Uttarakhand State Economy Profile

U T TA R A K H A N D
October 2007

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STATE ECONOMY &
SOCIO-ECONOMIC PROFILE

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STAT E E C O N O M Y & S O C I O -ECONOMY PROFILE
UTTARAKHAND • October 2007

Uttarakhand – A Snapshot

• State of Uttarakhand was formed on
9th of November, 2000 as the 27th state of India
• Formed by carving out the 14 hilly districts
of the State of Uttar Pradesh
• Strategically located and forms part of the Northern
boundary of the country sharing borders with
Nepal and Tibet (China); touches Tibet in the North,
Himachal Pradesh in the West and Northwest,
gangetic plains of Uttar Pradesh in the south and
Nepal in the East
• Uttarakhand has diverse geographical features ranging
from snow-capped mountain peaks in the north
to the tropical forests in the south; equally diverse
is its climate and vegetation


Uttarakhand – A Snapshot

• One of the five states in India to be declared
as UNESCO’s World Heritage Biodiversity sites
• Occupies an area of 53,483 sq km and has
a population of 8.5 million
• Administrative and legislative capital is Dehradun


Socio – Economic Snapshot

Capital Dehradun
Area 53,483 sq km
Population (Census 2001) 8.5 million
Density (2001) 158 per sq km
Sex Ratio (Census 2001) 962 females
per 1000 males
Principal Languages Hindi, Garhwali, Kumaoni
Literacy Rate 71.6%
(Census 2001)
Major Minerals Limestone, soapstone
and magnesite
Major Industries Hydropower, floriculture,
horticulture, agro-based
and food processing
industries, information
and communication
technology, biotechnology

Major Crops Rice, Wheat, Barley,
Corn, Mandua, Hangora
GSDP at current prices US$ 5,365.6 million
in 2004-05


Socio – Economic Snapshot

NSDP at current prices US$ 5,060.2 million
in 2004-05
Annual Per Capita Income US$ 595.26
at current prices in
2004-05
Domestic Airports Jolly Grant, Pant Nagar

Source: Uttarakhand State official website
Source: Official website of Ministry of External Affairs, GOI
www.indiainbusiness.nic.in
Source: Indiastat


Economic Profile

• Gross State Domestic product (GSDP) at GSDP (in million US$)
current prices in 2004-2005 (as of Feb 2006) 2004-05 5365.56
was US$ 5,365.6 million
2000-01 2845.81
• Net State Domestic Product (NSDP) of the state
at Current Prices (2004-05) was US$ 5,060.2 million 1996-97 1916.66

• The service sector contributes to more than half of 1993-94 1332.22

the state’s GDP at 51%, followed by the agricultural 0 1000 2000 3000 4000 5000 6000

and mining sector at 24% and the manufacturing Source: Uttarakhand State Government
sector at 25% in 2004-05


Economic Profile

• State is essentially driven by the tertiary sector; Sector Contribution to GSDP (2004-05)
tourism is one of the key sectors with a major
contribution to the state’s economy
25%

• 24% of the GSDP contributed by the primary
sector which includes agriculture, cultivation, 51%

mining activities etc. 24%

n Teritiary Sector n Primary Sector
n Secondary Sector

Source: Uttarakhand State Government


Socio-Economic Profile

• Per capita income grew at a CAGR of Per Capita (In US$)
5.2% per annum between 1993-94 and 2004-05 2004-05 595

• In 2004-05, the per capita income of the state stood 2000-01 338
at US$ 595
1996-97 245
• State’s literacy rate has increased considerably from
57.75% in 1991 to 71.60% in 2001; higher than India’s 1993-94 178

average literacy rate of 65.38% 0 100 200 300 400 500 600 700

• Work Participation Rate (WPR) is 36.93% for Source: Uttarakhand State Government

Uttarakhand and 39.30% for India as per 2001 Census

INFRASTRUCTURE STATUS

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IN F R A S T RU C T U R E S TAT U S

Physical Infrastructure

Railways
• Deployed 345 kms of rail routes by 2005-06
• As on 31 March 2005, density of rail routes
is 6.45 route km for every thousand sq km
• State plans to increase the share of railways
in cargo and passenger transportation
• Efforts being made in conjunction with the Urban
Development Department to establish
‘Mono Rail System’ in Dehradun, Haridwar and
Rishikesh and their inter-city linkage routes



