Confederation of Indian Industry. Invest North A CII-KPMG study. Rajasthan State Profile. August 2013

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1 Confederation of Indian Industry Invest North 2013 A CII-KPMG study Rajasthan State Profile August 2013

2 Rajasthan: a snapshot Source: Government of Rajasthan;, Find Data website, accessed on 12 August 2013 Rajasthan, a popular tourist destination is the largest state by area in the country with well developed infrastructure facilities. The state is well-known for its rich minerals and related industries, tourism and textiles industries and is also fast growing in automobiles and IT/ITeS. Given the vast potential, 323 industrial areas and 8 growth centres have been developed in the state. In order to facilitate investment, single window clearance mechanism is already operational in the state. 1

3 Rajasthan: a snapshot Overview Geographic and demographic indicators Geographical area (sq km): 342,239 No. of districts: 33 Capital city: Jaipur Key cities: Jaipur, Udaipur, Kota, Jodhpur, Ajmer and Alwar Total population, 2011 census (million): 68.6 Population density, 2011 census (persons per sq km): 201 Literacy rate, 2011 census (percent): 67.1 Economic indicators* GSDP: State GDP recorded a CAGR of 9.2 percent during FY08- FY12 GSDP composition: This has marginally shifted in favor of Services Sector-wise CAGR: Agriculture (7.9 percent), Industry (8.4 percent), Services (10.4 percent) Per capita income: INR28,851 (USD602) in FY12 (latest available) Source: Census 2011 ( 2,500 2,000 1,500 1, ,600 Notes: 1 USD = INR 47.9 *At constant FY05 prices (data as of February 2013) Source: MOSPI GSDP (INR billion)* 2,147 1,745 1,862 2,278 FY08 FY09 FY10 FY11 FY12 GSDP composition (percent)* FY08 FY09 FY10 FY11 FY12 Agriculture Industry Services 2

4 Rajasthan: a snapshot (cont.) Physical infrastructure Installed power capacity, June 2013 (MW) Road length, March 2011 (Km) No. of airports, August 2013 Wireless subscribers, April 2013 (million) Wireline subscribers, April 2013 (million) Units 12, , Investment FDI: INR33.3 billion (USD685 million) during April 2000 to April Note: 1 USD = 48.6 during April 2000-April main airports at Jaipur and Udaipur ; Two civil enclaves at Jodhpur and Jaisalmer Sources: CEA; TRAI; Ministry of Commerce and Industry; Ministry of Road Transport and Highways; Airports Authority of India; Press articles FY09 FY10 FY11 FY12 FY13 3

5 State s sector specific strengths Priority sectors Auto and Auto Components Glass and Ceramics Solar power Petrochemicals IT/ITeS Textiles Agro processing Other sectors Tourism Mineral processing Renewable energy Cement Education Gems and Jewellery Infrastructure and Logistics Handicrafts Biotechnology and Health Financial Services Real estate Retail Source: Government of Rajasthan 4

6 State s sector specific strengths Opportunities: Oil and Gas leading to Petrochemicals Oil and Gas production 8,000 6,000 4,000 5,149 6,553 2, FY08 FY09 FY10 FY11 FY12 Crude oil ('000 tonnes) Natural gas (mcm) Key enablers Source: MoPNG Rising demand, in particular of gas, by power, fertiliser and city gas distribution (CGD) sectors and expected revision in gas prices, is beneficial for investors Favourable policies such as 100 percent FDI in exploration and production and 49 percent in refineries Deregulation of petrol prices and phased deregulation of diesel prices is on lines of industry demand Sources: MoPNG; PPAC; Press articles 5

