Investment Climate in Goa

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1 Investment Climate in Goa

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3 GOA PAGE 3 Table of Contents Executive Summary... 4 Goa - Select indicators... 5 Economic Overview of the State... 5 Goa s economic performance... 5 People - Economic prosperity... 6 Industrial performance... 6 Industrial centres... 7 Investments... 8 Goa s contribution in India s exports... 8 Labour Force... 8 Infrastructure Industrial infrastructure... 9 Educational Infrastructure... 9 Medical & Health Care Facilities... 9 Infrastructure for savings and borrowings...10 Physical Infrastructure...10 Policy Framework...11 Industrial Policy Information Technology Policy Biotechnology Policy Key Nodal Agencies...13 Key industries and players in Goa...14 IT/ITES and Electronics industry...15 Mining...16 Pharmaceuticals...16 Tourism...17 Fisheries...17 Doing Business in Goa...18 Contact Information...19 A report by ICRA for IBEF

4 Executive Summary Investment climate is a broad concept, encompassing all the factors affecting business decisions, including profi tability and where to locate plants and other units. A good investment climate provides opportunities and incentives for fi rms to invest productively and create jobs, thus playing a key role in ensuring sustained growth and poverty reduction. Factors infl uencing investment climate include: Availability and ease of use of factor inputs such as land and labour; Availability of adequate physical and social infrastructure, such as power, telecom, urban infrastructure, water supply, hospitals, and educational institutions; Governance and regulatory framework in terms of rules and regulations governing entry, operation, and exit of fi rms, stability in regulation, integrity of public services, law and order and investment facilitation; and Provision of incentives and access to credit. Goa, a tiny emerald land on the west coast, is the 25th state in the Union of India. Liberated from Portuguese rule in 1961, it was part of the Union Territory of Goa, Daman and Diu till 30th May 1987, when it was carved out to form a separate state. It covers an area of 3,702 sq km, and for the purpose of revenue administration is divided into two districts North and South Goa, with their headquarters at Panaji (six talukas) and Margao (fi ve talukas), respectively. Though a late entrant to the planning process, Goa has emerged as one of the most developed states in India and has even been ranked as one of the best in India with respect to investment environment and infrastructure, by the Confederation of Indian Industry. The state has recorded an impressive compound annual growth rate of 8.84 per cent in its gross domestic product between and , and the per capita income in the state is amongst the highest in the country. in the form of industrial estates and special economic zones. The Government of Goa has established the Goa Industrial Development Corporation (GIDC) to secure and assist rapid and orderly establishment of industries. It has established 20 industrial estates. There is at least one industrial estate in each taluka. The Goa Industrial Policy 2003 created statutory bodies that have clearly defi ned roles and authorities. Several institutions have been set up to promote tourism, small-scale industries and infrastructure. Amongst the prominent ones is the High Powered Co-ordination Committee set up to cater to the infrastructural requirements of industrial units, particularly in the medium- and large-scale sector. The state has a fairly well-developed education system. The banking industry has a strong network across the state. In terms of penetration of banking facilities for households, Goa is ranked number one in the country. In terms of per capita deposits, Goa is ranked number three. The per capita deposit in Goa is $2,482, against the all-india fi gure of $420. The state also ranks well on social indicators like literacy and health. Goa is committed to create an attractive and conducive investment climate for private investors. The steps taken so far in implementing appropriate policies and creation of physical infrastructure have ensured that economic growth in the state has remained more than 8.5 per cent per annum over the last seven years. The state is at the forefront of attracting investments, which have come in areas like mining, tourism, IT and ITES, pharmaceutical, and manufacturing including sectors such as paints and fertiliser. The state s Industrial Policy 2003, aims to achieve accelerated industrial development, catalyse economic growth, ensure balanced regional growth, protect the environment and create sustainable employment for local youth in the state. Its thrust is on promotion of specifi c industries, in particular those consuming locally available raw materials, and producing goods that will be consumed within the state and the neighbouring areas. Specifi c policies have also been announced to encourage sunrise industries like pharmaceuticals, biotechnology, food-processing and agro-based, IT and IT-enabled services (ITES), tourism - including medical tourism, and entertainment. The government s focus has been on infrastructure development