Airways Flight Connectivity Only from Delhi
No. of Airports 2
• State aims at positioning air-transport as a reliable
all-weather transport option in hills
• Upgradation work at the Pantnagar Airport to
facilitate international flights is under progress
• Government has allocated US$ 0.23 million for
construction of at least one helipad per district



Roads Total Road Network 27,509.58 Km
National Highways 1,327.60 Km
• Total length of road in the state in 2005-06 State Highways 1,542.78 Km
was 27,509.58 km.
• 9,419 villages out of a total of 15,656 connected
as on March, 2005
• Public Works Department of the state has planned
several Build–Operate–Transfer projects under Public
Private Partnerships
• US$ 88.75 million was spent on road transport
in 2005-06, 40% higher than the previous
year’s expenditure



Transport Network in Uttarakhand


Physical Infrastructure – Power & Urban

Urban Infrastructure Input 2001 2006 Growth/
Achievement
• Urban infrastructure development became a priority Villages Electrified (Nos.) 12563 14377 1814
sector for the state government since 2005-06 with Hamlets Electrified (Nos.) 703 3368 2665

an allocation of US$ 20.33 million for its activities BPL Connections (Nos.) - 82243 82243
PTW Connections (Nos.) 16667 19107 2440
which was further increased to US$ 58.84 million Consumers (Nos.) 816949 10653 248407
for the year 2006-07 Rural Electrification 79 95.48 95.48
% (incl. UREDA )
• State housing projects have been taken up under AT&C Losses % 45.07 45.07 45.07
various urban infrastructure development projects; Annual Per Capita 413 654 241
275 acre housing project in Haridwar is one of the Consumption (KWh)
Human Capital Workforce (Nos.) 5807 4998
instances of such projects 4998

• With an aid of US$ 15.12 million from the Source: Uttarakhand State Government

Government of India, conservation and rejuvenation
project of Naini Lake and four other lakes in the
surrounding areas has been taken up


Physical Infrastructure – Power & Urban

Power Input 2001 2006 Growth/
Achievement
• Being developed as an ‘energy state’ to tap its huge Villages Electrified (Nos.) 12563 14377 1814
hydro electric power generation potential of Hamlets Electrified (Nos.) 703 3368 2665

20,000 MW BPL Connections (Nos.) - 82243 82243
PTW Connections (Nos.) 16667 19107 2440
• State intends to increase its capacity to 5,000 MW Consumers (Nos.) 816949 10653 248407
of hydro electric power by 2011-12 Rural Electrification 79 95.48 95.48
% (incl. UREDA )
• State has simultaneously supported alternate sources AT&C Losses % 45.07 45.07 45.07
of power generation; solar water heaters with heating Annual Per Capita 413 654 241
Consumption (KWh)
capacity of 97,500 litres per day, 7 biogas-bracketing Human Capital Workforce (Nos.) 5807 4998 4998
plants, 12 solar plants and a state-level energy park
in Dehradun Source: Uttarakhand State Government


Urban Infrastructure

• Concentrated effort to ensure supply of pure drinking Drinking Water Supply Details in Uttarakhand (2005-06)
water; state government is encouraging traditional Inhabited Revenue Villages Covered 15,547
methods of water harvesting like nauley, dharey, chal Population Covered 6.142 million
and khal Scarcity Villages 4
Scarcity Hamlet
• In 2005-06, US$ 76.28 million spent on improvement (i) Not Covered (N.C.) 4,362
of water supply systems; government proposes to (ii) Partially Covered (P.C.) 13,622

spend US$ 86.05 million on further improving the Source: Uttarakhand State Government
water supply in the state during 2006-07


Urban Infrastructure

• Government has undertaken development of total Development under Total Sanitation for Village in Uttrakhand
sanitation systems for villages in the state
Garbage 5,067

• Worked at developing the waste-disposal system Pits 5,823

under “Total Sanitation” campaign Soakpits
2,834
5,330
• Partial sewer arrangements have been provided in
Compost
one-third of the towns in the state. Pits
4,506
7,590
Constructed

Individual
10,316
Toilets
31,549
Constructed

0 5,000 10,000 15,000 20,000 25,000 30,000 35,000

n 2000-01 n 2005-06



Social Infrastructure - Health

State has a good network of hospitals and health State Allopathic Hospitals and Dispensary
centres; created the health and population policy District Level Hospital 14
to improve the quality of life of its people by focusing Base Hospital 3
on developing an effective health infrastructure P.H.C./Additional P.H.C. 224
Community Health Centre 49
Following are some of the objectives laid down State Allopathic Hospitals 322
by the state in its health and population policy: Joint/ Women Hospital 40
Tehsil/ Dist. Level 24
• Eradicate polio by 2007; Post partam Centre
Health Post 9
• Reduce the level of leprosy to below Tuberculosis Hospital/Clinic 18
1 per 10,000 population by December 2007; Leprosy 3
Beds in Govt. Hospitals 7,676