7 State s sector specific strengths Opportunities: Oil and Gas leading to Petrochemicals (cont.) Sector opportunities Large reserves of oil and gas represent significant opportunity in view of the increased potential for development Share of oil and gas production from the state has increased from NIL to 17.2 percent in case of crude and from 0.8 percent to 1.2 percent in case of gas during FY08-FY12 With increased oil and gas production, opportunities also exist in oil and gas transmission and distribution, underground lignite gasification and coal to liquid conversion plants Throughput of transmission pipelines (product) grew at a CAGR of 8.5 percent during FY08-FY12 The state s 2,572 retail outlets are the 7th highest in India City Gas Distribution (CGD) network is under operation at Kota that is being carried out through over 90 km of distribution pipelines Sources: MoPNG; PPAC; Press articles Rajasthan State Refinery formed joint venture with Hindustan Petroleum Corporation Limited (HPCL) for setting a 9 million tonnes refinery cum petrochemicals units at Barmer at an investment of INR372 billion. It is the second biggest project in the state and will generate 3,00,000 jobs. It is expected to be completed by December 2017 and bring in INR86 trillion of investment Existing companies Oil and Natural Gas Corporation, Cairn India, Indian Oil Corporation, HPCL, GAIL (India) and GAIL Gas among others 6

8 State s sector specific strengths Opportunities Oil and Gas leading to Petrochemicals (cont.) Success stories Cairn India Cairn India, earlier part of UK-based Cairn Energy, and acquired by Vedanta Group in 2011, is engaged in exploration, production and transmission of hydrocarbons Company has developed several oil and gas fields such as Mangala, Bhagyam and Aishwarya (Rajasthan), Ravva (Andhra Pradesh) and Lakshmi (Gujarat) Well known for its oil discoveries in Rajasthan and Mangala Development Pipeline (world s longest continuously heated pipeline) Plans on investing USD3 billion till FY16 for boosting oil and gas production in India. Over 80 percent of this amount will be spent on Rajasthan s Barmer block GAIL Gas Incorporated in 2008, as a wholly-owned subsidiary of GAIL (India) Limited, GAIL Gas is responsible for carrying out city gas distribution (CGD) business in India It is authorized to distribute gas in six areas including Kota (Rajasthan). Kota network includes 39 Km steel pipeline, 53 Km polyethylene pipeline, one CNG station, one daughter station; 2,734 registered households; 31 gas sales agreements (industries: 22; commercial: 9) Sources: Company websites 7

9 State s sector specific strengths Opportunities Solar power Key enablers Average per day solar incidence of 5-7 kwh/sq m translating into 1,600-2,000 kwh/sq m of power generation. Regions with high solar radiation include Bikaner, Barmer, Jodhpur and Jaisalmer Total installed capacity and generation in Rajasthan* Rising demand for power Rajasthan accounts for 81 percent of grid-connected scheme under National Solar Mission. Highest no. (12) of 1 MW projects as per Rooftop and Small Solar Generation Programme Developing technology translating into lower cost Favorable policies (10 year investment subsidy to the tune of 30 percent of tax deposited; exemption for 7 years from electricity duty, land tax, mandi fee to the extent of 50 percent) 0 FY11 FY12 FY13 Capacity (MW) Generation (BU) Note: MW denotes Mega Watt; BU denotes billion units * Includes thermal, hydro, nuclear etc. Source: CEA Government schemes of renewable purchase obligation, renewable energy certificates Single window clearance mechanism 0 The state government improved the bidding process last year, wherein projects were allocated under reverse bidding and power purchase agreements were to be signed with Rajasthan Renewable Energy Corporation Ltd. Sources: Government of Rajasthan; Press articles Endowed with minerals: Close to 99 percent of India s zinc concentrates lie here (used in solar structures galvanization). Rich in other minerals, such as quartz, and salt required in Concentrating Solar Power (CSP) technology 8

