When you are among the best performers, then the expectations around such performers are also high. Thus, when India aspires to become a five-trillion dollar economy, Maharashtra’s contribution to that will be around one trillion dollars. To achieve that target, Maharashtra adopted projects and introduced appropriate initiatives. But the timelines could get stretched on account of the pandemic. The goal remains unchanged though.
During the Free Press Journal-Maharashtra Industrial Development Corporation (MIDC) organised webinar titled ‘Transformation of Maharashtra — Industry Revitalised’, the panel comprising experts underscored Maharashtra’s one-trillion dollar goal and its systematic approach. The panellists for the session were P Anbalagan, CEO, MIDC; Ajit Ranade, Group Executive President and Chief Economist, Aditya Birla Group; B Thiagarajan, Chairman of the CII Western Regional Council, Western Region and MD, Blue Star. The session was moderated by R N Bhaskar, Consulting Editor, FPJ.
Edited excerpts:
MIDC: How did MIDC go about making the process of land acquisition faster in Maharashtra?
P Anbalagan, CEO, MIDC: Maharashtra was the first state to have a statute for the formation of the industrial organisation, unlike many other states.
Today, MIDC has six decades of experience. MIDC does not resort to any compulsory land acquisition but engages with the landowners or farmers. MIDC never acquires agricultural land. Plus, wherever MIDC enters, even a barren plot of land is transformed into a wealth generator. We create wealth mainly with the best infrastructure — be in water, power, effluent treatment among other infrastructure. MIDC operates industry complexes in 289 locations, spread across 2.25 lakh acres.
Today, there are 50,000 acres of land available at various stages of development. Even during the pandemic, we have signed several memoranda of understanding (MoUs) and have allotted 16,000 acres of land. For MIDC’s regular business, more than 900 acres have been set aside.
MIDC has spent Rs 2,000 crore in March last year to develop these land parcels. We should be doing so this year as well. That is the trust the state enjoys and MIDC is able to maintain that trust.
B Thiagarajan, MD, Blue Star: MIDC also acquires land that an investor needs. MIDC thus becomes an enabler in this case.
In Maharashtra, elections do not impact work. An agency such as MIDC works as a professional agency, which is not the case with many other states.
Ajit Ranade, Group Executive President Aditya Birla Group: Long ago, MIDC was enlightened enough to recognise that there is a need to have a non-cohesive market-friendly way of acquiring land.
Today, MIDC is the biggest landlord in the country. It has got 100 to 10,000 acres of land in different parts of the state. These land parcels come with water connection, water effluent plant, among other infrastructure requirements.
Maharashtra has continued to maintain a numero uno position
P Anbalagan: Maharashtra is a leader, was a leader and will continue to be a leader. While the state does enjoy this position, it has to ensure that complacency does not seep into the system.
Being a frontrunner for almost six decades, you now have sister and brother states that have upped their game. To compete, Maharashtra has to offer the industry the best infrastructure and ease in doing business. The state has undertaken many initiatives to support the industry in the state.
B Thiagarajan: Maharashtra’s ability to endure change is remarkable. During the late 80s, the industry felt Mumbai (then Bombay) will fall apart, the same feeling took roots in the 90s and then now. But Maharashtra especially Mumbai has overcome those challenges. It has reinvented itself.
It is heartening to know that policymakers acknowledge the role of the private sector in economic growth today. This has been enshrined in a few policy level initiatives as well. It has been clearly articulated that the private sector will drive India’s growth. Meanwhile, India’s manufacturing growth will largely depend on Maharashtra.
Maharashtra is an undisputed leader in automobiles. But now the story is about diversification.
There are certain elements like power tariff and other things that make it difficult to operate in the state. But we are hopeful there will be some solution going forward. This is a state where if you set a target and timelines, things will happen at that pace.
Ajit Ranade: Maharashtra has occupied a preeminent place in the landscape of India. It contributes to one-seventh of the industrial output and one-fourth of exports.
Being number one or occupying a preeminent position is not enough. The reason is that inter-state competition is intensifying. It is important to be in the first place but it is all the more important to retain that place. More so is the aspiration to be in the league of various professional regions in the world.
The aspiration to become a one-trillion dollar subnational economy is not easy. There are only five or six sub-national economies in the world. And Maharashtra aspires to be in that league.
If this pandemic-induced recession did not exist, and the state was growing at 10-12 per cent, then Maharashtra could have become a trillion-dollar economy (from USD 400 billion currently) within the next five to six years.
Investments
P Anbalagan: By the end of May, barring one company, 53 companies would be grounding their investments. The CM has categorically stated that unless the MoUs are mature do not bring any more MoUs to the table.
The government has always regarded the investors with the highest regard as they generate employment and support economic growth.
Now, the state is coming up with the concept of having relationship managers or relationship executives. For any investment above Rs 50 crore, there will be a senior executive or officer who will handhold the investor to set up a business in the state. This will be supported by a country-specific desk and a special desk for Marathawada and Vidarbha. The state is all out to woo investors.
We are looking at attracting Rs 2 lakh crore (Rs two trillion) worth of investments through the MoUs signed during this pandemic. These investments will ensure 3 lakh jobs.
B Thiagarajan: It is not easy to raise Rs 2 lakh crore. But today, the mood of the private sector is upbeat. Large companies and MSMEs are convinced that the next five years will be a huge growth period for India.
At present, the mood of the private sector is towards making investments not just for the current year but plan to do so for years in advance. Various government schemes are encouraging people to go ahead and invest.
