) Industrial Policy, 1997
• State capital investment subsidy provided at 30 per cent of the fixed capital, with a ceiling of US$ 43,000.
• Interest subsidy for bank loans at the rate of 4 per cent, with a ceiling of US$ 435 per month for a period of three years.
• Subsidy on power tariffs at the rates of 30 per cent and 25 per cent for loads up to 2 M W and above 2 MW, respectively.
• Cost of drawl of power-line above 33 kV is reimbursed if a separate line is required for the industry.
• Exemption from sales tax for a period of seven years from the date of commercial production.
• Refund of central sales tax paid on machinery and equipment up to the commissioning of the industry.
• Subsidy on cost incurred on quality control measures and pollution control measures.
• Exemption from stamp duty.
• Additional sales tax incentives, limited to the amount of capital subsidy.
• Additional 5 per cent capital investment subsidy for export oriented units.
33
INCENTIVES
(5/7) The Meghalaya State Tourism Policy, 2007 (Draft)
Aim: To promote tourism as an economic driver of the state
Key thrust areas:
• Nature tourism, adventure and sports tourism, cultural tourism, health tourism, golf tourism, convention tourism and
arts and crafts tourism.
• Public private partnership (PPP) mode to be given preference for infrastructure development and service delivery.
• Training centres to be set up by the Government to provide training in hospitality and tourism industry.
• Single-window clearance to be set up in cognizance with the NEIPP 2007.
34
INCENTIVES
(6/7) The Meghalaya State Tourism Policy, 2007 (Draft)
Aim: To promote tourism as an economic driver of the state
Key incentives and initiatives:
• Reimbursement of up to 30 per cent of realistic wage of local tribal employees, annually.
• Subsidy at the rate of 50 per cent for purchase and installation of power generation set, above 2 MW.
• 100 per cent refund of central sales tax (CST) on equipment and machinery installed as on the date of commissioning of the
unit.
• Stamp duty exemption up to 75 per cent on investments above US$ 434,782.
• Reimbursement of 25 per cent of the entertainment tax for theme parks and urban entertainment centres for a period of
five years
• Exemption from luxury tax for a period of five years.
• Reimbursement of 25 per cent of the value added tax (VAT) for five years from the commencement of operation.
35
INCENTIVES
(7/7) IT Policy, 2004
Aim: To create wealth, generate employment and bring in IT-led economic growth.
Key initiatives:
• Facilitate creation of IT infrastructure, software technology park and last mile connectivity to villages.
• Facilitate the establishment of IT enabled service centres in the state.
• To develop the human resource base required for the IT industry.
• Apply IT in governance and management of the state government programmes.
• Earmark up to 5 per cent of the government’s budget for IT-related expenditure.
• Over and above the state incentives for industrial units, 10 per cent subsidy to be provided for IT industries in respect
of power captive generation set, capital subsidy and capital rent subsidy.
36
Content
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profile

 Business
opportunities
Meghalaya
37
BUSINESS OPPORTUNITIES
Floriculture
• Meghalaya has a plant vascular diversity of 3,331; more than 300 varieties of orchids are found in the state.
• Decorative plants such as

dahlia, canna, gladiolus, begonia, tropaeolum, aster, polargonium, antirrhinum, crinum, celosia, kniphofia,
impati ens, chrysanthemum, petunias, pansy, calendula, sweet peas and salvia are found in abundance in the
state.
• The existing industry is at a nascent stage and has the potential to be developed and promoted for
export oriented business.
Medicinal plants and bamboo

• Meghalaya houses 834 of the 6,000 medicinal plants available in India.
• This sector has been identified as one of the priority sectors for investment by the state.
• Around 120 species have been identified for commercial production.
• Meghalaya is one of the leading producers of bamboo in the country; bamboo enterprises could be
developed from the bamboo reserves and forest cultivations.
38
Agriculture, horticulture and food

processing
• Meghalaya has a climate that supports agricultural and horticultural activities; the state offers potential
for investment in these areas.
• It supports multiple crops viz., rice, maize, pulses, oil seeds, cotton, jute, and mesta; Meghalaya
produces substantial quantities of oranges, peaches, pineapples, pears, guavas, plums, bananas,
potatoes, tapioca, bay leaves, ginger, maize and jackfruit.
• Meghalaya’s turmeric is considered one of the best in the world as it contains 7.5 per cent of
curcumine.
Hydroelectric power
• It is estimated that Meghalaya has a hydroelectric power capacity of 3,000 MW, of which only 187
M W has been developed so far.
• The state government is inviting investments in this area through the PPP mode. Independent
power producers (IPP) are also being invited to develop hydro projects in Meghalaya; this provides
immense potential for investment.
39
Tourism
•sector
Meghalaya is richly endowed with flora, fauna,
thick forests, ancient forest groves, large rivers
and grass fields – making it an attractive tourism
destination.
• The number of foreign tourists has increased by 24

