IT-ITES - Madhya Pradesh Facilitation Centre for NRI's by dcsvzebge


									Madhya Pradesh: Means Business
Information Technology/
Information Technology Enabled Services

                Overview               Madhya Pradesh (MP) – State that means business

                                        MP is the second largest State in the Country stretching over 308,000 sq kms.
                                        The State is blessed with large mineral resources of coal, diamond, limestone, methane etc.
                                        MP is among the top 4 states of the Country for industrial investments.

         Economic Snapshot             Madhya Pradesh is emerging as a key growth center for the Country

                                                                                                                    Per capita GSDP               USD 369**
                                        Gross state domestic product (GSDP)            USD 23,983.63 Mn**
                                                                                                                    Manufacturing sector          USD 8.5 bn**
                                        Average growth rate                            5.5% per annum
                                                                                                                     (Registered & Unregistered)

            Advantage MP               Madhya Pradesh has one of the upcoming industrial base in India

                                                                                               Total electricity generation capacity                6,449.25 MW*
                                        The State is centrally located
                                                                                               India’s first greenfield SEZ                         Indore SEZ
                                        Investor friendly Government policies
                                                                                               Industrial Centers                                   8

                  Power                Electricity generation capacity at present is 6,449.25 MW and estimated to rise to a surplus in 2008-09

                                        MP is rich in low grade coal suitable for power generation.
                                        Potential of hydro-energy generation.
                                        Installed power capacity (MP’s share)
                                                Hydel Power Generation: 852.7 MW*
                                                Thermal Power Generation: 2,147.5 MW*

*Ministry of Power (     **Source: (as on 23 Feb 2006)
 Enabling Infrastructure
                                                                                                                                   • The State is well connected with the rest

                                                                                  RAILWAY NETWORK
                                                                                                                                     of India with almost 425 trains passing
                                                                                                                                     through the State on a daily basis. Of
                                                                                                                                     these 175 trains pass through the State

                                                                                                                                     capital Bhopal alone.

                                                                                                                                   • 25 airstrips.**
                                                                                                                                   • Convenient air links from key Indian
                                                                                                             GWALIOR                 cities like Delhi & Mumbai to Bhopal,
                                                                                                                                     Jabalpur,     Gwalior,  Indore   and

                                                                                                                       KHAJURAHO   • 5 operational airports.
                                                                                                                                   • Indore airport has the capability of
                                                                                                    INDORE   BHOPAL
                                                                                                                                     handling international cargo.
                                                                                                                                   • An international airport proposed in

                                                                                                                                   • The total length of roads spanning MP is
                                                                                                                                     67,600 kms.**
                                                                                                                                   • National highways of 5,200 kms run
                                                                                  ROAD NETWORK

                                                                                                                                     through the State.*
                                                                                                                                   • 18 National highways including trunk
                                                                                                                                     routes of Delhi-Mumbai, Delhi-Chennai,
                                                                                                                                     Delhi-Bangalore, Delhi- Hyderabad.
                                                                                                                                   • The total length of State highways in the
                                                                                                                                     State is 9,885 kms.**
                                                                                                                                   • Convenient linkages to western ports i.e.
                                                                                                                                     Kandla Port, Jawahar Nehru Port Trust.

*Source: Department of Road Transport & Shipping (   **Source:
 Madhya Pradesh: A Preferred Investment Destination
31% of the State under forest                Over 2,000 kms of roads          India’s     1st     operational   Offers diverse tourists destinations
cover with a largely unexploited             being     developed     with     Greenfield SEZ at Indore          catering to various segments of
species    of   rare,   valuable             Private Partnership (BOT)                                          tourism such as religious (Bhojpur),
medicinal- herbal plants                                                                                        eco/ adventure (Panchmari), heritage
                                                                                                                (Sanchi, Khajuraho) tourism etc.