P Anbalagan: In the case of infrastructure development in the state, MIDC is developing five to six nodes and MSRDC is developing 15 nodes of Samruddhi Mahamarg. Thus, prosperity is not far away.
Metro work is picking up. While Nagpur is coming up with its metro, the issue dogging the Mumbai metros have been resolved and Nashik will have a new metro line as well.
These infrastructure projects are pumping in Rs 40 billion crore, maybe the highest in comparison to any other state. These investments are expected to touch 48 million people or say 40 per cent population of the state.
With such large on-going projects, we may be able to touch the one-trillion-economy target as per schedule.
B Thiagarajan: The speed of execution will be the catch in the case of major government infrastructure projects. When the economy opens, people will be in a huge rush, mainly because money is available in plenty. Thus, the game-changer will be the speed at which connectivity projects are implemented. This will not be limited to inter-city connectivity but also various connectivity inside the city especially Mumbai.
One thing that we cannot address is the cost of living in a city like Mumbai. It is an irreversible process. While the cost of living cannot improve, ease of living has to improve in various areas.
For a better future
P Anbalagan: Under the Magnetic Maharashtra 2.0 initiative, a set of reforms have been introduced to revitalise the economy post-COVID-19. MIDC has adopted various forms of reforms. The most prominent one is plug and play infrastructure for MSMEs. Other than trunk infrastructure, we are offering services more like a developer to these MSMEs. As soon as an MSME decides to invest in a plot, we develop the area for the entity within three months.
B Thiagarajan: From Maharashtra’s point of view, CII has been playing an active role in the joint task force and we will continue to do so. The flagship programme of Magnetic Maharashtra is close to our members.
P Anbalagan: Maha Parwana introduced to improve ease of doing business will ensure that 20-odd departments granting 100-odd permissions will be granted in a record time of 48 hours.
The portal is launched. From April 1st, this portal will be in full vigour. Any investments above Rs 50 crore will get an LOI within 48 hours.
Ajit Ranade: This year has seen a huge setback. The growth rate of the country will be -8 per cent and that of the industrial sector will be -11 per cent.
There are 15 lakh MSMEs in the state that are employing 80 lakh people with a cumulative investment of Rs 2.5 lakh crore. All these have taken a beating. To revive growth, the state will have to recognise three-four big-ticket projects which can give an impetus. These projects will allow the MSMEs to revive as well.
Connection between Samruddhi corridor and MIDC
P Anbalagan: Samruddhi corridor will bring in a lot of prosperity in the state. By May 1, 2021, hopefully, the state should be commissioning the stretch between Nagpur and Shirdi.
MSRDC has planned more than 15 nodes for logistics, engineering, agri processing, cold storage among others in these nodes. The Samruddhi project is planned in such a way that existing industrial projects are linked as well.
In Nagpur, close to Hingna and Butibori, there is a node connecting to Samruddhi Mahamarg. While Hingna is a saturated industrial area, in Butibori, phase I is completed and phase II is underway.
Around 7-8 kilometres away from landing in Amravati is the Nandgaon industrial estate. Around Rs 5,000 crore investment is planned. It is emerging as a formulation and pharma hub.
AURIC (Aurangabad Industrial) city is part of the Delhi Mumbai Industrial corridor. However, it will be able to get access to the Samurddhi interchange at Shendra. For interchange, we are investing around Rs 40 crore. We are also acquiring 15-16 acres to connect Shendra. This will enable seamless connectivity.
There are several other nodes that will be connected across the Mahamarg.
Sectoral options
Ajit Ranade: The winning strategy would be to look at the future and not the past. Industrialisation 4.0 has to be the focus — whether it is artificial intelligence, Internet of Things (IoT), biotech, green energy among others.
In the case of industry like gems and jewellery (which the Gujarat government has been wooing), if it grows, nothing like it but we should not be bogged down in the effort to protect the turf for gems and jewellery. It can co-exist in Maharashtra and Gujarat.
The automotive industry in India had fantastic success. There is a success story in IT and Pharma as well.
Skilling Maharashtra
P Anbalagan: According to a survey, around 68 per cent of the skilled youth in Maharashtra are employable, but many posts are still lying vacant. The state has the target of skilling close to 40 million people in the next five years.
Now, we need the industry to help identify 100 odd skills where the employment potential is phenomenal.
The state has signed an MoU with Cornell University to develop a post-graduate diploma programme which will be commissioned soon. To support this programme, the infrastructure needed for this will be set up in Panvel. We are also looking at domestic universities that have skill sets in technology, ICT, biology etc. All this is done to upskill the talent in the state.
With the database of Mahajobs and the skill development department, we will be able to provide employment to the youth. Here again, industrial collaboration is a must.
For instance, the Maharashtra jobs portal is a link between an employer and a skilled job seeker. It covers 17 sectors and 950 skill sets. More than 3 lakh people have enrolled, close to 80,000 jobs have been advertised and 40,000 people have applied. Around 10,000 people will be employed in private firms through this portal.
In many manufacturing units, there is a huge demand for blue-collar jobs and we are addressing this group with the help of various educational institutions and corporates.
For instance, ITI and polytechnic pass-outs should be given apprenticeship. So, they are employable.
Upcoming initiatives
P Anbalagan: The state is in the process of declaring its defence corridor. It is the only state that operates a venture capital fund that is funding MSMEs that have work orders from the Ministry of Defence. So, this identified thrust area should be given the push.
Maharashtra is mulling an innovation hub with the support of Nasscom and IIT Bombay. The state is considering an independent data centre policy, an independent emerging technology policy, and an independent engineering R&D policy.
The thrust is for growing the ecosystem rather than depending on more subsidies and incentives.
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