per cent between 2006 and 2007. During the same
period, the domestic tourist population increased
by 14 percent from 400,287 in 2006 to 457,685 in
2007.
• PPP is being invited by the Meghalaya government
to create tourist complexes, eco-tourism,
adventure tourism, ethnic culture tourism, health Source: Maps of
India
farms, hotels, convention centres, tourist
travel services, etc.
IT sector
• The IT policy of Meghalaya defines the IT penetration plan for various industries and public
sector organisations.
• With a high literacy rate, affordable cost, substantial English-speaking population, improved
telecommunication connectivity and favourable climate, Meghalaya is well poised to serve the IT
industry.
• The policy also provides various incentives and concessions for investments in IT sector.
40
Sericulture
industry
• Mulberry, muga and eri cocoons are cultivated in Meghalaya.
• The state produced 295.3 million tonnes of eri, 269.1 million tonnes of muga and 19.9 million tonnes
of mulberry cocoon in 2005-06.
• Sericulture has predominantly remained a cottage industry and the government is taking proactive
steps in training the people, reaching out to the market and providing technical support.
Handloom and handicrafts

• Meghalaya has an established tradition of high-quality weaving, with more than 25,000 households
engaged in handloom weaving.
• There are eight production centres, 32 demonstration-cum-production centres, 10 weaving

training centres and a state-level handloom training institute (Mendipathar, East Garo Hills) in the
state.
• With support from National Institute of Design and National Institute of Fashion Technology,
the handloom industry is being developed by the Meghalaya Government.
41
Minerals and
mining
• Meghalaya has a rich mineral resource of 640 million tonnes of coal, 5,000 million tonnes of limestone,
six million tonnes of fire clay, 90 million tonnes of lithographic clay, 4.5 million tonnes of china clay, 5
million tonnes of phosphate rocks, 0.045 million tonnes of sillimanite, 25 million cubic metres of
granite, and substantial reserves of quartz, feldspar, gypsum and uranium.
• The mining industry has just opened up in Meghalaya; most of the coal and stones are being exported
to Bangladesh.
• A number of cement factories are being either planned or being set up, owing to the rich mineral
content of the state.
Leather and allied industries

• Meghalaya had 39 leather-based industries in 2007-08; the state exported 57 million tonnes of raw
hides in 2006-07 to Bangladesh.
• Though Meghalayans use a lot of leather in their clothes and in domestic applications, tanning and
processing industry is not well developed, providing significant opportunity for the development of
the industry.
42
Major industrial projects being

implemented Investment
Promoter Project Location
(US$
million)
Infrastructure
Uranium Corporation of India Limited Uranium mining and processing 248.8 West Khasi Hills
Meghalaya Energy Corporation Limited Myntdu Leshka hydro-power project 154.7 Jainitia Hills
Meghalaya Energy Corporation Limited Umtru hydel power project 54.1 Ri-Bhoi
National Highways Authority of India Jorbat Shillong road up-gradation 133.3 Shillong
North Eastern Railway Azra-Byrnihat railway 118.8 Byrnihat
Manufacturing
Jai Balaji Shakti Cement Limited Cement project 155.0 Jainitia Hills
Nilanchaal Cement Private Limited Portland cement 113.0 Jainitia Hills
Goldstone Cements Limited Slag cement 97.8 Jainitia Hills
Jai Umadutt Cement Limited Cement project 47.8 East Khasi Hills
Kaziranga Cement Private Limited Cement project 39.6 East Khasi Hills
Source: projectstoday.com
43
Content
s

profile
Meghalaya
44
DOING BUSINESS IN
MEGHALAYA
Key approvals
required
Approvals and clearances required Department
Incorporation of company Registrar of companies

Registration, Industrial Entrepreneurs Memorandum, industrial licenses
Permission for land use Industries Department of Meghalaya
Allotment of land
Site environmental approval
No objection certificate and consent under Water and Meghalaya Pollution Control Board
Pollution Control Act
Registration under States Sales Tax Act and Central and State
Excise Act Excise Department
Commercial taxes
Sanction of power
Power feasibility Meghalaya Energy Corporation Limited
Power connection
Approval for construction activity and building plan Public Works Department
Water and sewerage clearance
Public Health and Engineering Department
Water connection
45
DOING BUSINESS IN
MEGHALAYA
Cost of doing business in

Meghalaya
Cost parameter Cost estimate Source
Cost of land (per acre) US$ 50,000 to US$ 75,000 (Shillong) Property dealers
Hotel costs (per room per night) US$10 to US$ 35 State tourism website
Cost of office space (2,000 sq ft) US$ 75 to US$ 200 per month Property dealers
Cost of residential space

US$ 60 to US$ 100 per month Property dealers
(2,000 sq ft house)
Meghalaya Power Distribution

Power cost (per kWh) Commercial and industrial: US 5.8 cents
Corporation Limited
Unskilled: US$ 2.2 Labour Department, Government of