5 GOA PAGE 5 Goa - Select indicators Capital International Airport Dabolim International Airport Panaji the rest of the country through a well-knit network of roads, railways and airline services. Land Area (sq km) 3,702 Climate Summer (February to May) Rainy season (June to September) Winter (October to January) Average Rainfall (mm) 3,005 Number of Districts 2 Number of Cities/Towns 44 Number of Villages 347 People Major religions Hinduism, Islam, Christianity Principal languages Konkani, Marathi, English Population (in millions) (2001 Census) Share of urban population 49.8% State s share in India s population 0.13% Sex ratio (females per 1,000 males) 861 Literacy Rate 82.3% Birth rate in 2003 (per thousand per annum) Death rate in 2003 (per thousand per annum) 7.46 Infant mortality rate in 2006 (per thousand children) 16 Industry Key industries having business potential Tourism, Mining, Pharmaceuticals, Fishing Goa s economic performance The gross state domestic product (GSDP) stood at $2.41 billion in , with an impressive compound annual growth rate (CAGR) of 8.84 per cent from onwards. The tertiary sector (comprising tourism, hotels and restaurants, transport, storage and communication, fi nancial services, public administration and other services) continues to be the mainstay of the state s economy. The contribution of the secondary sector (comprising manufacturing, construction and electricity, gas and water Goa s GSDP US$ billion CAGR 8.84% Source: Directorate of Planning, Statistics & Evaluation, Goa Economic Overview of the State With a gross domestic product of $2.41 billion, Goa, though amongst the smaller states of India, is a prominent state in terms of growth achieved and investments attracted. The economy of Goa is based on tourism, mining, agriculture, commerce and trade, manufacturing and fi sheries. Renowned for its beaches, Goa is visited by thousands of international and domestic tourists each year. It is a major contributor to the foreign exchange earnings of the country. Goa is the only state in the country with the distinction of achieving a high level of economic growth as well as social development. The average economic growth of 8.8 per cent per annum in the past seven years, a high per capita income of about $1,545 and high rankings on social infrastructure indicators stand testimony to this distinction. Goa is amongst the few states that have achieved 100 per cent rural electrifi cation. All the villages in Goa are connected by road and all households have access to drinking water. The state is well-connected to Percentage distribution of GSDP CAGR 13.0% 11.5% 5.89% 33.7% 38.2% 12.80% Primary Sector Secondary Sector Tertiary Sector Source: Economic Survey of Goa, % 50.3% 7.77% supply) has also been signifi cant. The contribution of the primary sector (comprising agriculture and livestock, fi shing, mining and quarrying) has been marginal, with fi shing, mining and quarrying providing for most of the growth within this sector. The share of the tertiary sector in the GSDP has fallen from 53.3 per cent in to per cent currently. High growth has been witnessed in the secondary sector (CAGR of

6 12.8 per cent). As a result, the share of the secondary sector grew from 33.7 per cent in to 38.2 per cent in This growth was driven by increased construction activities for private dwellings as well as for infrastructure development. In fact, the construction sector in Goa, which has roughly one-fi fth share in the secondary sector, grew at 31.4 per cent CAGR between and , while electricity, gas and water supply grew at a CAGR of 32.9 per cent during the same period. The manufacturing sub-sector grew at a CAGR of 7.96 per cent between and The share of the primary sector has fallen over the years, though mining- and quarrying-related activities continue to be strong in the state. The mining belt of Goa covers an area of approximately 700 sq km and is mostly concentrated in four talukas Bicholm, Salcete, Sanguem and Quepem. A major ironore exporting state, over 60 per cent of the country s iron ore exports are from Goa. the poverty line during the year was only 12 per cent, as compared to the all-india fi gure of per cent. The annual household income in Goa is also an important indicator of the economic prosperity of its people. A comparison of distribution of households by various income categories in Goa vis-à-vis the all-india fi gures shows that the share of households in higher income categories in Goa is more. This holds true both for urban and rural households. For example, more than one-third of Goa s urban households and 16.3 per cent of rural households fi gure in the highest income category of $6,667 and above, as compared to only 22.7 per cent and 4.6 per cent, respectively, at the all-india level. Only 10.8 per cent of Goa s urban households fi gure in the lowest income category of less than $1,667, as compared to 12.1 per cent of all-india urban households. In rural areas, only 7.2 per cent of Goa s households are in the lowest income category, as compared to 46.2 per cent of all-india rural households. People - Economic prosperity The per capita income in Goa is amongst the highest in the country. Having grown from $951.7 in 2000 to $1,544.7 in 2006, it is substantially higher than the all-india per capita income of $ The estimated percentage of population in Goa below Another factor that points towards the economic well being of the people in Goa is the ownership of physical assets like vehicles and consumer electronics. Assets like four-wheelers, two-wheelers and television are indicators of consumer aspirations. A comparison of asset ownership by households indicates a higher ownership of these assets in Goa vis-à-vis all-india. Distribution of Household by Income (per cent) Urban <US$ 1, US$ 1,668-3,330 US$ 3,331-6, >US$ 6, Distribution of Household by Income (per cent) Rural <US$ 1, US$ 1,668-3, US$ 3,331-6, >US$ 6, Goa India Source: The Market Skyline of India 2006 by Indicus Analytics Industrial performance Industries in Goa have been growing at a robust rate. When Goa achieved statehood in 1987, there were only 3,200 small-scale industrial units and just 46 medium- and large-scale units. By the end of calendar year 2006, the state had 7,095 small-scale industrial units providing employment to nearly 50,000 people and 209 medium- and large-scale industrial units providing employment to over 25,000 people. About 2,040 units have been established in the 20 industrial estates in the state. They range from tiny to large scale units, covering a diverse range of activities from food processing to manufacturing sophisticated Parameter Working Units (No.) Large & Medium Industries 209 7,095 Small Scale Units Investment US$ 1.45 billion US$ 83 million Employment ( 000 number) Source: Economic Survey of Goa ( )

7 GOA PAGE 7 computer peripherals as well as defence and telecommunications equipment. The state government has set up a High Powered Co-ordination Committee to cater to the infrastructural requirements of industrial units, particularly in the medium- and large-scale sectors. The committee cleared 396 industrial projects during According to the Director of Planning, Statistics and Evaluation, Government of Goa, the Index of Industrial Production for the state, which mainly comprises mining and manufacturing, has increased from 268 in to 400 in , driven primarily by manufacturing. Goa is emerging as a manufacturing base for several leading companies in areas like fertilisers, tyres and tubes, cement, electrical machinery, fi sh net making machines, automatic washing machines, printed circuit boards, pharmaceuticals, pharmaceutical machinery and so on. Industrial centres in Goa Industrial Centres Products/Industries Verna Rubber, plastics, petroleum and coal products, pharmaceuticals, electronics and telecommunication equipment Bicholim Iron and steel-based units Kundaim Rubber, plastics, petroleum & coal products Margao Pharmaceuticals Mormugao Shipbuilding and repair Vasco Shipbuilding and repair Source: Goa Economic Indicators, Goa Chambers of Commerce The main industrial centres in Goa are Verna, Ponda, Vasco, Mormugao, Bicholim and Kundaim. Goa has only two districts: North Goa and South Goa. Verna is located in North Goa district and a number of pharmaceutical companies are located here. They include Cipla, Blue Cross Laboratories and Glenmark Pharmaceutical Ltd. Margao, located in South Goa, is an industrial and commercial centre and the district headquarters. It is home to Aventis and other pharmaceutical companies. Ponda, located in North Goa, is home to some big corporate names including Nestle, MRF and Marico.

