An Overview of Industrial Development in Rajasthan Easy access to largest consumer markets, Rajasthan touches six major states of the Northern, Western and Central India. It is a natural corridor between the wealthy Northern and the prosperous Western states of the country, which makes and important trade and commerce centre. In terms of employment, the business and economy of Rajasthan is predominantly pastoral and agricultural. Business and economy of Rajasthan include agriculture, industries, mining and tourism as well. Since 1950, Rajasthan has been the lucrative hub of industrialization. Illustrious Business Communities like the Singhanias, the Birlas and the Shrirams established large scale business enterprises in the state of Rajasthan. Thus Singhania's JK Synthetics and Shriram's Company- Shriram Rayons came up in the year 1962 and 1965 respectively. National Engineering Industries and the Chambal Fertilizers which belong to the Birla group of Companies was set up in 1950. At present almost all prominent Business masters like the Modis, Bangurs, Poddars Thapars, Goenkas, and Rankas have established their industrial units in the gigantic state of Rajasthan. Over the years 212 industrial regions have developed embracing about 42,000 acres of land. Industrial Parks with the added advantage of modern infrastructure system like telecommunications, electricity, water, etc have also come up. The Major Industrial estates of Rajasthan are Shahajahanpur, Khushkhera, Neemrana, Behror, Jurhera in Bharatpur. The Bhiwadi Industrial Development Authority, the industrial township was set up by RIICO recently in Rajasthan. Other industrial sites include Udaipur, Abu Road, Banswara in South Rajasthan. All these areas are related to mineral based projects. The industrial regions of Malviya Nagar, Sitapura and Vishwakarma in Jaipur boast of superior social infrastructure and Sitapura houses the Export Promotion Industrial Park. Steel and Textile Industries are located in the Jodhpur and Bhilwara regions respectively. The state capital Jaipur has 19 industrial estates and Kota has 14 industrial estates. These areas have rich deposits of sandstone and limestone. RIICO along with the State Government has developed several Growth Centers as Sirohi, Jhalawar, Sikar (Palsana), Bikaner (Kahara and Karnal), Dholpur, Naguar and Bhilwara. The main Industrial areas developed are: Bhiwandi, Industrial Area, Neemrana, Khushkhera, Chopanki, Sarekhurd, Sotanala, Shahjahanpur, Behror. Rajasthan offers 277
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An Overview of Industrial Development in Rajasthan
Easy access to largest consumer markets, Rajasthan touches six major states of the
Northern, Western and Central India. It is a natural corridor between the wealthy Northern
and the prosperous Western states of the country, which makes and important trade and
commerce centre. In terms of employment, the business and economy of Rajasthan is
predominantly pastoral and agricultural. Business and economy of Rajasthan include
agriculture, industries, mining and tourism as well.
Since 1950, Rajasthan has been the lucrative hub of industrialization. Illustrious Business
Communities like the Singhanias, the Birlas and the Shrirams established large scale
business enterprises in the state of Rajasthan. Thus Singhania's JK Synthetics and Shriram's
Company- Shriram Rayons came up in the year 1962 and 1965 respectively. National
Engineering Industries and the Chambal Fertilizers which belong to the Birla group of
Companies was set up in 1950. At present almost all prominent Business masters like the
Modis, Bangurs, Poddars Thapars, Goenkas, and Rankas have established their industrial
units in the gigantic state of Rajasthan. Over the years 212 industrial regions have
developed embracing about 42,000 acres of land. Industrial Parks with the added advantage
of modern infrastructure system like telecommunications, electricity, water, etc have also
come up.
The Major Industrial estates of Rajasthan are Shahajahanpur, Khushkhera, Neemrana,
Behror, Jurhera in Bharatpur. The Bhiwadi Industrial Development Authority, the industrial
township was set up by RIICO recently in Rajasthan. Other industrial sites include Udaipur,
Abu Road, Banswara in South Rajasthan. All these areas are related to mineral based
projects. The industrial regions of Malviya Nagar, Sitapura and Vishwakarma in Jaipur
boast of superior social infrastructure and Sitapura houses the Export Promotion Industrial
Park. Steel and Textile Industries are located in the Jodhpur and Bhilwara regions
respectively. The state capital Jaipur has 19 industrial estates and Kota has 14 industrial
estates. These areas have rich deposits of sandstone and limestone.