Social Infrastructure - Health

• Reduce mortality on account of tuberculosis, Family Welfare Services
malaria, other vector and water-borne diseases Women and Child Welfare Centres 2
by 50% by 2010; Main Centres 84
Women and Child Welfare 1,631
• Reduce prevalence of blindness from around Sub-Centres
1 to 0.3% by 2010;
• Reduce Iodine Deficiency Disorder (IDD) Other Hospitals
by 50% of the present level by 2010; Homeopathic Hospital/Dispensary 97
Ayurvedic Hospitals 495
• Increase awareness on HIV/AIDS
Unani Hospitals 3



Social Infrastructure - Education

State has to its credit some of the country’s best Basic/ Secondary Education
institutes of higher learning like: Numbers of Schools/ Colleges 20,875
Number of Students 2,142,888
• GB Pant University of Agriculture and Technology
Numbers of Teachers 80,154
in Pantnagar;
• Indian Institute of Technology in Roorkee Higher Education

• Forest Research Institute in Dehradun Number of Institutions 98
Number of Students 119,846
• GB Pant Institute of Himalayan Environment Number of Teachers 1,581
and Development in Almora
• Rural Biotechnology Complex in Kosi and Herbal
Research and Development Institute, Gopeswar


Social Infrastructure - Education

• With a current literacy rate of 71.6%, the state strives Vocational and Technical Education
to achieve 95% literacy rate, for which it has adopted Industrial Training Institutes 104
a three-fold strategy with the following elements: Polytechnics 30
Distant Institute of Education 9
* 100% enrolment and Training

* 100% retention Source: Uttarakhand State Government

* Continuous Education Programme
• State plans to achieve 100% computer literacy
for students by the end of the 10th five-year plan
• For this purpose the state has worked at improving
the IT infrastructure at all levels beginning with
educational institutions


Physical Infrastructure – Telecom & IT

• Well-developed communication network including Communication Infrastructure in Uttarakhand (2005-06)
both wired and wireless connectivity Postal and Communication Services Number of units
Post Offices 2,719
• Establishment of a Software Technology Park of
Number of Telephone Exchanges 453
India Earth Station at Dehradun and proposed Earth Telegraph Offices 163
stations at other locations has positioned Uttarakhand PCOs 14,577
well with respect to providing high speed connectivity. Telephone Connections 404,163
(Including WLL) by BSNL
• Information Technology Department has actively Mobile phone connections by BSNL 283,941
worked in developing two information technology Source: Uttarakhand State Government
parks in the state in 2005-06.


Physical Infrastructure – Telecom & IT

• The Uttarakhand State Wide Area Network Key Highlights
(USWAN) project proposed has been approved
• Development of PKI/Smart Card Infrastructure
by the Government of India.
• World’s first Microsoft IT Academy was established
• By the end of 2006-07, the state aims at having the in Dehradun

required Information Technology infrastructure for • Uttarakhand is among the leading states in
computer education
USWAN and Data Centre in place.


Industrial Infrastructure

• State has transformed an essentially agrarian state
into a hub of industrial activity. During 2005-06, the
state successfully developed the following:
* 3 Integrated Industrial Estates (IIEs) at Haridwar,
* Pantnagar and Sitarganj
* Pharma City at Salequi
* Information Technology Park
at Sahastradhana (Dehradun)
* Growth Center at Siggadi (Kotdwar)



• In 2005-06, Uttarakhand also saw the development
of 20 Private/Joint/Co-operative sector industrial
sectors in Public-Private Partnership mode
• Some of the other efforts made in this direction
include:
* Provision of broadband connectivity for
all industries in the state
* Proposed strengthening of single window –
Contact, Information and Facilitation mechanism
during 2006-07


Industrial estates at a glance

Name of the Estate Location Location Financial Incentives Proposed Industries
Integrated Industrial 3 kms from Delhi-Haridwar 2,034 acres • 100% Central Excise exemption for 10 years • Cosmetics and allied
Estate - Haridwar National Highway
• 100% Income Tax exemption for first 5 years • Plastic and allied
and 30% for next 5 years
• Apparel and allied
• Central Sales Tax @1% for 5 years
• Agro food and allied
• Capital Investment Subsidy @15% with
• Pharma products
a maximum of US$ 73,170
• Electrical, electronics and allied