8 Investments in Goa The state is amongst the most preferred investment destinations in the country. Foreign direct investment infl ow into the state in the period January 2000 to May 2007 amounted to $183 million. Amongst the key investments being made in the state is that by the Mormugao Port Trust, which is implementing the Baina Bay Project in South Goa at an estimated cost of $40 million. The project involves construction of a berth for cruise and container vessels at the port. The project envisages construction of 825-metre-long breakwater and a berth 400 metres in length, dredged to 11 metres. It would also have excellent cruise terminal facilities and provide container-handling facilities. The project is expected to be completed by The Mormugao Port Trust is also undertaking the Vasco Bay Project at an estimated cost of $74 million to build cargo bays. suffi cient workforce (both skilled and non-skilled) is a major advantage that the state offers, making it an attractive destination for investment. According to estimates by the Regional Employment Exchange, even though unemployment in Goa has decreased over the years, nearly 101,800 people were either unemployed or under-employed. Industries in Goa have a good track record as far as safe working conditions are concerned. Fatal injuries per thousand workers employed in Goa in 2001 were only 0.12, as compared to 0.19 on an all-india level, while non-fatal injuries per thousand workers were 4.53 as compared to 8.48 on a national level. Some of the major industrial investments made in recent times are: Coke plant - Sesa Kembla Coke Co. Ltd. at Panaji in North Goa in 2000; Drug formulation plant - Cipla Ltd. at Verna in North Goa in 2001; Drug formulation plant - Glenmark Laboratories Ltd. at Verna in North Goa in 2001; Petroleum products terminal - Zuari Industries and Indian Oiltanking (a 50:50 joint venture between Indian Oil and Oiltanking GmbH of Germany) in South Goa in Goa s contribution in India s exports Though Goa is a small state in terms of both area and population, it contributes signifi cantly to the national exchequer. Goa receives over 10 per cent of foreign tourists visiting the country and almost 15 per cent of the foreign exchange earnings from tourism are generated in the state annually. Over 60 per cent of the total iron-ore exported from the country is from Goa, which is worth more than $222 million every year. Goa is also known for its liquor business and agricultural produce. It produces more than 125 million coconuts and over 27,000 tonnes of cashew nuts annually. The state also exports marine products. In 2003, total exports from the state were worth $638 million. Labour force in Goa As per Census 2001, of the total population of million in Goa, 0.52 million comprised the workforce. The availability of

9 GOA PAGE 9 Infrastructure in Goa Industrial infrastructure The Government of Goa has established the Goa Industrial Development Corporation (GIDC) with the aim of securing and assisting rapid and orderly establishment of industries in industrial areas and industrial estates. GIDC has established 20 industrial estates in the state. It has constructed and allotted 716 sheds and has developed 2,458 plots in these industrial estates. There is at least one industrial estate in each taluka of the state. Two state fi nancial corporations Economic Development Corporation of Goa Ltd and Maharashtra State Financial Corporation Ltd extend term loan assistance to small-scale entrepreneurs through a number of schemes. Goa Handicrafts, Rural & Small Scale Industries Development Corporation Ltd (GHRSSIDC Ltd.) caters to the raw material as well as marketing needs of the small-scale units in the state. The Goa Chamber of Commerce and Industry (GCCI) plays a major role in promoting the state as an investment destination. It is among the oldest chambers of commerce in India and has an over 500-strong membership base, including large- and medium-scale companies. The chamber works closely with various government departments for enactment of favourable policies as well as educating its members on issues of business, industrial and regulatory signifi cance. As a result of its efforts, a large number of electronics, pharmaceuticals, and engineering companies have set up manufacturing facilities in Goa. It also has an investment facilitation team, which provides investmentrelated data to the industry. Amongst the prominent industrial estates in Goa, Verna electronics city has attracted a large number of units in thrust sectors like electronics, engineering, plastics, pharmaceuticals and logistics. Educational Infrastructure There are several professional educational institutions, including management schools, law colleges, engineering colleges, polytechnics and industrial training institutes (ITIs) and a catering institute in the state. The prestigious National Institute of Oceanography (NIO) is a leader in marine research in India. The Goa Medical College is amongst the oldest in Asia. The state has 23 general education colleges and 22 for professional education. Status of Educational Institutes 1,224 Primary Schools 436 Middle Level Education Institutes 372 Secondary Level Education Institutes 81 Higher Secondary Level Institutes 35 Vocational and Professional Institutes 25 Colleges for General Education 20 Colleges for Professional Education There are 11 industrial training institutes (ITIs) in Goa, one each in Farmagudi, Panaji, Mapusa, Margo, Cocora, Pernem, Bicholim, Sattari, Canacona, Vasco and Aquem-Baixo. Medical & Health Care Facilities Comparison of Health Indicators All-India Goa Birth rate* Death rate* Infant Mortality Rate** Life Expectancy at Birth (years) Male Female * per thousand persons ** per thousand live births Source: Census 2001 Goa has 19 primary health centres, fi ve community health centres and a number of sub-health centres. Of these, 13 primary health centres and all community health centres provide 24- hour healthcare and have gynaecological and paediatric facilities. The establishment of this network has enabled Goa to maintain health indicators considerably better than the national average. The state has a sound health care infrastructure with 32 government hospitals and 106 private hospitals. The Maritime School under the Captain of Ports Department of Government of Goa, is the fi rst of its kind in the country imparting seamanship and marine engineering training.