Over 100 agricultural farms with                                                                                          Third largest producer    of
an area of over 20,000 acres is                                                                                           cement in India*
available on lease to investor

Favourable       climatic                                                                                                     Various blocks available
conditions for cotton                                                                                                         for power, cement, iron
and over 40,000 power-                                                                                                        and steel units
looms are driving the
textile industry

Largest producer of pulses                                                                                                 Over    18,000    technical
and oilseeds in the Country                                                                                                graduates    and    230,000
(~75%       of    soyabean                                                                                                 graduates add to workforce
production)                                                                                                                each year

              Availability of coal and natural gas                Over 144 BCM of coal bed               12 blocks with reserves
              (G.A.I.L pipeline) along with support               methane reserves available             totalling 2,585 million tons
              from Government to make investment                                                         of coal has been identified
              in Thermal Power Plants lucrative

*Source: & Brochure: MP Means Business
 MP: The Right Place with the Right Environment
                                                                                                                                   Savings in Office Space Rates
                                                                                                                      (A comparison of rates in Central Business Districts)
  Fastest mover* in overall                                DESTINATION MADHYA PRADESH
                                                                                                                                                          Mum bai
  performance among the                                                                                                                                  150

                                                                                                                                   Ahem adabad                             Delhi
  big States in the Country.                                                                                                                             100

                                                                                                                               Bhopal                                                Bangalore


  Fastest mover in agriculture
                                                                                                                                   Indore                                          Chennai
                                                                         (740 Kms)
                                                                       (MPV - 789.5)                                                        Hyderabad               Pune

   Fastest mover in
                                                    Ahmedabad                                                         Bhopal and Indore have substantial cost
   infrastructure development.                       (570 Kms)
                                                                                                                      advantages, even when compared to other Tier
                                                   (MPV - 220.63)
                                                                                                                      III and IV cities.

                                                                                                                                        Savings in Land Cost
   Ranks 2nd in terms of                                                                               Kolkata
                                                                                                     (1350 Kms)                                  Vishakapatnam         (Estimated Values for Multi-
   governance.                                     Mumbai                                          (MPV - 613.19)                                                                  product SEZs)
                                                  (780 Kms)                                                                                       100%
                                                 (MPV - 1000)  Pune                                                                               80%
                                                             (800 Kms)
                                                           (MPV - 206.51)     Hyderabad                                                           60%
                                                                                                    Key Markets          Indore                                                    Chennai
                                                                               (840 Kms)
  Ranks 3rd in terms of law &                                                (MPV - 257.9)          (Distance From
                                                                                                    Bhopal)                                       20%
  order                                                                           Chennai           MPV – Market
                                                               Bangalore        (1430 Kms)          Potential Value                                 0%
                                                              (1400 Kms)      (MPV - 362.84)
                                                            (MPV - 254.52)

                                                                                                                          Jaipur                                                   Greater Noida
  Cost of skilled labour is USD
  2.4/day vis-a-vis USD 3.5 –
  USD 4.0/day in metros
                                                                                                                      The cost of land is one of the lowest in the Country.
                                                     MP is centrally located. The State is at an easy distance from
                                                                                                                      Even central hubs such as Indore and Bhopal fare
* Fastest mover is the State where the rate of               all the key consumer markets in the Country.             well against other cities in terms of low land cost.
improvement between 2003 & 2006 was greater
than that between 1991 & 2003

**Source: India Today (September ‘06 Issue)      Source: (Reference: RK Swamy)         - Distances rounded off
Industrial Policy: Catalyst for the Investments
The Government of MP has devised an investor friendly industrial policy,
                                                                                                                                         SPECIAL INCENTIVES
which is aimed at achieving global competitiveness. The policy emphasizes
                                                                                                         • Special package for Mega Projects on project basis by apex level
on industrial growth in the state through adopting cluster approach,
                                                                                                           investment promotion empowered committee headed by the Chief
establishing specialized infrastructure and offering favourable incentives.                                Minister.
                                                                                                         • Industrial investment promotion assistance – 50% to 75% of commercial
The main thrust of this policy is:                                                                         tax for 3-10 years
                                                                                                         • Concessional registration charges and stamp duty exemption for
 • Establishment of a Madhya Pradesh Trade                     and Investment                              Term Loans.
   Facilitation Corporation which would take                   decisions about                           • Interest subsidy on term loan for 5 – years @ 3% to 5%.
     rationalization of taxes, facilities of mega projects and other related                             • For thrust sector industries, 25% capital subsidy would be provided
                                                                                                           limiting up to a maximum of USD 56,000
                                                                                                         • Land on 75% concessive rate for Mega Projects limited to USD 4.4
 • Enacting an Industrial Facilitation Act and to change the rules of                                      million.
                                                                                                         • Entry tax exemption for 5 years.
   business with a view to make single window system decisive and result
                                                                                                         • 5 years electricity duty exemption on captive power generation
                                                                                                         • 15% capital subsidy to SSI up to USD 33,000 in backward areas
 • Developing infrastructure for supporting the identified industrial                                    • Infrastructure grant up to USD 0.22 million crore for developing private
                                                                                                           sector industrial parks
                                                                                                         • Partial reimbursement for Project report, ISO Certification, Patent and
                                                                                                           Technology Purchase cost
 • Reviving closed down/ sick industrial units by granting special packages.
 • Attractive incentive schemes.