RIICO along with the State Government has developed several Growth Centers as Sirohi,
Jhalawar, Sikar (Palsana), Bikaner (Kahara and Karnal), Dholpur, Naguar and Bhilwara.
The main Industrial areas developed are: Bhiwandi, Industrial Area, Neemrana,
Ye a r C urre nt P ric e s C o ns ta nt(19 9 9 -2 0 0 0 )P ric e s
P C I ( La kh R s . ) V a rit io n ( P e rc e nt ) P C I ( La kh R s . ) V a rit io n ( P e rc e nt )
1999-2000 13 6 19 13 6 19
2000-01 13 0 2 0 -4.4 12 8 4 0 -5.72
2001-02 14 0 9 8 8.28 13 9 3 3 8.51
2002-03 13 12 8 -6.88 12 0 5 4 -13.49
2003-04 16 5 0 7 2 5 .7 3 15 5 7 9 29.24
2004-05 16 8 7 4 2.23 14 9 0 8 -4.31
2005-06 18 0 0 8 6.72 15 7 3 6 5 .5 6
2006-07 2 12 0 3 17.74 17 4 8 0 11.08
2007-08 P 2 3 9 8 6 13.13 18 7 6 9 7.37
2008-09 Q 2 7 0 0 1 12.57 19 7 0 8 5
2009-10 A 2 8 8 8 5 6.98 19 8 0 6 0.5
P: Provisional, Q: Quick, A: Advance
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2.1.1 Rajasthan’s GSDP
According to Indian Brand Equity Foundation (IBEF) Rajasthan, at current prices, the Gross
State Domestic Product (GSDP) of Rajasthan was about US$ 46.4 billion in 2009-2010.
The cumulative average annual GSDP growth rate, from 1999-2000 to 2009-2010 has been
around 10.1 percent.
Rajasthan GSDP(Figure-1)
Source-IBEF
2.1.2 Rajasthan’s NSDP
According to Indian Brand Equity Foundation (IBEF) Rajasthan, at current prices, the Net
State Domestic Product (NSDP) of Rajasthan was about US$ 40.4 billion in 2009-2010.
The cumulative average annual NSDP growth rate between 1999-2000 and 2009-2010 was
about 9.8 %.
Rajasthan NSDP(Figure-2)
Source -IBEF
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2.1.3 Percentage distribution of GSDP
The tertiary sector has an increasing share in Rajasthan’ Economy. In 2009-2010, the tertiary
sector contributed 45.2% to the state’s GSDP at current prices, followed by secondary sector
(30.0%). The share of the secondary sector in GSDP was driven by manufacturing that registered a
growth of 9.7 % between 1999-2000 and 2009-2010. The share of the primary sector in GSDP was
24.7 % in 2009-2010 vis-à-vis 32.0 % in 1999-2000, agriculture contributing
Percentage distribution of GSDP(Figure-3)
42.2
25.8
32.0
45.2
30.0
24.7
CAGAR
11.0 %
11.9 %
7.5 %
1999-2000 2009-2010
Tertiary sector
Secondary sector
Primary sector
2.1.4 Rajasthan’s per capita GSDP
In 2009-2010, Rajasthan’s per capita GSDP at current prices was US$ 699.2. The per capita
GSDP at current prices increased at a CAGR of 7.9 % from 1999-00 to 2009-10
Rajasthan’s Per capita GSDP in US $(Figure-4)
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2.2 Industries in Rajasthan.
The natural resources, policy incentives and infrastructure in
the state are favourably suited for investments in sectors such
as cement, IT and ITeS, ceramics, tourism, automotive and
agro-based industries.
Bureau of Investment Promotion (BIP) and Rajasthan
Industrial Development and Investment Corporation (RIICO)
are responsible for promoting investments and developing
industrial infrastructure in the state.
The Government of Rajasthan is promoting development of
several SEZs across the state for sectors such as gems and
jewellery, handicrafts, IT, electronics and textiles.
2.3 Rajasthan’s exports trends
Rajasthan’s exports increased at a CAGR of about 19.5 % between 2001-02 and 2008-2009.