10 Health Institutions in Goa Medial Institution Number Government Hospitals 31 Private Hospitals 123 Rural Medical Dispensaries 29 Community Health Centres 5 Primary Health Centres (with attached beds) 1 3 Primary Health Centres (without beds) 6 Source: Directorate of Health Services, Goa 2004 Roads The state has an expansive network of roads connecting different areas. The construction of the 135-kilometre North-South Expressway from Patradevi to Pollem is at a preliminary stage. Total road length in Goa is 9,672 km, out of which nearly 71 per cent is surfaced. The road density is 2,613 km per 1,000 sq km, which is higher than the national average of 730 km per 1,000 sq km. National Highways in Goa span over 269 km, comprising highways 4A and 17H that run through the state. There are eight state highways, covering a total distance of 232 km. Infrastructure for savings and borrowings Due to the spurt in development programmes in Goa after its union with India in 1962, many banks opened their branches in the state. The State Bank of India opened its fi rst branch in Panjim on 2nd January Other commercial banks followed swiftly, with some of them setting up their regional offi ces in the state. Goa now has an excellent banking network. In terms of penetration of banking facilities for households, the state is ranked number one in the country. At the end of 2006, there were 466 banking offi ces in Goa. The spread of banks is generally measured in terms of population served per bank offi ce. In Goa, the population covered per bank offi ce works out to 2,892, which is much better than the national average of over 16,000. The banking offi ces in Goa have over 3 million deposit accounts. In terms of per capita deposits, Goa is ranked number three in India, next only to Delhi and Chandigarh. The per capita deposit in Goa is $2,482 against the all-india fi gure of $420. Financial Institutions in Goa Co-operative societies 2,244 Primary agricultural credit societies 255 Indian commercial banks 41 banks, 360 branches Source: Reserve Bank of India Physical Infrastructure Transport The government of Goa is committed to developing a wellplanned and effi cient transport network. Railways Goa is well connected through the Indian Railways network. About 69 routes connect Goa to other parts of the country. The Konkan Railway has increased the scope of trade and tourism in the state considerably. The existing Vasco-Miraj railway line has been converted into broad gauge, which has facilitated direct rail link from Goa to New Delhi. Goa is connected through South Central Railway to leading locations like Bangalore, Chennai and Hyderabad. Civil Aviation Goa is connected by air with most Indian cities like Mumbai, Delhi, Pune, Bangalore, Madras, Hyderabad, Cochin and Trivandrum. It has an international airport, the Dabolim International Airport, with fl ights to Sharjah, Kuwait, Colombo and Dubai. Chartered fl ights from Europe arrive here regularly. Goa is currently ranked eighth in all-india traffi c and handled more than 20,000 civil aircraft and 2.2 million passengers in This is a phenomenal increase over the fi gures for about 7,900 civil aircraft and 0.88 million passengers. Waterways Goa enjoys the unique benefi t of having a well-developed internal water transport network of roughly 250 km formed by a grid of navigable rivers. This offers industries an economical mode to transport goods throughout the state. The River Navigation Department provides safe, dependable and affordable transport facilities on different ferry routes. The Mormugao Harbour, a general-purpose cargo berth, situated in the port town of Vascoda-Gama, handles local and international maritime cargo traffi c. It is strategically linked by rail and road to the rest of India and occupies a prominent position as the country s premier iron-ore exporting port. Over 23 million tonnes of iron-ore (39 per cent of the total iron ore exports from India) are exported annu-