                                        CLUSTER APPROACH                                                               Crystal IT Park         Indore

                                                                                          SPECIALIZED INFRASTRUCTURE
                                        • Indore – Pharmaceutical, Textile,        Food                                                        Mandsaur, Khargone, Chhindwara,
                                          Processing, IT, Auto Components                                              Food Parks
                                                                                                                                               Hoshagabad, Mandla and Bhind
                                        • Bhopal – Engineering, Biotechnology, Herbal,
                                          IT, Food Processing                                                          Stone Park              Katni

                                        • Jabalpur – Garment, Mineral, Forest & Herbal,                                Herbal Park             Rewa
                                          Food Processing
                                                                                                                       Granite Park            Chhatarpur
                                        • Gwalior – Electronics, IT, FMCG, Engineering,
                                          Food Processing                                                              Life Sciences Project   Bhopal
                                        • Rewa – Refractories, Lime Stone, Forest Based
                                                                                                                       Apparel Park            Indore (SEZ)
                                        • Sagar – Mineral Processing
                                                                                                                       Gems & Jewellery Park   Indore

    Doing Business Made Easy Through MPAKVN
              In a bid to build a competitive environment; industries and their ancillaries would be promoted in clusters based on the availability of raw materials,
              skilled labour and market potential. Under this Industrial Policy through Madhya Pradesh Audyogik Kendra Vikas Nigam Ltd (MPAKVNs)
              scheme, the State Government, has identified industrial clusters. Many of the industrial giants have their establishments in these areas, however 44% of
              developed area is still untapped and open for investment.

               Area Developed: 1,330 Hectares                           Area Developed: 2,262 Hectares                              Area Developed: 790 Hectares                      Area Developed: 273 Hectares

               Allotted: 618 Hectares                                   Allotted: 800 Hectares                                      Allotted: 125 Hectares                            Allotted: 115 Hectares

                                                                                                                    JABALPUR AKVN
                                                         GWALIOR AKVN

                                                                                                                                                                          REWA AKVN
               Units established: 286                                   Units established: 326
                                                                                                                                    Units established: 52                             Units established: 121
               Major Groups:HEG, Crompton                               Major Groups: JK, Surya Roshini,
                                                                                                                                    Major Groups: Raymond, Hindustan                  Major Groups: Birla, Jaypee
               Greaves, P&G, Godrej, Lupin, IFB,                        Godrej, Grasim, Cadbury, Hotline,
                                                                                                                                    Petroleum, PBM, Ayur
               Oswal, Nahar                                             Crompton Greaves                                                                                              Special Infrastructure: Integrated

               Special Infrastructure: ICD, Food                        Special Infrastructure: ICD, Food                           Special Infrastructure: Stone Park,               infrastructure development centres

               Park                                                     Park                                                        Food Park                                         (IIDC)

               Area Developed: 2,492 Hectares
                                                                                                        Malanpur, Malanpur
               Allotted: 1431 Hectares                                                                  Phase II, Banmore,
               Units established: 575                                                                   Pratappura

                                                                                                                                                                                          Total developed           7,147
               Major Groups: Tata, Ranbaxy, Eicher,                                                                                                   Rewa, Waidhan                             area               Hectares

               Bridgestone, Hindustan Motors, Kinetic,                                                                                                                                                              3,089
                                                                                                                                                                                         Total allotted area
               SRF, S Kumars, Gajra, Nicholas Piramal,                                                    Mandideep,                                                                                               Hectares
               Indorama, IPCA, Bhilwara                                                                Mandideep Phase II                                                                      Total units
                                                                                                                                         Borgaon, Maneri,                                                           1,360
               Special Infrastructure: SEZ, Crystal IT                             Pithampur, Kheda,                                     Purena
                                                                                   Dewas, Maksi,
               Park, Food Park, Apparel Park                                       Megh Nagar                                                                                             Growth centres             19

