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Industrial Development & Economic Growth in Odisha

Last updated on Mar, 9 2021

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Per capita Income

 


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, and tin ore. In 2019-20^, Odisha contributed the largest share (47.5%) of mineral production (by value*) in India. Value* of minerals produced in the state reached Rs. 299.17 billion (US$ 4.24 billion) in 2019-20^.

Odisha accounts for over 55% 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 among the largest producers of iron and steel in India. Total production of iron ore in Odisha stood to at 134.28 million tonnes during 2019-20 (till February 2020).

The state's economy witnessed high growth rates between 2015-16 and 2019-20, with Gross State Domestic Product (GSDP) expanding at a Compound Annual Growth Rate (CAGR) of 12.77%.

Odisha has emerged as a key state with regard to the mineral and metal-based industries.

It is the first state in India to have undertaken reform and restructuring initiatives in the power sector. As of November 2020, Odisha accounted for a total installed power generation capacity of 8,592.20 MW, comprising 3,828.22 MW under state utilities, 2,797.02 MW under the private sector and 1,966.98 MW under central utilities.

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 2019, 15.30 million domestic tourists and 115,128 foreign tourists visited Odisha.

The state attracted Foreign Direct Investment (FDI) inflow worth US$ 616 million between April 2000 and September 2020 according to the data released by the Department for Promotion of Industry and Internal Trade (DPIIT). Investment intentions filed in the state is Rs. 29,826 crore (US$ 4.27 billion) in 2019.

Below are some of the major initiatives taken by the Government to promote Odisha as an investment destination:

  • Total merchandise export from Odisha was about US$ 6.66 billion in FY20 and reached US$ 6.38 billion between April and November 2020. 
  • In November 2019, JSW Infrastructure commissioned a new iron ore terminal in Paradip port. The terminal can load these vessels at a rate of 100,000 tonnes a day.
  • By 2022, Odisha plans to reach generation of 2,200 MW of solar power, 200 MW of wind power,180 MW of bio-mass power, 150 MW of small hydro power and 20 MW of Waste-to-Energy (WTE) power.
  • In December 2019, the State Government announced increasing bed capacity in major hospitals including Mother and Child Healthcare Center (MCH).
  • Odisha Cabinet 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 among the top three start-up hubs by 2020.
  • In order to increase employment opportunities in the state, Odisha Government announced plans to invest US$ 28.69 billion in the manufacturing sector to generate nearly three lakh job opportunities by 2020.
  • In June 2020, ArcelorMittal Group announced its plans to invest Rs. 2,000 crore (US$ 283.73 million) in the state to expand its pellet plant at Paradip and increase its production capacity from 6 million tonnes per annum (MTPA) to 12 MTPA.
  • In October 2020, the state government launched 12 different industrial projects with a combined investment of Rs. 8,796.61 crore (US$ 1.20 billion). The projects include 8 MSME and 4 large projects in sectors such as health care, renewable energy, steel, IT, cement, and food processing. These 12 industrial units will generate employment opportunities for 7,090 people in the state
  • In December 2020, the Ministry of Port, Shipping, and Waterways agreed to the Odisha government’s proposal for the riverine port to be developed by the Paradip Port Trust at an investment of Rs. 4,000 crore (US$ 547.46 billion). The project is estimated to generate employment for 6,000 people.

*- Excluding fuel minerals, atomic minerals and minor minerals, ^- till February 2020

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