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Industrial Development & Economic Growth in Odisha

September, 2018

Odisha is one of the most mineral-rich states in India. Key minerals found in the state are iron, coal, bauxite, manganese, nickel, chromite, limestone, dolomite, graphite, decorative stones, beach sand, China clay, tin ore, etc. At 32.8 per cent in February 2018, Odisha contributed the largest share of mineral production India in terms of value. Value of minerals produced in the state reached US$ 2.71 billion in April-February 2018.

Odisha accounts for over 55 per cent of India’s bauxite reserves, making it an ideal location for setting up aluminium and aluminium-based companies. The state ranks first in the country in terms of both production capacity and actual output of aluminium.

Odisha is one of the favoured investment destinations for domestic and international iron and steel players as well as one of the largest producers of iron and steel in India. The total production of iron ore in Odisha was recorded to be 92.88 million tonnes during April-February 2018.

Between 2011-12 and 2017-18, Gross State Domestic Product (GSDP) expanded at a Compound Annual Growth Rate (CAGR) of 10.30 per cent to Rs 4.16 trillion (US$ 64.54 billion) whereas the Net State Domestic Product (NSDP) expanded at a CAGR of 10.08 per cent to Rs 3.63 trillion (US$ 56.37 billion).

Odisha is amongst the top ten states accounting for the highest number of MSME enterprises. The state offers a wide range of fiscal and policy incentives for businesses under the Industrial Policy Resolution, 2015. Additionally, the state has sector-specific policies for IT and micro, small and medium enterprises. The state government has constituted "Team Odisha" to help with investment promotion.

Odisha has vast potential for development of tourism. It is one of the critical sectors of the state’s economy, in terms of foreign exchange earnings as well as employment generation opportunities. In 2017, 14,011,229 domestic tourists & 100,014 foreign tourists visited the state of Odisha.

The following are some of the major initiatives taken by the government to promote Odisha as an investment destination:

  • Total merchandise exports from Odisha were US$ 7.59 billion in FY18.
  • During April 2018, Union Minister drafted a blue print for port-led development in Paradip under Sagarmala project .This includes 40 projects which is estimated to cost around Rs 91,000 crore (US$ 14.12 billion).
  • The Odisha Cabinet has approved the Odisha start-up policy, aimed at setting up at least 1,000 start-ups over the next five years and bringing the state amongst the top three start-up hubs by 2020.
  • In order to increase the employment opportunities in the state, Odisha government has announced plans to invest US$ 28.69 billion in the manufacturing sector generating nearly three lakh job opportunities by 2020.
  • In January 2018, the state government has given approval for five investment proposal including two Angul Aluminium Parks worth Rs 328 crore (US$ 50.66 million).
  • A mega food park is being established near Bhubaneswar over 282 acres through the PPP mode. Odisha Industrial Infrastructure Development Corporation (IDCO) is the nodal agency for the establishment of this park.
  • As per State Budget 2018-19, US$ 811.24 million has been allocated for the railway infrastructure development.
  • In budget 2018-19, the state government allocated Rs 400 crore (US$ 62.06 million) under “Smart Cities Mission”
  • As per Budget 2018-19, an amount of Rs 4,511.16 crore (US$ 699.95 million) has been allocated to the Department of Agriculture and Farmers’ Empowerment.

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