                                                                                                                                                                                                               Source: MPSIDC
                                  Sector Profile

Information Technology/ Information
Technology Enabled Services Industry
Sector Profile: IT/ ITeS Industry

 Information Technology: Evolving Landscape

 Growing IT Sector in MP

 Computerization in Government Departments: e – Governance

 Advantage MP

 MP: Offering Specific Incentives

 MP: An Investment Destination

 Way Forward

 Connecting Further

Information Technology: Evolving Landscape
 • Over the last decade, India has been recognized as a major and credible
                                                                                                                    IT/ITeS Exports
   Information Technology (IT) outsourcing destination the world over. The IT
   sector is one of the fastest growing segments of Indian industry.                                                                             23.9
 • Indian IT/ ITeS industry continues to deliver double-digit growth over the past                  20

                                                                                             $ bn
                                                                                                    15     13.3
   several years now and is expected to exceed USD 36 billion in annual revenue in                  10
   FY 2005-06.                                                                                       5

 • The Indian IT/ ITeS industry has been growing at a CAGR of over 28% since FY                          2003-04            2004-05             2005-06

   1999-2000. Over the same period, the industry’s contribution to the national GDP                                                       Source: Nasscom
   has risen from 1.9 per cent in 1999-2000 to a projected 4.8% in the current fiscal

 • Export earnings accounted for 64% of the total IT/ ITeS aggregate in 2004-05.
   Strong fundamentals including a large base of skilled talent, demonstrated quality
   and service delivery expertise at a significant cost advantage and an enabling
   environment have ensured that India attracts a disproportionately larger share of the
   global IT/ ITeS demand for off shored services – and continues to drive India’s
   export-led growth.
                                                                                           GROWTH DRIVERS
 • IT/ ITeS exports from India grew from USD 13.3 billion in FY 2003-04 to USD 18.2        • 100% Income Tax exemption on export profits is available to
   billion in FY 2004-05. It is estimated that total IT-ITeS exports from India will         SEZ for 5 years.

   exceed USD 23.9 billion in the current fiscal (FY 2005-06).                             • Growth in sales of personal computers (PC) (3.6 Million units in
                                                                                             2004-05) is expected to boost the domestic demand.
 • Software and services exports (excluding hardware) are projected to grow at 32% in
                                                                                           • Excise duty on computers and peripherals is nil.
   the current fiscal.

 • The total number of IT and ITeS-BPO professionals employed in India has grown           IT & ITeS industry is expected to grow to USD
   from 284,000 in 2000 to 1,287,000 in 2005-06.                                           148 Billion by 2012

Source: Nasscom
Growing IT Sector in MP
• Located at the very heart of India, Madhya Pradesh is the second largest State and is
  easily accessible from every corner of the Country. From agriculture to natural          EXPORTS
  wealth, industry, power and people, Madhya Pradesh is abounding with potentials.
                                                                                               The IT/ ITeS exports from MP is USD 655 million:
• MP has a made a a significant progress in the last couple of years and is further
                                                                                           •   Software exports: USD 11 million
  paving way to be at the forefront of the IT revolution.
                                                                                           •   IT Enabled Services: USD 644 million
• The State has set up over 24,000 kms of optical fibre backbone to cover all its 313
  developmental blocks across 45 districts (One of the highest optical fibre coverage in                                          Source:

  the Country).
                                                                                                                          MP EXPORTS
• Four software technology parks (STP units) are in the pipeline to be setup in
  Bhopal, Indore and Gwalior. These parks will be equipped with all modern facilities,
                                                                                                        10.90%     1.80%
  which are required for smoothly operating software export units, including high-speed                                                         Soyabean

  data connectivity.                                                                                                                            IT/ ITeS
                                                                                                                                       45.60%   Diamond
• The State boasts of 38 IT engineering colleges and provides a learning ground for                                                             Leather Products

  the future IT professionals by establishing the Country’s first Indian Institute of
  Information Technology and Management (IIITM) at Gwalior. This is an added                                                      Source:
  advantage to the investors looking to invest in the IT space in the State as there
  would be a wide availability of qualified and skilled professionals at a relative low             Proposed investment

                                                                                                                                                               MAJOR IT PLAYERS IN MP
  manpower cost.                                                                                    of USD 34 million

• The Government is providing various incentives/ concessions to attract investors.        Proposed

  Major players like Taurus Microsystems and Fujitsu already have their presence in
  the State and are on the road to further expand their operations under the favourable
  industrial policies and IT initiatives by the State Government.
• The large IT players like HCL and Genpact are also geared up to make their
  establishments in the State. HCL has identified their location in the upcoming green                               BHOPAL
                                                                                                        INDORE SEZ
  field SEZ at Indore. Genpact India has proposed to set up a 7,000-seat BPO facility
  in Bhopal, with an investment of USD 34 million. The company has been allotted 50
  acres of prime land near the airport in Bhopal (Bairagarh) for its BPO operations.