• Institutional, commercial and allied

Integrated Industrial National Highway number NH-87 3,339 acres • 100% Central Excise exemption for 10 years • Cosmetics and allied
Estate - Pantnagar
• 100% Income Tax exemption for first 5 years • Plastic and allied
and 30% for next 5 years
• Apparel and allied
• CST @1% for 5 years
• Agro Food and allied
• Pharma products
• Electrical, Electronics and allied

• Furniture hub

• Institutional, commercial and allied



Name of the Estate Location Location Financial Incentives Proposed Industries
Integrated Industrial Estate, Sitarganj 15 km north of Sitarganj town 1,200 acres NA NA
Pharma City, Selaqui Industrial 25 Km from Dehradun 50 acres • 100% Central Excise exemption for 10 years • Pharmaceutical formulation
Area, Dehradun industry to be preferred
• 100% Income Tax exemption for first 5 years and 30
% for next 5 years
Sigaddi Growth Centre 120 Km from Dehradun 100 acres • 100% Central Excise exemption for 10 years • Thrust sector industries only

• 100% Income Tax exemption for first 5 years and 30
% for next 5 Years





Name of the Estate Location Location Proposed Facilities
State-of-the-Art Information Sahastradhara road 60 acres • Ready-to-occupy hi-tech intelligent building
Technology Park
• Developed plots of varying sizes
• Academic zone for educational and research organisations
• STPI Incubation center to promote local entrepreneurs
• Large tracts of land have been devoted to green areas and open spaces
• Habitat centre to cater to business support and recreational needs of the occupants
• Other support facilities such as conference hall, training centres, guest house, travel
and forex service, banks and ATMs, multi-cuisine food court, health club with gym,
medical centre, serviced apartments, library and information bureau, indoor and
outdoor sport facilities like squash, tennis, badminton courts, billiards etc.

Source: State Infrastructure & industrial development corporation of Uttarakhand Ltd

STATE POLICIES & INCENTIVES

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STAT E P O L I C I E S & I N C E N T I VES

State Level Policies

New State Industrial Policy 2003
• Aim of the policy is to provide a comprehensive,
investor-friendly environment for rapid and sustainable
industrial development
• Thrust of the policy is on generating additional
employment opportunities and increasing
the State Domestic Product



New State Industrial Policy 2003
• Policy aims at promoting Public Private Partnerships
in development and management of infrastructure
projects such as:
* Industrial Estates and Growth Centers
* IIDCs, Special Economic and Commodity
Zones and Parks
* Theme parks, tourism infrastructure, development
of new tourist destinations, airports/helipads /
airstrips, roads and power projects
• New policy also focuses on promoting small scale,
cottage, khadi and village industries, handicrafts and
handloom sectors



Tourism Policy
The tourism policy of the state aims at:
• Placing Uttarakhand on the tourism map of the world
as one of the leading tourist destinations, and to make
Uttarakhand synonymous with tourism
• Developing the manifold tourism related resources
of the state in an eco-friendly manner, with the active
participation of the private sector and the local host
communities
• Developing tourism as a major source of employment
and income/revenue generation and as a pivot of the
economic and social development in the state



Information Technoloy Policy
• Encourage the use of Information Technology in the
Government not only as a tool for management and
decision support systems but also to re-engineer
the processes of the Government to provide a more
efficient, transparent, accountable and responsive
government to its citizens
• Upgrade the quality of life of citizens of the State by
facilitating easy access to consumer applications of
Information Technology
• Encourage private sector initiatives for the
development of world class Information Technology
infrastructure adequate for the needs of the citizens,
the industry and the Government.



• Upgrade and develop manpower skills required for
the Information Technology industry and to accelerate
the use of Information Technology in schools, colleges
and other educational institutions with a view to
providing skills and knowledge to the youth so as to
render them fit for employment in this industry
• Use Information Technology as a GDP driver by
promoting IT industry in the state, developing the
state as an attractive IT destination with a view to
generate employment for youth in this sector and
raising their earning capacity and simultaneously
realizing the export as well as domestic revenue
potential in this sector


State Level Incentives

Category Details of State level incentives for industries
Capital Investment Subsidy • 15% central capital investment aid up to a maximum of US$ 73,170 for the establishment of new industrial units and for the purchase
of equipment and machinery for significant improvement in existing units.
Interest Subsidy • 3% annual relief on loans to new SSI units and SSI units expanding at least 25% provided the loan is availed from state level financial institutions
or banks operating in Uttarakhand and have not defaulted in principal or interest payments.