The state’s major exports include textiles, handloom, handicrafts, gems and jewellery,
minerals and auto components. In order to boost exports from Rajasthan, the State
Government is laying emphasis on developing export promotion industrial parks (EPIP).
“ExpocityJaipur”, which serves as an international habitat and convention centre, has been
developed by JaipurTrade Expo Centre Private Limited. It is spread over an area of 26,400
sq m and houses multi-utility homes, state-of-the-art business centres,(Figure-5)
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Key industries in Rajasthan
•Cement
•Auto and auto-components
•IT and ITeS
•Ceramics
•Mining
•Tourism
•Textile
•Agro-based industry
•Gems and jewellery
•Marble
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2.4 Industrial infrastructure at a Glance
Infrastructure Primary industry Details
Theme parks
Multi-industry
RIICO is developing theme parks with a special set of infrastructure and facilities for establishing industries in line with the designated theme. It has established a satellite earth station in the Sitapura IT park of Jaipur along with the Software Technology Parks of India (STPI).
Export promotion industrial parks (EPIP)
Multi-product
EPIPs have been set up at Sitapura (Jaipur), Neemrana (Alwar) and Boranada (Jodhpur). The EPIP in Jaipur is among the largest export parks in Northern India. The units operating here have export orders accounting for, at least, 33 % of their total turnover.
SEZs
Multi-product
The state is developing SEZs for industrial growth; as of July 2010, formal approval had been given to eight SEZs, in-principle approval had been given to 11 SEZs and there were seven notified SEZs. A multi-product SEZ is being developed by Mahindra World City (Jaipur) Limited, a joint venture of Mahindra Gesco Limited and RIICO Limited. This public private partnership initiative envisages an investment of about US$ 241.1 million
SEZ for IT
IT
A state-of-the-art special economic zone has been developed by Mahindra and Mahindra with an investment of US$ 244 million. It has attracted many domestic investors such as Infosys and Wipro as well as substantial investment from foreign investors.
Inland Container Depot (ICD)
Logistics
For ease of movement of cargo, ICDs have been set up at Jaipur, Jodhpur, Bhiwadi and Bhilwara.
Spices park
Food processing
A spices park is proposed to be set up at Ramganj Mandi for processing, packaging and export of spices (especially coriander) from Rajasthan. The park will be set up in an area of 30 acres at a total cost of around US$ 3 million
Footwear Design & and Development Institute (FDDI)
Footwear
A FDDI is proposed to be set up at Jodhpur at an estimated cost of around US$ 22 million. This
Institute will provide specialised training in footwear
technology and design.
Skill development
centre
ITES
A skill development centre will be set up by the Confederation of Indian Industry (CII) in conjunction with the State Government to provide skills training for the unemployed youth of Rajasthan. The location will be decided by the State Government in conjunction with CII. Alwar and Jaipur are two of the locations being considered.
Industrial infrastructure up- gradation centre
An industrial infrastructure up-gradation centre will be set up, possibly along the Delhi-Mumbai Industrial Corridor (DMIC). A detailed project report and the exact location is being finalised by the State Government.
2.5 SEZs and industrial clusters (Figure-6)
Index
Cement grade limestone
Automotive
Tourism
IT & ITeS
Handicrafts ,gems &
jewellery
Chemicals
Employment in Rajasthan
Small scale industry forms the backbone of industri
in Rajasthan. In fact, the small scale industry gen
medium counterparts Over 70
dominated by small scale industries: Jaipur, Bhilwa
39%, 18%, 9% and 4% of the State’s industrial outpu
driving industrial growth are Ajmer, Alwar, Barmer, Bharatpur, Bhilwara,
Chittorgarh, Jaipur, Jodhpur, Kota and Udaipur.
2.6 Industry Scenario in Rajasthan
To revive industrial growth in Rajasthan, the State
mechanism for attracting investment; the Bureau of
State Industrial Development and Investment Corpora
Corporation (RFC), and Project Development Corporat
Government has also put in place investor friendly
Healthcare Policy, the Hotel Policy, the Power Poli
and the Biotech Scheme.
Also, a three-tier Single Window Clearance mechanism exists to ex
of industrial projects: the Board of Infrastructure
the Chairmanship of the Chief Mini
Empowered Committee (SLEC) under the Chairmanship o
by the District Level Empowered Committee under the
Commissioner.