Growing IT Sector in MP
      Software Technology Park – Indore                                                 IT Park – Gwalior

      • State of the art facility being set upon 1,00,000 sq ft of                      •   IT infrastructure is being developed on 50 acres of land
          space.                                                                            through private participation.

      • Data communication facilities are available through the hi                      •   The Park is being developed as a training hub imparting
          speed STPI and VSNL networks.                                                     advanced training for the needs of the IT industry

      • Fully air-conditioned space with round the clock canteen
          and well maintained surroundings

      • 100% power backup
                                                                                                                    IT Park
      Crystal IT Park – Indore

      •   Developed on 21 acres of land in the heart of the business
          capital of M.P

      •   5,50,000 sq ft of       space    under    development being
          commissioned shortly in the first phase                                                                 Hardware &
                                                                                                  STP Indore
                                                                                                                Technology Park

      Hardware & Software Technology Park – Bhopal
                                                                                                  Crystal IT Park
      •   IT infrastructure being developed on 200 acres of land near
          upcoming International airport

      •   Developed plots and built up space as per international
          standards to be made available
                                                                                                  PROPOSED/ EXISTING PROJECTS IN M.P.
      •   Facilities for housing, entertainment, schools to be built in
          and around the campus of the proposed IT Park

With all the ingredients of a metro, without pollution, traffic and rapidly increasing property prices, Bhopal, Gwalior and Indore is everything about opportunity

Computerization in Government Departments: e - Governance
The joint study conducted by IDC & Dataquest, ranks Madhya Pradesh as the fourth leading state in India in terms of
           overall perceived improvement of delivery of Government Services through e-governance initiatives.

                 Perceived Improvement in Delivery of State Government Services to CITIZENS Through E-Governance
     S.       E-Governance Assisted Service               Highest                           State Scores
     No               Delivery Area                        Score
                                                                    Gujarat    Madhya          Kerala       Uttar    Karnataka
                                                                               Pradesh                     Pradesh
     1     Water utility- service delivery & support       91.4      85.0        91.2           82.2        80.0       83.4

     2     Municipal taxes- payment & information          89.6      88.6        89.6           84.0        75.6       84.2

     3     Applying for birth/ death/ marriage             89.6      89.6        89.6           82.4        76.8       70.8

     4     Power utility- service delivery & support       92.4      92.4        88.6           80.0        80.0       85.2

     5     Filing of income tax returns                    91.4      91.4        87.8           90.0        82.6       80.6

             Perceived Improvement in Delivery of State Government Services to CORPORATES Through E-Governance
     S.       E-Governance Assisted Service               Highest                           State Scores
     No               Delivery Area                        Score
                                                                    Andhra    Maharashtra     Madhya       Gujarat   Karnataka
                                                                    Pradesh                   Pradesh
     1     Income tax department- filing of tax returns    94.6      85.6        80.0           92.4        90.4       82.0
     2     Registration of land                            91.4      88.0        71.2           90.6        83.4       71.6

     3     Executing sale/ purchase of land/ property      93.6      93.6        72.8           90.4        80.0       70.0
     4     Income tax department- application for PAN      94.4      84.2        77.2           89.6        90.4       82.2

     5     Sales tax/ Service tax- filing of returns       89.6      89.6        74.6           89.6        84.6       75.8

Source: IDC, 2006
Computerization in Government Departments: e - Governance
  Government of MP has laid great emphasis on computerization of the revenue generating departments and the departments with large
  public interface. Major e-Governance projects in the State are listed below.

 TRANSPORT DEPARTMENT                                                                               TREASURY NETWORK

 The department has implemented computerization of its activities viz. issue of                     Department of Finance, which manages government funds through treasuries and
                                                                                                    sub treasuries, is also implementing major computerization project to automate
 driving licenses, vehicle registration, permits etc. With Smart Card interface, on a
                                                                                                    and network with the State Headquarters. This aims to facilitate information
 Build Own Operate (BOO) basis, the project has been operational since January
                                                                                                    access on-line and bringing greater transparency and efficient fiscal management
 2002                                                                                               of resources. Project will be operational shortly.