Labour cost (minimum daily wages)
Skilled: US$ 3.0 Meghalaya
46
DOING BUSINESS IN
MEGHALAYA
Contact
list
Key agency Contact information
Ministry of Development of North Eastern Region 258, 1st Floor, Vigyan Bhavan-Annexe
New Delhi - 110011
Phone: 91-11-2302 2401, 2302 2400
Fax: 91-11-2306 2754
Website: mdoner.gov.in
Industries Department of Meghalaya Director of Industries,
Administrative Building, Lower Lachumiere
Shillong - 793 001
East Khasi Hills District, Meghalaya
E-mail: industries-meg@nic.in
Meghalaya State Electricity Board Meghalaya Energy Corporation Limited
Lum Jingshai, Short Round Road
Shillong – 793001
Meghalaya
Phone: 91-364 2590610/ 2590742/
2590710/ 2591843
Fax: 91-364-2590355
47
DOING BUSINESS IN
MEGHALAYA
Annexur
e Exchange
rates
Year INR equivalent of one US$
2000 46.6
2001 48.3
2002 48.0
2003 45.6
2004 43.7
2005 45.2
2006 45.0
2007 42.0
2008 40.2
2009 46.0
Average rates for the

year
48
DISC LAIMER
India Brand Equity Foundation (“IBEF”) engaged presentation to ensure that the information is accurate
ICRA Management Consulting Services Limited (IMaCS) to the best of IMaCS’s and IBEF’s knowledge and belief,
to prepare this presentation and the same has been the content is not to be construed in any manner
prepared by IMaCS in consultation with IBEF. whatsoever as a substitute for professional advice.
All rights reserved. All copyright in this presentation and IMaCS and IBEF neither recommend nor endorse any
related works is solely and exclusively owned by specific products or services that may have been
IBEF.The same may not be reproduced, wholly or in part mentioned in this presentation and nor do they assume
in any material form (including photocopying or storing any liability or responsibility for the outcome of decisions
it in any medium by electronic means and whether or taken as a result of any reliance placed on this
not transiently or incidentally to some other use of this presentation.
presentation), modified or in any manner communicated
to any third party except with the written approval of Neither IMaCS nor IBEF shall be liable for any direct or
IBEF. indirect damages that may arise due to any act or
omission on the part of the user due to any reliance
This presentation is for information purposes placed or guidance taken from any portion of this
only.While due care has been taken during the presentation.
compilation of this
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MEGHALAYA

Investment climate of a state is determined by a mix of

Resources/Input Regulatory framework

 State economy and socio-economic

 State policies and incentives

 Doing business in Meghalaya

• The state has seven administrative districts.

• Meghalaya is the wettest state in the country

• Meghalaya has diverse soil types including red-

• English is the official language of Meghalaya.

Policy and fiscal incentives

Rich natural resources

Conducive agro-climatic conditions

Tourism destination of the Northeast

Key industries with policy thrust and factor

 State economy and socio-economic

 State policies and incentives

Source: Statistical Handbook, 2008-09

0.00 0.50 1.00 1.50 2.00

0.00 0.50 1.00 1.50 2.00

Meghalaya’s economic performance is driven by the

• Trade, manufacturing, tourism, construction,

• The Industries Department of Meghalaya and its

Rice, potato, pineapple and banana are the key agricultural

Manufacturing Mining Electricity Services

Source: CMIE, as of 2008

 State economy and socio-economic

Roads, railways and

• The nearest railway station is in Guwahati, Assam.

• Meghalaya has two airports located in Umroi

• Helicopter services are available from Guwahati

• The Meghalaya Transport Corporation provides 20

• The per capita power consumption of 187.0

• Meghalaya had 390 post offices as of

High and higher secondary schools 25:1

 State economy and socio-economic

• NEIIPP 2007 has replaced the North East Industrial Policy1997.

• 100 per cent income tax exemption for industrial units.

• Interest subsidy to be given at the rate of 3 per cent on working capital.

• 100 per cent reimbursement of insurance premium.

• The state government to invite private sector in undertaking joint projects.

• Exemption from stamp duty.

• Additional sales tax incentives, limited to the amount of capital subsidy.

• Single-window clearance to be set up in cognizance with the NEIPP 2007.

• Reimbursement of up to 30 per cent of realistic wage of local tribal employees, annually.

• Stamp duty exemption up to 75 per cent on investments above US$ 434,782.

• Exemption from luxury tax for a period of five years.

• Facilitate the establishment of IT enabled service centres in the state.

• To develop the human resource base required for the IT industry.

• Apply IT in governance and management of the state government programmes.

• Earmark up to 5 per cent of the government’s budget for IT-related expenditure.

Incentives and concessions:

 State economy and socio-economic

 State policies and incentives

• Decorative plants such as

Medicinal plants and bamboo

• Around 120 species have been identified for commercial production.

Agriculture, horticulture and food

• The number of foreign tourists has increased by 24

Handloom and handicrafts

• There are eight production centres, 32 demonstration-cum-production centres, 10 weaving

Leather and allied industries

Major industrial projects being