• 5% waiver on annual interests on loans on SSI units and units notified as thrust industries being set up in remote areas.

Land Subsidy • Stamp duty concessions to be provided in respect of land in specialized commodity parks, including IT parks.
Registration of patents • 75% of the cost (subject to a maximum of US$ 4,878) for registering patents shall be reimbursed
and other IPR
Power Subsidy No restriction in the state in using power during the peak hours
Others Concessions • A 100% relief in the State Excise Duty for a period of ten years

• A 100% relief in Income Tax for the first five years, and thereafter a 30% relief to companies and 25% relief for others

• CST @ 1% for 5 years

• Exemption from entry tax on plant and machinery for setting up industry, undertaking substantial expansion and modernisation

• 100% exemption on entertainment tax for Multiplex projects for a period of 3 years

• 100% exemption on entertainment tax on Amusement parks and Ropeways for a period of 5 years

• 75% of the total expenditure incurred in obtaining national/international quality marks to be reimbursed

• 50% of the cost incurred in installing pollution control equipments to be reimbursed

• Matching State subsidy on approved projects of National Horticulture Board (NHB), Agricultural and Processed Food Products Export
Development Authority (APEDA), National Medicinal Plant Board (NMPB)

Source: Government of Uttarakhand


Thrust Industries

Thrust Industries
• Floriculture • Sports goods and articles
• Equipment for general physical exercise
• Equipment for adventure sports/activities, tourism (to be separately specified)
• Processing of medicinal and aromatic herbs • Paper and paper products excluding those in negative list (as per excise classification)
• Honey • Pharma products
• Horticulture and agro based industries such as • Information and communication technology industry
• Sauces, ketchup, etc. • Computer hardware
• Fruit juices and fruit pulp • Business process outsourcing
• Jams, jellies, vegetable juices, puree, pickles etc.
• Preserved fruits and vegetables
• Processing of fresh fruits and vegetables including packaging
• Processing, preservation, packaging of mushrooms

• Food processing industry excluding those included in the negative list • Bottling of mineral water
• Sugar and its by-products • Eco-tourism
• Hotels, Resorts, Spa, Entertainment/Amusement parks and Ropeways
• Silk and silk products • Industrial gases (based on atmospheric fraction)
• Wool and woolen products • Handicrafts
• Woven fabrics (Excisable garments) • Non-timber forest product based industries

Source: Uttara Portal

BUSINESS OPPORTUNITIES

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BU S I N E S S O P P O RT U N I T I E S

Attractive Sectors

Tourism Sector Specific Incentives

• Tourism is an important sector for the Category Benefit Period
(years)
state’s economy
New Rebate/deferment 5
• Uttarakhand is already a well-renowned pilgrim tourism units facility in respect
of luxury tax
destination from the date of
commencement
• During 2005, the state registered a growth of about New ropeways Exemption from 5
18% in domestic and 24% in international tourist payment of
entertainment tax
arrivals over the previous year from the date
of commencement
New amusement Exemption from 5
parks entertainment
tax from the date
of becoming fully
operational


Attractive Sectors

Tourism
• Investment opportunities that exist in the tourism
sector include:
* Development of facilities for providing Spiritual
lessons, Reiki, and other rejuvenating courses
* Eco-tourism hotels, Spa, Resorts, Amusement
parks and Ropeways
* Winter sports at places such as Auly, which have
the requisite terrain for the purpose
* Adventure tourism


Attractive Sectors

Agro and Food Processing
• High bio-diversity makes the state an attractive
destination for Agro and Food Processing Industries
• State offers immense opportunities for establishing
agro and food parks
• Higher incentives being offered by MFPI for setting
up units in Uttarakhand
• State government is also providing various subsidies
for projects under APEDA, NHB, MFPI and NMPB


Attractive Sectors

Floriculture and Horticulture
• Demand in domestic and international market has
shifted the Government’s focus to floriculture and
horticulture
• Geographical location makes the state particularly
conducive to commercial horticulture and floriculture
• Immense opportunities for floriculture and
horticulture parks in the state