 E-KRISHI VIPNAN (EKVI)                                                                             LANDS RECORD DIGITALIZATION

 M.P.    State    Agriculture    Marketing     Board     (Mandi    Board)      has   initiated      Project implemented to computerize the record of ownership of agriculture land of
 computerization of all its offices and mandis (around 230) phase wise, to facilitate               approximately 6.50 million landholders. It has been operational in the entire State
 e-agricultural marketing in MP Private sector company are implementing this                        for quite sometime now and almost all the records have been digitalized. Copies
 project on a BOO Model. Presently a pilot is under implementation.                                 of the records are made available to the citizens, at Tehsil Offices

 MADHYA PRADESH TAXATION NETWORK                                                                    COMPUTERIZATION OF PROPERTY RECORD REGISTRATION

 Commercial Tax Department, the highest revenue earning department of the
                                                                                                    Stamps and Registration Department, another major revenue earning department
 Government, has implemented an ambitious and comprehensive project to
                                                                                                    of the Government, is in the process of computerizing its operations. Software for
 facilitate on line registration and filling of tax returns. Under this project, a
 database of all tax payers has been created and all 55 locations of the department                 the activity has been developed and a pilot project has also been operational.

 are networked                                                                                      Now the department is rolling out the pilot in all its offices on BOT model

• MP is among a few front-ranking Indian States to use e-governance effectively in providing health services and promoting trade, business and industry.

• A nation-wide survey by DataQuest magazine ranks MP among leading States like Kerala, Delhi, Gujarat and Goa in the use of e-governance.

• The State holds first position in rendering pubic utility services through e-governance in areas such as municipal corporation, land (revenue), income tax and law. It also stood first in making
  proper arrangements to provide e-payment facility to the corporate sector.

Emerging IT/ITeS Hubs of MP
   S.                 FACTORS                                               The           Major Cities of MP
                                                         BHOPAL                         INDORE                  GWALIOR                  JABALPUR
  1      Population                                       1843510                        2465627                  1632109                  2151203

  2      Educational Infrastructure

         Engineering Degree Passouts                        7740                           3780                     2580                     2090

         Engineering Diploma Passouts                       965                            665                      790                      1629

         MBA Passouts                                       1020                           1550                     370                       320

         Presence of Major Institutions        Maulana Azad National Institute      Indian Institute of        Indian Institute of   Agriculture University
                                                of Technology, National Law           Management           Information Technology
                                                University Judicial Academy                                     & Management

  3      Basic Infrastructure

         Air Connectivity                      Delhi, Mumbai, Gwalior, Indore,    Mumbai, Delhi, Bhopal         Delhi, Bhopal               Bhopal

         Rail Connectivity to Major Cities             All major cities              All major cities          All major cities         All major cities

         Power Supply                                   No power cut                  No power cut          Power cut for 2 hours       Power cut for 2

         Presence of Major Industries                   BHEL, HEG                     Automobile,                  leather           Cement, Ordinance,
                                                                                    Pharmaceuticals                                      Telecom

  4      Support Infrastructure

         Hospitals                                   Excellent facilities           Excellent facilities       Good facilities          Good facilities

         Hotels                                 Presence of 3*, 4* & Heritage     Presence of 3*, 4*, 5*   Presence of 3*, hotels     Presence of 3*, 4*
                                                           hotels                       hotels                                             hotels

         Malls/ Movie Halls/ Shopping                Excellent facilities           Excellent facilities       Good facilities          Good facilities

  5      Land Cost                                      INR per sq m                  INR per sq m              INR per sq m             INR per sq m

         Residential land costs- Min to Max            700 to 25,000                 1,000 to 30,000            700 to 28,000           230 to 31,500

         Commercial land costs- Min to Max                    -                        750 to 4,500            2,000 to 45,000          600 to 60,000

Source: Census 2001, AICTE, Local survey, IGRS, District website
MP – An Investment Destination
• Madhya Pradesh is poised to become the next IT destination of India through its IT infrastructure development strategy and government
  support to the investors. There are many significant avenues and areas that can be tapped for setting up and scaling up your
  business operations.