10 State s sector specific strengths Opportunities Solar power (cont.) Sector opportunities Rajasthan has the highest installed solar power capacity in the northern region of 442 MW. This capacity accounts for a share of 92.3 percent in northern region s solar power capacity and of 31 percent of total installed solar power capacity in India, as of March 2013 Immense solar power potential presents opportunities for: Generation companies Transmission and distribution companies Equipment manufacturing or leasing companies Engineering, procurement and construction (EPC) companies Solar wafer manufacturers Opportunities also exist for solar-based appliances manufacturers, such as water heaters, solar-based desalination plants and solar pumps State government plans on establishing Solar Energy Enterprise Zones (SEEZ) in Barmer, Jaisalmer and Jodhpur districts and is offering incentives for the same Upcoming solar parks in Jodhpur, Bikaner, Jaisalmer Sources: IREDA, NVVN, State agencies, Project developers; Press articles 9

11 State s sector specific strengths Opportunities Solar power (cont.) Existing companies Reliance Power, Suzlon, Lanco, Welspun Energy, Azure Power, Fortum, Jakson Power Solutions, Ajit Solar, Enercon, Vistas etc. Success stories Lanco Lanco is a diversified business entity with operations ranging from power, solar, infrastructure, natural resources and EPC The company has four solar power plants in India at Rajasthan (Jaisalmer), Chhattisgarh (Rajnandgaon) and two in Gujarat (Bhadrada and Chadiyana) The company has signed several Power Purchase Agreements for these projects in Rajasthan, Gujarat, Chhattisgarh etc. In Rajasthan, the PPA is for 100 MW Besides, Lanco also has operations overseas in Asia-Pacific (China, Singapore, Indonesia) and Europe (Italy, Netherlands) Total income grew from INR33.4 billion in FY08 to INR47.4 billion in FY13 Sources: Press articles; Company website 10

12 State s sector specific strengths Priority sectors Auto and Auto Components More than 100 companies operating in Alwar (Bhiwadi, Neemrana and Pathredi) Original equipment manufacturer (OEM) specific zone created at Kushkhera Several auto units operating in Japanese investment Zone at Neemrana Training centre to be set up by Ministry of Micro, Small and Medium Enterprises 57 percent of auto sales in India take place in northern and western regions, which are in close proximity to Rajasthan Success stories: Ashok Leyland, Honda, Eicher, and Bosch Glass and Ceramics State accounts for 40 percent of clay production and 70 percent of bone China production in India Bikaner, Ganganagar, Nagaur, Bhilwara, Alwar, Udaipur are rich in various minerals such as gypsum, clay and limestone As per Bureau of Investment Promotion, investment proposals >INR50 billion have been received recently in the sector Upcoming Ceramics and Glass zone in Ghiloth of 752 acres with provisions being made for a gas pipeline Opportunities: Industrial ceramics, potteryware, tiles, sanitaryware Success stories: Saint Gobain, Kajaria and JCPL Ceramics Source: Government of Rajasthan 11

13 State s sector specific strengths (cont.) Priority sectors IT/ITeS State departments likely to allocate three percent of budget for IT/ITeS 126 registered Software Technology Parks of India (STPIs) State projects launched that require e-governance solutions Mahindra World City at Jaipur is India s largest IT SEZ; 51 Companies signed MoU for INR13.6 billion; scope for further investment Skilled manpower estimated to cost percent less than that in the national capital region (NCR) Opportunities: Hardware, software, BPO, back-end operations of financial services firms Success stories: Infosys, Wipro and Deutsche Bank Source: Government of Rajasthan 12

14 State s sector specific strengths (cont.) Priority sectors Textiles Largest producer of polyester viscose yarn and synthetic Industry hubs: Balotra, Bhiwadi, Bhilwara, Pali Ministry of Textiles approved 9 parks costing INR15 billion and another INR4 billion as grant under Scheme for Integrated Textile Parks (SITP) Special customized package as approved by Cabinet 10 Smart centers to be developed under Integrated Skill Development Scheme to train and employ 12,000 people Success stories: Shriram Rayons and Ginni International Agro processing Largest producer of oilseeds (rapeseed, mustard). High production of coriander, soybean, groundnut, pulses etc. International Horticulture Innovation and Training Centre established at Jaipur Opportunities: Organic farming, contract farming, cold chains, warehouses, testing and certification facilities Success stories: Australian Wheat Board, ITC, Reliance Source: Government of Rajasthan 13