Attractive Sectors

Biotechnology
• Rare species of plants and animals found in the state
add to its natural advantage in this sector
• Government plans to develop Uttarakhand as a centre
of excellence in biotechnology
• Government proposes to grant industry status
to units coming up in the sector; provisions made for
the IT sector shall be applicable to this sector as well


Attractive Sectors

IT and Communication
• IT and ITeS have been accorded industry status
• Uttarakhand offers high-speed connectivity via an STPI
earth station at Dehradun
• Emerging as an ideal IT destination with an IT Park
in Dehradun, an IT-BT Park in Pantnagar, and several
other up-coming projects thereby offering immense
opportunities in the sector
Hydro power
• Untapped potential for generating hydropower
• State aims to position itself as the most competitive
supplier to the Northern Grid
• State has a potential to generate nearly 15,000 MW
of hydropower and 47 locations have already been
identified for private sector


Attractive Sectors

Forest Products
• Excellent potential for the development of forest
resources-based industries
• Ample scope to develop industries based on forest
and agro wastes such as lantana, pine needles and
plant and vegetative fibers
• State also offers immense opportunities for medicinal,
aromatic plant and herbal export oriented units


Emerging Opportunities

Other Attractive Sectors
Sericulture
Sector has the prospect of emerging as a major sector
in the years to come. Muga cocoon produced in the
state is comparable to the best quality available in India
Fisheries
With Uttarakhand’s large water resources,
the possibility of developing fisheries is immense.
The Fisheries Policy declared in 2002 is devised
aiming at integrated development of fisheries and
use of scientific techniques


Emerging Opportunities

Other Attractive Sectors
Tea
Uttarakhand has emerged as the only state outside
the traditional tea growing areas to produce Organic
Orthodox Tea. It is also proposed to bring in additional
acreage under tea plantation over the next few years.
Bamboo and Fibre Developments
State Government has established a Bamboo
and Fibre Development Board to develop this sector.


Investments in Uttarakhand
Industrial Investment Inflow Share of Uttarakhand in Total Industrial Investment proposals
1.6 1.43
Period Total Proposed Proposed
proposals Investment Employment 1.4

(US$ million) (Numbers) 1.2
1.0
0.87

Percentage
IEM + IEM + % IEM + IEM + 1

LOI LOI Share LOI LOI 0.8 0.64 0.64 0.67

Mar-01 292 292 0.5 52,888 0.70 0.6

Mar-02 314 1,634 0.55 56,187 0.65 0.4

Mar-03 348 1,764 0.56 61,419 0.68 0.2

Mar-04* 490 2,087 0.59 76,422 0.69
0 Mar’01 Mar’02 Mar’03 Mar’04 Nov’04 Dec’05
Nov-04 596 2,561 0.65 90,188 0.77
Dec-05 950 14,989 0.79 152,170 1.27
Source: Department of Industrial Policy and Promotion
Ministry of Commerce and Industry
*Investment Proposals since March 2004 also include DILs


Investments in Uttarakhand
Year-wise Distribution of IEMS Filed in Uttarakhand till 31.12.2005

Year Numbers Proposed
Investment
(US$ million)
Aug 1991 265 1,173.72
to Dec 2000
2001 21 128.60
2002 19 73.02
2003 110 220.00
2004 116 619.30
2005 2005 1,211.39

Source: Department of Industrial Policy and Promotion
Ministry of Commerce and Industry


Upcoming Investments

Sector Expected Major Investors Investment envisaged in Uttrakhand (In US$ million)
Investment
34.88
60.77
46.51
Automotive US$ Tata Motors, Hero Honda, 174.42
1767.44 million Ashok Leyland, M&M,
Bajaj Auto. 34.88

Pharmaceuticals US$ Ranbaxy, Natco, Pegasus,
174.42 million Chris Pharma, Intas Labs,
Martin and Harris Lab

Processed Foods US$ Parle, Britannia, Nestle,
60.77 million Dabur, Raja Biscuits 1,767.44

Footwear US$ 46.51 million Action, Lakhani, and Liberty
FMCG US$ 34.88 million Hindustan Lever Ltd, n Automotive n Pharmaceuticals
CavinKare, Cosmos, Lotus, n Processed Foods n Footwear
and Herbal Concept n FMCG n Information Technology
Information US$ 34.88 million HP (Hewlett-Packard)
Technology and HCL Infosystems