11 GOA PAGE 11 ally through the Mormugao Harbour to China, Japan, Korea and Europe. Power Goa is a power surplus state with a per capita power consumption of 1,603 Kwh in While power available in the state has been estimated at 394 MW, demand stood at 305 MW in The aggregate technical and commercial losses have been brought down to below 17 per cent from around 25 per cent to 30 per cent earlier. Goa is among the few states that have achieved 100 per cent rural electrifi cation. All 44 towns and 347 villages in Goa have electricity supply. Telecom & IT Telecom facilities in Goa are on par with other metro cities in the country. Optical fi bre provides high-speed access to a wide range of Internet-related services. Goa is the second state in the country to achieve 100 per cent automatic telephone network; there are 136 telephone exchanges in the state. In 2005, the state had 145 telephones per 1,000 inhabitants compared to just fi ve per 1,000 at the all-india level. In addition to Bharat Sanchar Nigam Limited (BSNL), the backbone telecom services provider owned by the Government of India, private players like Reliance, Tata Teleservices and Airtel, offer services such as wireless voice and mobile Internet. A number of broadband and dial-up connectivity facilities are available, including satellite link, infrastructure for setting up VPNs, video conferencing and voice telecom. The Directorate of Information Technology in Goa serves as the enabler for promotion of e-governance, e-education and streamlining of IT to promote the IT/ITES industry. Several measures have already been instituted by the government such as increasing computer literacy and establishment of infrastructure conducive to the development of IT. The government announced its IT Policy in October To attract IT/ ITES companies, the government has identifi ed a 95-acre area to be developed as the Rajiv Gandhi Habitat at Donapaula. This is aimed at attracting small and medium industries. Allotment of plots has already been completed. The government has also identifi ed about 250 acres of land in and around Socorro village to develop an IT Park. Policy Framework The following have been identifi ed as thrust industries in Goa: Pharmaceuticals, drug and biotech Food-processing and agro-based industries IT and IT-enabled services Eco-tourism, heritage tourism, adventure tourism, event tourism, medical tourism Entertainment Industrial Policy 2003 The Government of Goa announced the new Industrial Policy in 2003 with a broad vision to ensure accelerated industrial development, catalyse economic growth, ensure balanced regional growth, protect the environment and create sustainable employment for local youth in the state. It encourages industries that consume locally available raw materials, and whose output is consumed within the state and in neighbouring areas. The other salient objectives of the policy are: Develop Goa as an export and import hub and encourage export-oriented industries; Promote and encourage agro-based industries and handicraft products; Create a healthy climate for the growth and promotion of small-scale and cottage industries; Promote and encourage the process of technological upgradation/ automation in the existing units as well as new industries; Create cluster development centres in rural areas around which traditional livelihood earning professions can develop and thrive; Encourage industries which can convert industrial waste such as mining rejects, slag etc., into useful products; Encourage participation of women entrepreneurs in industrial development; Taluka Ponda Pernem Bardez Bicholim Satari Tiswadi Salcete Mormugao Quepem Sanguem Canacona Industrial Estate Bethora, Madkaim, Kundaim, Shiroda Tuem Colvale, Mapusa, Pilerne, Tivim Bicholim Honda and Pissurlem Corlim Verna and Margao Sancoale and Cuncolim Kakoda Sanguem Canacona

12 Facilitate revival and rehabilitation of sick industrial units by devising suitable schemes; Promote research and development to enable the industry to have access to state-of-the-art technology. Consequent to the announcement of the industrial policy, some of the schemes that are being implemented are: Capital Contribution Scheme The scheme envisages providing capital contribution to the existing functional units to expand. The scheme is designed to promote industrial units run by local entrepreneurs that develop products based on locally developed technology. Share Capital to Local Entrepreneurs and Self Employed Scheme The main objective of this scheme is to encourage local youth, preferably of Goan origin, to start income generating activities and to encourage self-employment. Under this scheme, share capital contribution is provided to the local youths for all activities related to industrial and selfemployment opportunities, except those that fall under the Red Category in the Industrial Policy and those related to tobacco and liquor. Preferential Purchase Incentives for Small Scale Industries Scheme Under this scheme, small-scale units registered in Goa are given preference in tenders fl oated by government departments or any purchases made by them. Interest Subsidy Scheme The scheme aims at providing subsidy to small-scale industries and tiny units in the manufacturing sector on interest payable by them. The main objectives behind the scheme are to provide incentives to small industries for making their units fi nancially sustainable and to create an attractive environment for small investors and local entrepreneurs to invest. Goa State Financial Incentives to Industries for Certification and Patenting Scheme The scheme envisages encouraging the industrial units to obtain ISI certifi cation and patent rights on products and processes. Such units act as benchmarks of excellence and serve as models for others to emulate. Incentives to Women Entrepreneurs Scheme In order to increase the employment opportunities for women entrepreneurs, the new Industrial Policy envisages special incentives like preferential allotment of sheds and plots in industrial areas. The Goa State Employment Subsidy Scheme for the Industries This scheme is meant to provide subsidies to industrial units where local youths constitute 80 per cent of the unit s total workforce. Incentives to encourage consumption of local raw material This scheme envisages encouraging consumption of locally produced raw materials by offering incentives in the form of subsidy in power and water bills. The Goa State Export Market Development Scheme In order to encourage the Goan industry to export, fi nancial assistance in the form of interest-free loans is granted to certain units engaged in exports, depending on the criteria decided by the government. Information Technology Policy 2005 Goa has the potential to be an attractive destination for software and hardware companies and local IT companies. The IT/ ITES industry holds immense value for Goa owing to the industry s inherently non-polluting character and the fact that it places only conservative pressures on precious resources such as land, electricity and water. The state enjoys the advantage of a high literacy rate and has a large pool of technical and English-speaking population. The government believes that IT is the key for ensuring welfare of the people of Goa, as the industry can create employment opportunities in a number of diverse sub-sectors. The government, through this policy, promotes the use of IT to improve effi ciency in government departments. It is applying information technology in government services including tax collection and tax assessments. The policy aims to increase earnings from export of software, computers, computer peripherals, telecom services and ITES. The policy promotes the creation of state-of-the-art infrastructure for IT including a robust telecom network for Internet proliferation. The policy encourages the use of information technology in schools, colleges and educational institutions, to enable students to improve their skills, knowledge and job prospects and to obtain employment in this sunrise industry.