• To further support your business endeavors Government of Madhya Pradesh is developing specialized infrastructure in the form of SEZ
  Indore, IT Parks in Bhopal, Indore and Gwalior. Being an industry of economic importance, the Government also provides special fiscal
  and non fiscal incentives to the units in the State.
                                                                                                            COST INDICATORS FOR ESTABLISHING AND OPERATING BUSINESS IN MP*

     KEY CONCERNS OF                                                                         BENEFITS/
                                       HOW MP OFFERS AN ADVANTAGE                                                          INDICATOR                       VALUE (USD)
       THE INDUSTRY                                                                           SAVINGS

                                                                                                             Industrial land (per sq m)                  5-30

                                                                                                             Office space rent (per sq ft per month)     0.5 - 1
      Rising Salaries        In MP, the average cost to the company for the same
     (In India the rise in   executive is cheaper than 15 - 30 % as compared to other
                                                                                           annual savings    Residential rent (for a 2,000 sq ft
     salary is 13% YoY)      industrially developed/ developing cities                                                                                   280 - 350
                                                                                                             house, per month)

                                                                                                             5-star hotel room (per night)               80-100

                             The rate of prime land is among the lowest as compared to     Considerable      Electricity (per kWh)                       0.09 - 0.13
     Land/ rentals cost
                             other areas of the Country                                    annual savings
                                                                                                             Water (per 1000 liters)                     0.2

                             High speed data communication facilities are available at a   High speed
        Connectivity                                                                                         Some of the other supporting factors assisting your
                             bandwidth of 2 Mbps                                           connectivity      business would be:
                                                                                                               • Central location
                                                                                                               • Low set-up costs (Land, building etc)
                              The State has one of the longest laid optical fibre cable
                                                                                           Excellent           • Specialized infrastructure
                               network (~ 24,000 kms).
       Infrastructure                                                                      investment          • Low operating cost
                              Large scale infrastructure development like SEZ Indore
                               and setting up of IT parks in Indore, Bhopal and Gwalior                        • Low attrition rates
                                                                                                               • Government support etc.

                                                                                                                                                   * Source: IBEF Reports (2005)
Advantage MP
• Conducive environment for industry, package of incentives with investor friendly                        SPECIAL IT INITIATIVES

                                                                                          • Madhya Pradesh has taken steps to promote IT in
 IT Policy.                                                                                 various aspects of governance.
                                                                                          • The    State Government has prescribed various
• Because of the central location the State is well connected to the major cities in        guidelines/ principles and general conditions for
                                                                                            allowing private participation and investments in e-
 the Country through air, road and railways. Presently the government is also               Governance projects for citizen services.
                                                                                          • The Government has also initiated changes in the
 focusing on strengthening its road transport network. This excellent connectivity of
                                                                                            labour laws to make them more favourable to IT
                                                                                            industries. 24X7 working days has been cleared by
 the State is the key to all logistics related issues for the present and the potential     the labour department.
 upcoming industries.                                                                     • A project is currently being executed in the Dhar district
                                                                                            of the State to leverage IT to offer value added
                                                                                            services to the common man at the rural level.
• Presence of institutes of international repute like IIM (Indore), National Law
                                                                                          • As part of this initiative, information flows and services
 University (Bhopal), IIITM (Gwalior) and a large number of engineering,                    like wholesale price, details on land records,
                                                                                            registration of applications, public grievance redressal
                                                                                            etc. would be made available online to the citizens of
 management, medical and other professional courses fulfill the needs of high
                                                                                            the district.
 quality education and provide the sources of quality workforce. The cost of              • The Government has signed a Memorandum of
                                                                                            Understanding with the Reliance group for
 professional manpower is comparatively less in MP (10-15% cheaper) as                      providing telecom connectivity to 7,800 kiosks
                                                                                            across the State.
 compared to other industrially developed/ developing States.
                                                                                                                          No. of             No. of
                                                                                                                        Institutes          Students
• Despite the potential, the rate of prime land in the State is among the lowest in
                                                                                                Engineering                 61               20210
 the Country, thereby offering an indirect advantage to the potential investors by
                                                                                                   MCA                      45                2310
 reducing their capital investments.                                                               MBA                      47                3735

                                                                                               Polytechnics                 49                9094
• The law and order conditions in the State are among the best in the Country
                                                                                             Industrial Training           110               14298
 thereby making it a safe place to invest and a better place to live.                             TOTAL                    312               49647