Key Investors

Name of Location Products Project Cost in US$ million
Company

ITC Limited IIE, Haridwar Food and personal 29.12
care products
Britannia IIE, Pantnagar Biscuits and other 13.34
Industries Ltd food products
Dabur India Ltd IIE, Pantnagar Health care, personal care, 11.44
ayurvedic cosmetics
Cavinkare IIE, Haridwar Cosmetic, shampoos/creams, 6.05
Pvt. Ltd deodorants
Twenty First IIE, Haridwar Printed packaging material, 5.83
Century cartons, boxes, shells and
Printers Ltd labels
Somany IIE, Haridwar Polyurethane foam 5.99
Foam Limited mattress, FT foam sheets
Polar IIE, Haridwar Electrical fans, water lifting 4.99
Industries Ltd pumps, geysers, water
purifiers and laminations
Havell’s India Ltd IIE, Haridwar Electrical products 3.96
VIP Industries IIE, Haridwar Plastic moulded luggage 3.95
Ltd
Lakhani India Ltd IIE, Haridwar Footwear and parts 3.70


Key Investors

ITC
• One of India’s foremost private sector companies
with a market capitalisation of nearly US$ 15 billion
and a turnover of over US$ 4.75 billion
• Established manufacturing facility in Uttarakhand
for producing soaps and shampoos
Hiltron
• Independent corporation that initially worked to
promote development of electronics and allied
industries and services in Uttarakhand
• Currently functioning as an IT and Communication
service provider to the state under administrative
control of department of IT


Key Investors

Tata Motors
• Tata Motors, one of the leading firms in the country
in the automobile sector has set up its fourth plant in
Uttarakhand
• This plant in Pantnagar has been set-up for
manufacturing the firm’s mini truck named Ace
Hero Honda
• One of the leading brands in India for two wheelers
• Established a new manufacturing plant in Haridwar
• Plant is intended to have a capacity of 500,000 units


Key Investors

Ashok Leyland
• Started work for a state-of-the-art, integrated
manufacturing plant near Pantnagar in Uttarakhand
• Planning to invest US$ 232.56 million to create
assembly and cab facilities for 25,000 vehicles annually
in the first phase
• Scheduled to go on stream in 2008-09.
Phase II is expected to be operational by 2010
Mahindra & Mahindra
• Mahindra & Mahindra Limited (M&M) is a major
automaker in India.
• The new plant of the company in Uttarakhand
is the company’s fifth full-scale automotive plant
and has been set up primarily for the manufacture of
three-wheelers of different load capacities and range


Key Investors

Hindustan Lever
• HLL is India’s largest fast moving consumer goods
company
• Hindustan Lever Limited’s (HLL) state-of-the-art
personal care factory, set up with an initial investment
of US$ 30.23 million in SIDCUL’s IIE in Haridwar
HCL Infosystems
• One of the largest vertically integrated IT
manufacturing company of India
• Launched its manufacturing facility at Rudrapur,
Uttarakhand in the SIDCUL Industrial Estate.
• Overall capacity of HCL to 2 million personal
computers per annum


Key Investors

Nestle India Ltd
• Nestle is the world’s largest and most diversified food
company
• Around 2,50,000 employees worldwide, 500 factories
in approximately 100 countries and offers over 8,000
products universally
• Nestlé India has commissioned in 2006, its 7th factory
at Pant Nagar in Uttarakhand


Key Investors

Britannia
• Britannia is one of India’s food products company,
with an estimated 38% market share
• Company’s principal activity is the manufacture and
sale of biscuits, bread, cakes and dairy products like
cheese, butter and milk
• Established a plant in the Integrated Industrial
Estate at Pantnagar

DOING BUSINESS

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DO I N G B U S I N E S S

Key Approvals Required

List of Approvals Departments to be Consulted
and Clearances Required

Prior to setting up the unit
Registration Industries Department
Allotment of Land/Shed Uttarakhand Industrial Development
Department Ltd./UttarPradesh State Industrial
Development Department Ltd./ Industry
Division, Uttarakhand
Power load approval Uttarakhand State Electricity Department
for construction load
Approval for Construction of Building Labor Department
Activity under Factories Act
No Objection Certificate Department of Fire
Provisional Trade Tax Registrations Central and State Excise Departments
Registration under Central Sales Central and State Excise Departments
Tax Act
Before Commencement of Production
Environmental clearances Uttarakhand Environment Protection
and Pollution Control Board
No Objection Certificate Department of Fire
Permanent Trade Tax Registration Permanent Trade Tax Registration
Registration under Central Sales Central and State Excise Departments
Tax Act 1956