13 GOA PAGE 13 Biotechnology Policy 2006 The Biotechnology Policy aims to ensure accelerated growth in education and research and in areas such as healthcare, agriculture, industry, services and environment management. The policy document identifi es the factors required to ensure such growth and enumerates the steps to be taken by all stakeholders including the government. The policy promotes public-private partnership (PPP). Keeping in view the strengths of the state, the Biotechnology Policy concentrates on development of the following sectors: Agriculture: Mass propagation of locally available horticulture and medicinal plant species, mushroom cultivation, bio-fertiliser and bio pesticides, organic farming, transgenic crops; Healthcare: Vaccines, therapeutics, diagnostics, drug delivery systems, isolation of bioactive molecules from native herbs, contract research and manufacturing, animal healthcare products; Industrial biotechnology: Fermentation of beverages, bakery and dairy products, probiotics, nutraceuticals and health food supplements, bioenergy; Environmental biotechnology: Bioremediation, phytoremediation, biowaste conversion and management; Bioresource utilisation: Inventorisation, mapping, molecular characterisation and bioprospecting; Bioinformatics: Genomics, proteomics, drug designing, data mining; Bioservices: Contract research, contract manufacturing, bioinstrumentation; Marine biotechnology: Isolation and cultivation of elite marine organisms for value-added products. The key objectives of the policy are: To prioritise thrust areas for basic and applied research and technology development; To promote innovations in R&D by providing fi nancial and infrastructural support and by encouraging public-private partnership for R&D; To provide quality infrastructure and an enabling environment for sustained growth and international competitiveness through effective networking of industries, universities and premier research institutions; To develop human resources in various areas of biotechnology through enhanced fi nancial support for higher education and research in universities in relevant areas of biotechnology; To set up a venture capital fund to promote innovations of commercial importance in the academic fi eld; To encourage creation and protection of intellectual property and ensure effective implementation of the IPR regime; To provide fi nancial support and incentives to industry to encourage local investment and to attract investment; To provide an institutional framework comprising the government, academia, subject specialists, venture capitalists, industry and industry associations and to evolve a welldefi ned structural and legal framework to achieve the above objectives. Key Nodal Agencies Single Window Policy in Goa The Goa Industrial Policy 2003 has revamped the single window clearance mechanism in the state. It has created statutory bodies that have clearly defi ned roles. The GIDC acts as a facilitator for investment promotion for medium- and large-scale industries. The state has created a High Powered Coordination Committee (HPCC), which approves projects that are worth more than $1.19 million. The Chief Minister chairs this committee. Representation includes members from the Electricity, Public Works, Factories and Boilers departments and Managing Directors of GIDC, Economic Development Corporation and representatives from Goa State Pollution Control Board and Town and Country Planning Department. The Director of Industries, Trade and Commerce is the Member Secretary of this committee. The Director Industries, Trade and Commerce, handles investments less than $1.19 million. Single Window Clearance Mechanism in Goa INVESTMENTS HANDLED UNDER THE CHAIRMANSHIP OF Greater than Highpowered The Chief Minister US$ 1.19 million Clearance Committee Below Department of Director of Industries, US$ 1.19 million Industries, Trade Trade and Commerce and Commerce NODAL AGENCY Goa Industrial Development Corporation (GOA - IDC) District Industries Centre The Industrial Entrepreneurs Memorandum (IEM) is fi led with the Government of India, Ministry of Industry, for projects worth more than $2.38 million and with the state government for projects less than $2.38 million. The GIDC and the District Industries Centre act as nodal agen-

14 cies for various projects in the state. GIDC handles the creation of Special Economic Zones (SEZs). The Government of Goa has set up various institutions to promote tourism, small-scale industries and develop infrastructure. High Powered Co-ordination Committee The government has set up a High Powered Co-ordination Committee to cater to the infrastructural requirements of industrial units, particularly in the medium- and large-scale sectors. All medium- and large-scale units, including industrial units requiring release of substantial power, water, land and infrastructural facilities and those more likely to cause pollution have to seek specifi c approval of HPCC, by providing the required information in the prescribed format.the HPCC meets regularly for deliberating on and discussing all the applications. Goa Industrial Development Corporation GIDC has been established for the purpose of securing land and assisting in the rapid and orderly establishment of industries. Twenty industrial estates have been set up by the corporation to provide state-of-the-art infrastructure facilities. Uninterrupted power, water supply and a network of good roads is available in most areas. Economic Development Corporation Ltd The Economic Development Corporation Ltd. has emerged as a leading fi nancial institution promoted by the government to perform the role of a scheme manager and operate various fi nancial schemes. It provides fi nancial assistance to entrepreneurs for starting, expanding and modernising their activities. In particular, it extends services to the following: Small and medium entrepreneurs in the industrial sector Tourism sector Medical infrastructure Service sector Construction sector Infrastructure development Goa Handicrafts Rural and Small Scale Industries Development Corporation GHRSSDC has been set up to promote the traditional arts and crafts created by Goan artists and artisans. It performs functions such as procurement and distribution of indigenous and imported raw materials and assists small-scale units in marketing their products. It has started the Deen Dayal Swayamrojgar Yojana, a scheme under which youth can avail of opportunities for self-employment. It provides loan assistance to unemployed youth for taking up self-employment activities such as information kiosks, cyber cafes, vending kiosks for selling vegetables, fruits, fl owers, newspapers, magazines, etc. The Goa State Infrastructure Development Corporation This corporation has been set up as a special purpose vehicle with the basic aim to further develop infrastructure in a timebound manner. Goa Tourism Development Corporation This was established to specifi cally promote tourism and related activities in Goa, which is the fi rst state to accord industry status to the tourism sector. Special emphasis is being laid on developing eco-tourism, heritage tourism, adventure tourism, medical tourism and event tourism. Goa Horticulture Corporation It explores the possibility of promoting investments in exportoriented projects such as cultivation of exotic fruits and vegetables, fl oriculture etc. It also attempts to reduce the dependence of the hospitality sector for procuring exotic fruits and vegetables and fl owers from outside the state. The Corporation is also entrusted with development of horticulture estates and establishment of sales outlets for local produce through establishments called Krishi Ghar. Information Technology Corporation Realising the potential of IT, the government has set up the Information Technology Corporation. Its mandate includes development of IT-related infrastructure, IT-enabled services and implementation of e-governance objectives of the government. Key industries and players in Goa The industrial policy of Goa has identifi ed the following thrust sectors for focused attention: Pharmaceuticals, drugs and biotech Food processing and agro-based industries IT and IT-enabled services Eco tourism/heritage tourism/adventure tourism/event tour-