                                                                                                                                 *Brochure from IT Department
MP – Offering Specific Incentives
 The State Government has announced certain incentives specific to the IT/ ITeS industry for attracting investors to the State. Following
 are the incentives for the IT industries in Madhya Pradesh*:

 1) Employment and Land Rate Concessions

 • The companies in the State would be eligible for the rebate of USD 556 per job created or;

 • A concession on land rate at 25% of the prevalent premium on investment of USD 2.22 million and above based on following schedule:

                                             Project Costs (USD Million)   Maximum land available under concession
                                             2.22 to 4.44                  10 acres
                                             4.44 to 11.11                 15 acres
                                             11.11 to 22.22                25 acres
                                             22.22 and above               Case to Case basis

 2) Stamp Duty

 • Stamp duty payable by IT companies on mortgage/ hypothecation with banks/ financial institutions in IT investment area will be
     exempted provided the new unit is certified to be an IT outfit by a designated agency.

 • Stamp duty and registration fee exemption will be applicable on- sale/ lease by financial institution/ government agencies/ private
     sector who acquire space/ premises in IT investment area for subsequent lease to IT units provided the new unit is certified to be an IT
     outfit by designated agency.

 3) Exemption on Tax & Acts

 • Exemption from factories act, maternity act, contract labour act, payment of wages act, minimum wages act, ESI act.

 • Exemption from the electricity duty tax, entry tax and work contract tax.

                                                                                                                                 * Source: Brochure
MP – Offering Specific Incentives
 • IT units in IT investment area will be exempted from the octroi, entry tax and local bodies tax for all capital goods and raw material
     purchased by them.

 • Rate of property tax in the IT investment area will be at par with residential premises.

 4) Power Related Incentives

 • No prior permission will be required for installation of the captive power plant.

 • IT industry shall e provided power through a dedicated feeder.

 5) Others

 • Exemptions upto twice the existing FAR for entire IT investment area

 • All facilities and incentives declared in the new Industrial Policy of MP Government are also applicable for IT Industries established on
     government allotted land/ private land with the single window clearance for government formalities

                                                                                                                                * Source: Brochure
Way Forward
• With large IT players like HCL and Genpact proposing to invest in the State, and the presence of major players like Fujitsu and Taurus
 Microsystems, many more companies are expected to follow suite. And the increasing trend of the industry for shifting from tier I to tier II
 cities would result in increased IT activity, eventually leading to the overall IT/ ITeS development in the State.

• Hence there are increasing opportunities for IT park developers and IT companies to come and invest in Madhya Pradesh.

           PROJECT                                    STATUS                                            FACILITIES                  OPPORTUNITIES

                                                                                            •   Plug & play facilities             Investors are invited by
                            • Developed on 21 acres of land in Bhopal                       •   100% power backup                  the government to
      Crystal IT Park                                                                                                              commence their
                            • 5,50,000 sq ft of space under development                     •   Ample parking space                operations in the ready
                                                                                            •   4 kms from city centre             office space

                                                                                            • Fully air-conditioned space with     Investors are invited by
                            • State of the art facility having 1,00,000 sq ft of space.                                            the government to
                                                                                              round the clock canteen and well
      STP Indore            • Data communication facilities through the hi speed STPI         maintained surroundings              commence their
                              and VSNL networks.                                                                                   operations in the ready
                                                                                            • 100% power backup                    office space
                                                                                                                                   Government envisages
                                                                                            • Developed as a training hub
      IT Park – Gwalior                                                                                                            private participation in
                            • IT infrastructure is being developed on 50 acres of land.       imparting advanced training for
                                                                                                                                   the development of the
      (Proposed)                                                                              the needs of the IT industry

                            • IT infrastructure being developed on 200 acres of land near   • Facilities for housing,              Government envisages
      Hardware & Software     the upcoming International airport                              entertainment, schools to be built   private participation in
      Technology Park –                                                                       in and around the campus of the      the development of the
      Bhopal (Proposed)     • Developed plots and built up space as per international
                              standards                                                       proposed IT Park                     park

     Considering the present scenario and the momentum being gained by the industry, the State is poised to be the next IT haven of India

Connecting Further

       Madhya Pradesh Agency For Promotion of Information Technology

         Madhya Pradesh State Electronics Development Corporation

         Madhya Pradesh State Industrial Developmental Corporation

                   Department of Information Technology       

                      Government of Madhya Pradesh           

                                Indore SEZ                   


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