The Associated Chambers of Commerce and Industry of India has unveiled a roadmap to boost investments in Haryana and said the northern state bordering national capital has the potential to grow at double digit rates.
Major upgradation of physical and social infrastructure, creation of a more investor friendly policy framework and getting the bureaucracy to play a conducive role are required for this purpose, said chairman of ASSOCHAM's northern region development council Mr Lalit Khaitan.
Mr Khaitan said that "Haryana is establishing as a frontline state and the government is highly proactive. This is evident from e governance initiatives and infrastructural development underway."
The state economy grew at an annual compounded rate of 9% between 2000-01 and 2009-10 against the national average of 8.7%. It had live investments worth INR 427,000 crore in 2010 as compared to INR 354,845 crore in 2009 of which 79.6% were at implementation stage.
Mr Khaitan said that "We applaud Haryana for its success in achieving impressive economic growth rates on a sustained basis."
The ASSOCHAM plans to organise Invest Mart in the near future where about 300 investors from various countries will converge to explore the possibilities of investing in Haryana, he said. He also proposed setting up 14 new industry clusters each accommodating about 1,000 units and generating direct and indirect employment opportunities for four lakh workers.
Mr Khaitan said that the existing six clusters for small and medium enterprises should be upgraded to enhance productivity and cost-competitiveness. Funds required to upgrade these clusters could total up to INR 450 crore and mobilized through public private partnership.
However, ASSOCHAM's secretary general Mr DS Rawat said the Haryana advantage is yet to materialize fully. Enablers required to make these advantages really work need to be identified. In this endeavor, the ASSOCHAM lists following suggestions.
1. Enhanced emphasis on developing the agriculture sector. The composition of gross state domestic product reveals that the share of primary sector is continuously declining whereas the share of secondary as well as tertiary sector is continuously increasing. According to the Economic Survey 2009-10, the state economy is shifting from agriculture to manufacturing and services sectors which is a sign of healthy economy and the state economy is moving in the right direction. However, in a recent survey published by a leading newsmagazine, Haryana is at the second position among the top ten agrarian states of the economy. The point that needs to be highlighted here is that if the state has a comparative advantage in a particular sector as compared to others then emphasis should be laid on enhancing the growth potential of this sector which in this case is the agriculture sector. Horticulture and peri urban agriculture have great scope to flourish in the State.
2. Real estate needs to be developed as a responsible industry keeping in mind the environmental and social implications. The government needs to bring out policies keeping in mind the environmental and social implications of infrastructure development undertaken, particularly in issues like sanitation, greenery and road maintenance, so that the investments remain attractive in the long run.
3. Research and development: Innovation is the key to develop new ideas and cost effective methodologies to sustain in the competitive world. Encouragement by the government is crucial for R&D processes. Research and development has been identified as one of the thrust sectors for harnessing the long run growth potential of the state. This initiative should be taken forward at the earliest with the establishment of a taskforce to identify the sectors for these research and development institutions and also earmark clusters regions for developing them.
4. Comprehensive development plan for industrially backward regions: The government has divided the state into three clusters primarily A, B and C, where A refers to industrially developed areas, B refers to regions with intermediate development and C refers to the industrially backward regions. A comprehensive development plan needs to be made for the industrially backward regions with specific details about the incentives provided to the interested investors.
5. Tourism development of the state requires an appropriate marketing strategy and also the development of alternative tourism products. The marketing strategy entails the development of a tourism product which becomes the focal point of marketing and in this case that product can be MICE tourism and a tag line for promoting tourism in the state can be Mixing Business with Pleasure. Besides MICE tourism, the state can also promote golf tourism and medical tourism.
6. Tourism development through coordination with other states: The South India Tourism Council (SITCON) is an initiative of Andhra Pradesh government. SITCON is a body representing all stakeholders in the tourism industry in Andhra Pradesh, Karnataka, Kerala, Tamil Nadu, Goa,
Pondicherry and union territories of Andaman and Nicobar Islands and Lakshadweep to market south India as a seamless tourist destination. Such alliances can be developed for all some north Indian states also to expand their tourism potential.
7. Skill development: The state government is highly proactive in the development of the educational infrastructure of the country. There has been an increase in the number of schools at primary, secondary schools and higher secondary schools and also an increase in the number of sector specific skill development institutes. However, the government initiatives need to be supplemented by private sector initiatives to provide training to the informal sector economy which employs 92% of the workforce. Large scale private industrial participation is required to train the school dropouts so that they can be suitably employed in the respective industries.
8. Establishment of cooperatives and greater rural community participation: Development of cooperative institutions is crucial for the development of certain sectors especially food processing and active participation of local community through panchayati raj institutions or NGOs can be instrumental in development of the rural economy and inclusive growth. Women, the backbone of any community, need to be empowered and brought within the mainstream economy.
9. Increase in number of performing SEZs: Till 2009, only three SEZs had been established in Haryana and primarily in the IT space whereas ten times of the numbers are waiting to be developed. The process of converting a notified SEZ into a functional SEZ should be expedited as almost 100 proposals have been received for setting up of various special economic zones in the state of which about 31 have been notified by the Centre and another 35 have been accorded formal approval. Also, the SEZ sector focus should be shifted from IT to other sectors like food processing, health and auto components.
10. Developing a sound rural civic infrastructure: Inclusive growth or growth through empowering the rural community will require the development of a robust rural infrastructure and development of human capital formation of rural community which can be attained through timely execution of specific welfare schemes along with provision of good quality education and health facilities to one and all. The rural infrastructure development has been spearheaded by the government in the past but now the government should look towards involving the private sector suitably through PPP route.