Cost of Doing Business

S. No. Sector Cost

1 Manufacturing
a Land Price 22 – 37
(US$/sq mt)*
b Labor (US$/man year) 552 – 846
2 Industrial Electricity (US cents/unit)
a Normal Hours 4.6
b Peak Hours 5.8
c Non-Peak Hours 4.4
3 Prime Lending Rate (%) 12.75% - 13.25%
4 Hotel Stay (US$/night)
a 2 Star 37 – 49
b 3 Star 49 – 73


Business Climate

Abundance of Natural Resources Expanding Industrial Infrastructure

• Abundance of natural resources The state has seen considerable overall development
as a result of the policies of the State Government.
• Presence of many water bodies make it ideal
for hydro power generation
• Ample irrigation, favourable geographical and climatic
conditions make it ideal for Agro based industries
Location Advantage
• Proximity to NCR makes it one of the nation’s leading
market accessible from Uttarakhand
• Also, the state has excellent connectivity to all its
neighboring states


Business Climate

Favorable Policies and Incentives
• Large benefits offered by state in terms of tax
exemptions, reimbursements on loans, interest
incentives, financial assistance, subsidies and
concessions
High Literacy Rates
• State’s literacy average is above the national level
• Abundant pool of talented human resources
as Uttarakhand is host to some of the leading
educational institutions in the country
Proactive Government
• Government is reputed for its efficiency which is very
well reflected in the policies brought out by the state
that addresses current issues in the administration

OVERALL STATE COMPETITIVENESS

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OV E R A L L S TAT E C O M P E T I T I VENESS

Advantage Uttarakhand

• Proactive State Government and efficient
administrative system
• Wide range of fiscal and non-fiscal incentives
• Excellent connectivity internally and to the National
Capital Region (“NCR”) and continual development
of good transportation infrastructure
• Wide-spread opportunities in sectors like floriculture
and horticulture
• Presence of rare medicinal herbs, with over
175 species found in the state is an added advantage
for the success of agro-based industries
• Rich mineral deposits of limestone, soapstone
and magnesite among other minerals providing
opportunities in the mining sector


Advantage Uttarakhand

• Quality education infrastructure coupled with
presence of premier institutes like Indian Institute
of Technology in the district of Roorkee
• Huge potential for hydropower generation as a result
of vast water resources
• Unmatched tourism potential for leisure, adventure,
and religious tourism
• Peaceful and secure industrial environment
• Established industrial estates like Pantnagar, Dehradun,
Haridwar, Selaqui and Sitarganj with all necessary
infrastructure facilities
• Presence of key industrial players like Tata Motors,
Mahindra & Mahindra, Ashok Leyland, Hero Honda,
Hindustan Lever, and HCL Info Systems
Source: Uttarakhand State official website
Official website of Ministry of External Affairs, GOI,
www.indiainbusiness.nic.in, Indiastat


Overall State Competitiveness

Parameter Uttarakhand

Opportunities in Type of Industry

Tourism

IT Based Industries

Tea Based Industries

Food Processing Industry

Pharmaceuticals and bio-tech

Agro Based Industry

High Medium Low




Opportunities in Type of Industry

Forest Based Industry

Mineral Based Industry

Engineering Industry

Chemicals Industry

Handloom and Handicrafts Sector

High Medium Low




Policy Incentives

Setting up and Carrying out Business

Industrial Infrastructure Existing and Proposed

Power

Transportation

Industrial Estates/Areas

STP

High Medium Low




Industrial Infrastructure Existing and Proposed

EPIP

EPZ

High Medium Low


DISCLAIMER

This presentation has been prepared jointly by the Author’s and IBEF’s knowledge and belief, the content is not
India Brand Equity Foundation (“IBEF”) and Ernst & Young to be construed in any manner whatsoever as a substitute for
Pvt. Ltd. (“Authors”). professional advice.
All rights reserved. All copyright in this presentation and related The Author and IBEF neither recommend or endorse any
works is owned by IBEF and the Authors. The same may not be specific products or services that may have been mentioned
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other use of this presentation), modified or in any manner
Neither the Author nor IBEF shall be liable for any direct or
communicated to any third party except with the written
indirect damages that may arise due to any act or omission
approval of IBEF.
on the part of the user due to any reliance placed or guidance
This presentation is for information purposes only. While due taken from any portion of this presentation.
care has been taken during the compilation of this presentation
to ensure that the information is accurate to the best of the

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Uttarakhand State Economy Profile

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