15 Government identified areas/zones present immense investment opportunities Industrial areas Behror Bhiwadi Ghiloth Neemrana Shahjhanpur Upcoming industrial areas Khushkhera ext. Tapukara ext. Soniyana (Chittor) Kunjbiharipura (Jaipur) Karni ext. (Bikaner) Gajaner (Bikaner) Borananda (Jodhpur) Sources: Government of Rajasthan; Press articles Clusters/hubs Automobile: Bhiwadi Glass and ceramic (upcoming): Ghiloth Textiles (upcoming on PPP mode): Jodhpur, Bhilwara Parks IT: Sitapura, Kota, Jodhpur, Udaipur Textiles: Pali, Bagru, Kishangarh Agro: Alwar, Jodhpur, Sriganganagar, Kota Growth centres Abu Road Bhilwara Bikaner Nagaur Sikar Mini growth centres Baran Bharatpur Bhiwadi Jodhpur Karauli Pali Tonk Udaipur 14

16 Government identified areas/zones present immense investment opportunities (cont.) Neemrana: Japanese Investment Zone I MoU: Neemrana Industrial Estate developed as per MoU between RIICO and Japan External Trade Organization (JETRO) Delhi-Mumbai Industrial Corridor (DMIC): This region to be part of much-talked about DMIC project Investment: INR42 billion invested; expected employment: 9,120 Area: 1,167 acres, of this, close to 494 acres allotted to more than 25 companies (expected investment and employment: more than INR25 billion and 3,000 respectively) Sector presence: Most companies belong to automobile sector Key investments: Daikin (INR6 billion), Mitsui Chemicals (INR4 billion), Mikuni India (INR1.5 billion), NYK Logistics (INR1 billion) ; Nippon Steel (INR3 billion exp) Units in production: 24 (Nissin Brake, Daikin Airconditioning, Mikuni, Nippon, Mytex Polymer etc.) Proposed infrastructure development: Cargo airport between Ajarka and Kotkasim, and super express highway through Neemrana Gaining international attention: African delegation of 25 members from 15 countries and a delegation from Taiwan Electrical and Electronic Manufacturers Association visited Neemrana Rajasthan is the only state in the country to have three international investment zones Sources: Government of Rajasthan; Press articles 15

17 Government identified areas/zones present immense investment opportunities (cont.) Ghiloth: South Korean Investment Zone The investment zone being developed as per MoU signed between the RIICO and Korea Trade Investment Promotion Agency (KOTRA) Approximately 250 acres of land earmarked Automobile and electronic sector companies have evinced greater interest It will house a ceramic and glass hub, solar equipment manufacturing etc. Gas supply being considered by GAIL Area to be operational by 2014 Ghiloth: Japanese Investment Zone The success of Japanese Investment Zone I laid the foundation for Japanese Investment Zone II For the new phase, 500 acres of land will be made available Central sales tax concession being offered to Japanese investors Rajasthan is the only state in the country to have three international investment zones Sources: Government of Rajasthan; Press articles 16

18 Project-wise opportunities Delhi-Mumbai Industrial Corridor Project details Length: 1,483 km States: UP, Delhi, Haryana, Rajasthan, Gujarat and Maharashtra Project implementation: Special Purpose Vehicle, Delhi Mumbai Industrial Corridor Development Corporation Around 40 percent of project areas falls in Rajasthan Objectives: Provide high speed connectivity for high axle load wagons (25 tonnes) of double stacked container trains; create at a global manufacturing and trading hub Investors Government of India (49 percent) Japan Bank for International Cooperation (26 percent) Housing and Urban Development Corporation (19.9 percent) Others include India Infrastructure Finance Company (4.1 percent) and Life Insurance Corporation of India (1 percent) Sources: Government of Rajasthan; DMIC; Press articles 17