15 GOA PAGE 15 ism/medical tourism Entertainment Some big corporates in the state are: Berger Paints Berger Paints is the second-largest player in the decorative paints market and the third largest paints company in India. Berger is also a major supplier of auto paints to leading car manufacturers like Fiat, Tata Motors, Bajaj Tempo, TVS, Ashok Leyland and Swaraj Mazda. The company s factory is located at Kundaim Industrial Estate in Goa. Crompton Greaves Ltd Crompton Greaves is a leading private sector enterprise in the business of manufacturing and marketing products related to the generation, transmission, distribution and utilisation of power. It also executes turnkey projects. The fans division of Crompton Greaves is the market leader in India. It is one of the leading exporters to the USA, Italy, South Africa, Ghana, Fiji, Singapore, Bahrain, the UAE, Sri Lanka, the UK, France, Oman and Sudan. The company has two manufacturing facilities in Goa at Bethora and Kundaim. Goa Carbon Ltd Goa Carbon Ltd was set up in 1976 as a public limited company. It manufactures calcined petroleum coke (CPC), a vital input in the production of basic aluminium metal and titanium dioxide. The 100,000 tonnes per annum capacity calcination unit was set up with technical assistance from Great Lakes Carbon Corporation, USA, in southern Goa near Marmugoa port. The company s revenues grew at a CAGR of 72 per cent from $17 million in 2001 to $41 million in It exports about 70 per cent of its production. The company s major domestic consumers are Nalco, Indal and Hindalco. Kodak India Ltd A subsidiary of Kodak Ltd, UK, Kodak India Ltd was the fi rst photography company to set up operations in India. Kodak has established itself as a leader in imaging. One of its three manufacturing facilities is located in Goa. MRF MRF manufactures the largest range of tyres in India and is the market leader with the largest market share in almost every segment of the tyre industry. The company has a distribution network of over 2,500 outlets in India and overseas offi ces in the UAE, Bangladesh and Vietnam. The company exports to over 75 countries worldwide. MRF has six manufacturing plants in India, one of which is located in Ponda in Goa, built with an investment of $5.7 million. Titan Industries Titan Industries is India s leading watch manufacturer. Its business activities cover watches, clocks and jewellery. Titan employs around 3,700 personnel, and its manufacturing facilities occupy a built-up area of 33,000 sq m in India. Its Goa facility is located at Verna Electronic City, Salcette, and produces electronic circuitry for quartz watches. Zuari Chambal Group The Zuari Chambal Group is a diversifi ed conglomerate with a turnover of $1.1 billion, with investments in fertiliser, cement, hybrid seeds, biotechnology, ready-to-assemble furniture, chemicals, software, investment, home fi nance and engineering services. Its fertiliser division was Goa s fi rst mega industrial undertaking. The fertiliser plant in Goa has an installed capacity of 946,200 metric tonnes per annum. The estate includes on-site and off-site facilities for handling raw materials, end products as well as the generation of steam and captive power. IT/ITES and Electronics industry Goa, despite being small in size and a late starter in the IT space as compared to other like Andhra Pradesh, Karnataka, Tamil Nadu and Haryana, is today ideally placed to capitalise on the worldwide IT boom. Goa is one of the most literate states in India, with an over 80 per cent literacy rate. The majority of the population is conversant with English. Goa University offers a post-graduate course in computer sciences. Also, there are over 250 institutes imparting IT education. D-Link (India) Pvt Ltd D-Link (India) Pvt Ltd is a part of the multinational D-Link Corporation, which has a presence in 26 countries. Its core business is in the area of networking and communications. D-Link is also present in the motherboard market through a joint venture with Gigabyte Technology, Taiwan. The company has more than 120,000 sq ft manufacturing space in three state-of-the-art facilities in Goa. These facilities are ISO 9001 and ISO certifi ed.

