Gujarat Industries Vision-2010 Issues and Concern
India - the country of happenings - has dramatically opened her windows of opportunity in trade and business. The country has achieved a record increase of industrial production index after a decade. Consumers are powering the Indian Economy more and more. Everyday the country sells over 1.0 lakh air tickets, 2,500 cars, 35,000 two-wheelers, 10,000 fridges, 35,000 TVs and 57.6 lakh packaged water. As per the world’s largest Investment Bank, Goldman Sachs’s global research (BRIC Report) released in October 2006, productivity growth will help India sustain over 8% growth until 2020 and make it the second largest economy in the world, ahead of US and next to China by 2050. Reports also say that India’s growth acceleration since 2003 represented a structural increase rather than simply a cyclical upturn.
Gujarat with Industrial Park and SEZ led growth
SMEs are the backbone of the overall economic and industrial growth of the state. Over 90% industrial activities are still in decentralised and unorganised sectors. Even many large sectors are dependent on SMEs for out sourcing of their various activities. However, many cases their growth and sustainability are facing constraints due to emerged environmental issue and lack of other common infrastructures. To overcome such constraints and to become competitive internationally, Industrial Park with world-class infrastructure is being set up for each industrial cluster in the state. Similarly, Industrial Park with SEZ will attract medium and large size export oriented unit to set up their activities in Gujarat. There are over 33 SEZ and another 8 to 10 Industrial Parks are either proposed or in the process of implementing in the next coming years in Gujarat. This will, in turn, create significant industrial growth in the state.
Establishing and updating Industrial databank
In the fast changing economy, updated Industrial database and information supported by Government or Industry Association or by both have become a prime requisite for the Policy Makers and Investors in understanding new product, technology, business and establishing new market and opportunities as an on-going process.
Focus on Value addition and to create complete value chain in each sector
One of the major objectives of industrialisation is to identify various resources and their possible utilisation to arrive more and more value addition. This will create the industries self reliant and competitive, creating a complete value chain in each sector separately e.g. Gujarat is the largest producer of cotton. But hardly 20% of cotton, so produced, could be utilised for further value addition due to insufficiency of spinning activities. Similarly, over 60% fabrics, so produced in Gujarat, goes to other parts of the country for Garmenting. Approach, therefore, will be to promote upstream and down stream project for value addition and to become competitive.
Understanding Locational Advantage
While Government Policy always envisages for balanced growth, each and every location need to be studied separately, in terms of available resources, thereby, new opportunities for investment. In turn, this information will help the Policy Makers and Investors to understand available resources and to work out for the locational advantage for a specific Project and new opportunities for investment.
More Focus on employment generation
Based on available resources Employment intensive activities needs to be identified as a focus sector like Agro & Food Processing, Garmenting and Service sector, which could be promoted even in the rural areas.
Sector specific Industrial Policy by Union and State Government.
Implication of various Policy measures, already taken both by Government of India and State Government need to be assessed time to time for necessary implication for their project ideas and implementation.
HRD Development
On going technological innovation and market trend have forced Industries continuously to update and upgrade technical skill for the existing manpower and for future requirement. Therefore, there is a need to upgrade all the ITIs as per need (Each ITI should have at least one specialised area and Trade). Training Institutes in Private Sector also is to be encouraged in all the potential trade, in the similar line of Apparel training Institute Scheme by I&M Department, Government of Gujarat in the recent past.
Environment friendly and energy efficient product and technology
Encouragement should be more on environment friendly and energy efficient product and technology e.g. Application of Plasma and Biotechnology in various Industrial product and process can save Water, Energy and Environment, substantially.
Encouragement for Trading and Service sector
Trading is the backbone of many industrial segments in Gujarat e.g. Surat Textile industry and its growth is much more dependent on Trading Community. There were only 10-15 Textile market in Surat a 15 years back, which has now reached to 200 markets as of now.
Suggestion, therefore, is to create Trade, Business and Exhibition centre in all Cities and Town, with a focus of SMEs and Industrial cluster of that specific area e.g. South Gujarat Chamber of Commerce and Industries under support of Union and State Government is coming up with a large Exhibition Centre in Surat.
Service sector is one of the growing segments with significant contribution in overall GDP. Evolving a specific policy, Service Industries, specially, in Small and Tiny Sectors, should be focussed even in rural area.
R&D as a Business
As per Department of Science and Technology, Government of India, over 72% of our imports are due to import of technology intensive products and services.
Gujarat Industrial Policy-2003 has already addressed for R&D activities extending a financial support of 50% for such activities. But out of about 60 International R&D players established in the country since the year 1992 the state could not attract international R&D players in the state. Gujarat is a leading Industrial developed state in the country. On the other hand, State is having over 76 R&D/Testing Institutes with a different field of specialisation. Most of the international R&D players entered in India are in the field of IT & Biotech and settled at Hyderabad & Banglore followed by Mumbai, Pune & Kolkatta.
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