Small scale industry forms the backbone of industrial activity and employment generation
in Rajasthan. In fact, the small scale industry generates more employment than its large and
medium counterparts Over 70 % of Rajasthan’s industrial output comes from four re
dominated by small scale industries: Jaipur, Bhilwara, Udaipur and Ganganagar account for
39%, 18%, 9% and 4% of the State’s industrial output, respectively. The key districts
wth are Ajmer, Alwar, Barmer, Bharatpur, Bhilwara, Bikaner, Bundi,
Chittorgarh, Jaipur, Jodhpur, Kota and Udaipur.(Figure-7)
Industry Scenario in Rajasthan
To revive industrial growth in Rajasthan, the State Government has created an institutional
mechanism for attracting investment; the Bureau of Investment Promotion (BIP), Rajasthan
State Industrial Development and Investment Corporation (RIICO), Rajasthan
Corporation (RFC), and Project Development Corporation are fully operational. The State
Government has also put in place investor friendly sector specific policies, like the
Healthcare Policy, the Hotel Policy, the Power Policy, the IT Policy, the Tourism Policy,
tier Single Window Clearance mechanism exists to expedite implementation
of industrial projects: the Board of Infrastructure Development and Investment (BIDI) under
the Chairmanship of the Chief Minister of Rajasthan, followed by the State Level
Empowered Committee (SLEC) under the Chairmanship of the Chief Secretary, followed
by the District Level Empowered Committee under the Chairmanship of the Deputy
al activity and employment generation
than its large and
of Rajasthan’s industrial output comes from four regions
ra, Udaipur and Ganganagar account for
t, respectively. The key districts
Bikaner, Bundi,
Government has created an institutional
Investment Promotion (BIP), Rajasthan
tion (RIICO), Rajasthan Financial
ion are fully operational. The State
sector specific policies, like the
e Tourism Policy,
pedite implementation
Development and Investment (BIDI) under
ster of Rajasthan, followed by the State Level
f the Chief Secretary, followed
Chairmanship of the Deputy
The Resurgent Rajasthan initiativ
Rajasthan, and going forward, is expected to drive
well. A sector-wise break-up of the
Rajasthan initiative is presented
Investments through Resurgent Rajasthan (Rs. Crore)
Thus while Rajasthan has factor advantages in a num
policies and support, the Stat
unemployment rate, difficult working conditions, e
entrepreneurship and skewed economic development.
2.6.1 Identification of Growth Engines
With the above understanding of the State and the industrial scenario th
imperatives for identification of sectors for this
1. Sectors (both formal and informal sectors) driving
2. Sectors with high employment potential
3. Sectors with the requirement of skilled human resources
The parameters focused on while studying the indust
presence of the industry in the State, supplier lin
of trained manpower, availability and quality of training centre, time t
employment opportunities. The industries identified on the basis of the above
are: Auto & Engineering, Healthcare, Textiles, Repa
Gas, Food processing, Tourism and Hospitality, Handloom
and IT/ITES.
Cement
SEZ
Infrastructure
Oil & Gas
Power
Engineering
Tourism
Healthcare
Textile
Education
IT
Food processing
Gems & Jewellery
Handicraft etc.
Others
The Resurgent Rajasthan initiative has additionally brought significant investments
Rajasthan, and going forward, is expected to drive the secondary and tertiary sectors as
up of the investment proposed to be made through the Resurgent
Rajasthan initiative is presented below (Figure-8)
Investments through Resurgent Rajasthan (Rs. Crore)
Thus while Rajasthan has factor advantages in a number of sectors backed by favorable
policies and support, the State faces challenges from various dimensions such as
unemployment rate, difficult working conditions, early stage of industrial culture, need for
entrepreneurship and skewed economic development.
Identification of Growth Engines
tanding of the State and the industrial scenario therein, the key
imperatives for identification of sectors for this study were:
Sectors (both formal and informal sectors) driving the Rajasthan economy
Sectors with high employment potential
e requirement of skilled human resources
The parameters focused on while studying the industries were market linkage, historical
presence of the industry in the State, supplier linkage, infrastructure adequacy, availability
availability and quality of training centre, time taken to train, and the
The industries identified on the basis of the above