16 Tata Infotech Ltd Established in 1977, Tata Infotech is part of the 125-year-old Tata Group. The company operates in the areas of system integration, contract hardware manufacturing and IT education. The hardware manufacturing division in Mapusa, Goa, is over two decades old. The factory manufactures automated teller machines (ATM), cash dispensers, bill payment machines, check encoders/sorters and complex electro-mechanical products. The manufacturing unit, set up over an area of 60,000 sq ft, consists of two independent centrally air-conditioned units, one dedicated to exports and the other for domestic markets. Mining The mining belt of Goa covers an area of about 700 sq km and is mostly concentrated in four talukas Bicholim, Salcete, Sanguem and Quepem. Mining has been a very important element in the economic history of modern Goa. It has provided the trigger to boost the economies of the mining talukas. Iron, manganese and bauxite ores are the major minerals found in Goa. The iron ore industry is the backbone of the Goan economy. Iron ore, which is of low iron content, is made marketable by processing. Ore is exported in the form of lumps, fi nes and pellets. The proximity to a natural seaport with modern amenities adds to the state s advantages. Minerals in Goa MineralsUnits Quantity Value in USD Million Iron Ore (Total) 000 tonnes 2, Iron Ore (Lumps) 000 tonnes Iron Ores (Fines) 000 tonnes 1, Iron Ore Conc. 000 tonnes Manganese Ore Tonnes Laterite Tonnes 1, All Minerals 19.4 Source: December 2005 Sesa Goa Limited The fl agship company of the Sesa Group, Sesa Goa is India s largest exporter of iron ore in the private sector. For the past fi ve decades, the group has been involved in iron ore mining, benefi - ciation and exports. Over the last decade, it has diversifi ed into the manufacture of pig iron and metallurgical coke. In Goa, it has 84 coke ovens with a capacity of 280,000 tonnes. Pharmaceuticals Major growth in the pharmaceuticals sector in Goa started in the late 1990s. The fi ve-year tax holiday for Goa announced in the Union Budget in 1993 gave further impetus to the industry. Today there are over 120 registered units employing about 18,000 people. A number of pharmaceutical companies have set up manufacturing facilities in Goa; they include Cipla, Aventis and Blue Cross. The pharmaceutical industry is the second largest employer after the mining sector in the state. Apart from the incentives and tax holiday that the state offers, Goa is a preferred destination owing to its pollution-free environment, which is conducive to the pharmaceuticals industry. A number of auxiliary units in packaging and printing have also been set up to meet the requirements of the pharmaceutical industry. Under the Cluster Development Program (CDP) of the State Industrial Development Organisation, small-scale units manufacturing pharmaceutical products in the state have been identifi ed as a cluster and concerted efforts are underway to develop and promote them. The sole aim of the CDP is to diagnose the potential areas of improvement in the member units within the cluster and provide them with possible support for their survival, sustenance and healthy growth. Aventis Pharma Aventis Pharma India is a wholly-owned subsidiary of Aventis Pharma Worldwide. The group has a state-of-the-art manufacturing facility in Goa. The site, which has been certifi ed by the World Health Organisation (WHO), has been identifi ed as a global sourcing site for Daonil. The facility at Goa is the fi rst site to successfully adopt spray granulation technology for the production of Daonil. The 120,000 sq m site is one of the leading pharmaceutical manufacturing centres in the country. Blue Cross Laboratories Ltd Blue Cross Laboratories Ltd, established in 1981, has carved a niche for itself in the Indian pharmaceutical market. Blue Cross employs over 900 people and has a turnover of over $25 million. The company has offi ces in Myanmar, Nepal, South America, Middle East and South Africa. The manufacturing facility at Goa spans over a 12,000 sq m area and is a WHO-approved plant. Cipla Limited One of the largest drug fi rms, Cipla manufactures and mar-

17 GOA PAGE 17 kets bulk drugs and formulations. The company has a plant in Verna Industrial Estate, which contributed 27 per cent to the total goods manufactured by the company in The plant is earmarked to produce the company s range of anticancer and hormonal drugs. Merck KgaA Merck India, the Indian subsidiary of German company Merck KgaA, was set up in Merck is the sole manufacturer of bulk vitamin-e in India, with a capacity of over 300 tonnes per year. Vitamin-E bulk is the active ingredient in Evion, which is Merck s third-largest selling domestic brand, with a market share of over 80 per cent in the category. The company has a soft gelatin manufacturing plant at Usagon in Goa. Nestor Pharmaceuticals Nestor Pharmaceuticals has more than 300 products in different therapeutic categories in the domestic market. The company has three manufacturing plants in the country and one formulation plant in Goa. Unichem Unichem Laboratories Ltd is another leading pharmaceutical company. The $4.6 million Bardez plant in Goa manufactures non-antibiotic oral dosage forms and is focussed on the US market. Vicco Laboratories Established in 1952, the Vicco Group has emerged as a leading manufacturer of Ayurvedic products. The group has set up one of its three manufacturing facilities in Goa. Commissioned in 1997, the plant has a built up area of 90,000 sq ft. The facility in Goa bagged the Best Construction Award instituted by the American Concrete Association. Other major pharmaceutical players in Goa are Novartis (Margo), Kare Group (Verna), German Remedies (Kundaim), and Indico Remedies (Verna). Tourism Goa has emerged as an important tourism destination in the country, both for domestic and foreign tourists. A blend of eastern and western cultures, and friendly and hospitable people make Goa a veritable tourist paradise. Tourism is a major economic activity and has made substantial contribution to the economic development of the state in terms of employment generation and valuable foreign exchange earnings for the country. Tourism has emerged as a focal point for development. The innovative marketing strategies to project Goa as an all-time destination has started yielding results. The state has started an initiative to enter into public-private partnerships for promotion of tourism by instituting a corpus fund. In million tourists visited Goa; they included 300,000 international tourists. Fisheries Goa has a 130 km-long coastline and inland waterways spread across 250 km. In , over 96,300 tonnes of marine fi sh and 4,133 tonnes inland fi sh were produced, worth about $64 million and $5.4 million, respectively. Goa has been a major exporter of seafood to the USA, Japan and Europe. Annual Fish Catch (in tonnes) Tonnes 120, ,000 80,000 60,000 40,000 20,000 Marine Inland Source: Economic Survey US$ million 5,000 4,000 3,000 2,000 1, Export of Marine Products Tonnes 16, ,000 8,000 4, Quantity (Tonnes) Value (US$ million) Source: Economic Survey of Goa US$ million