19 Project-wise opportunities (cont.) Delhi-Mumbai Industrial Corridor (cont.) First phase of development ( ) Government approved financial assistance of INR25 billion per city for development of Dadri, Noida, Ghaziabad, Manesar, Bawal, Khushkhera, Bhiwadi, Neemrana, Ahmedabad, Dholera Core project areas Industrial areas Jaipur-Dausa Rajsamand-Bhilwara Jodhpur-Pali-Marwar Investment regions Khushkhera-Bhiwadi- Neemrana Ajmer-Kishangarh Second phase of development ( ) First phase of development: Six investment regions and six industrial areas identified for investment Second phase of development: Five investment regions and seven industrial areas identified for investment Expected investment in project s cities: USD billion Development of airports Development of townships: sq km in cities by 2019 Germany has evinced interest for investing in the project Sources: Government of Rajasthan; DMIC; Press articles DMIC s major junctions in Rajasthan Phulera, Marwar, Bangurgram Other areas for development Industrial townships being planned in Khushkhera-Bhiwadi-Neemrana and in Jodhpur-Pali-Marwar regions Greenfield airport, 24 sq km Road corridor to connect Bhiwadi-Tapukara industrial complex with Shahjahanpur- Neemrana-Behror urban complex Jodhpur-Pali-Marwar region to have an airport, multi-modal logistics hub and mass rapid transit system Knowledge city Khushkhera-Bhiwadi-Neemrana 12.3 sq km 18

20 Project-wise opportunities (cont.) Gyanodaya Schools Project Project details Objective: To provide equitable quality education in rural areas Project: Building secondary schools (Class VI-XII) in areas where there is no such school in a 5 km radius Estimated cost: INR6 billion Project bid criterion: Viability Gap Funding (VGF) Project type: PPP on design, build, finance, operate and transfer (DBFOT) basis for 30 years after which, the assets would be transferred to the Government Phase-1 Phase-1 aims at constructing 50 schools in Ajmer (four districts) and Udaipur (six districts) Total investment in Phase-1, comprising 50 schools, has been estimated to be INR2,074 million Source: Press articles Background Government of Rajasthan (GoR) plans to build 165 new senior secondary schools, of which five schools are proposed to be built in each district of Rajasthan on PPP basis Project status As of 31 March 2013, for Phase-1, the applicants have been shortlisted and VGF has been sanctioned by the Government of India (GoI) for the following areas: Ajmer Bhilwara Banswara Chittorgarh Dungarpur Nagaur Pratapgarh Rajsamand Tonk Udaipur The applicants for the remaining schools would be shortlisted in the upcoming phases of the project 19

21 Project-wise opportunities (cont.) Gyanodaya Schools Project (cont.) Indicative project financials Project cost: INR6,000 million (Phase-1: INR2,074 million) Internal rate of return (IRR): percent Average debt service coverage ratio: 2.1 Revenue model Fee from private/open market students would be marketbased Fees of Government-nominated voucher students would be reimbursed by GoR Voucher amounts would be calculated by GoR based on Public Sector Comparator, linked to consumer price index Additional revenues from any supplementary activities undertaken by the school to the operator Fiscal support State Government PPP school land to be provided on a 30 year lease basis to the private partner at nominal lease rent Construction subsidy with a ceiling of INR5 million per school Centre VGF of 20 percent of the project cost GoI approved financial assistance for the project under the India Infrastructure Project Development Fund (IIPDF) Project development entails structuring, financial modelling, bid documents preparation and bidding process assistance. But, no financing support would be provided during the operations Asian Development Bank (ADB) has also provided partial financial support for project development activities 20

22 Project-wise opportunities (cont.) Water supply and sewerage system plants Udaipur Ajmer and Pushkar Estimated cost: INR10 billion Estimated cost: INR7 billion Project type: PPP on DBFOT basis Project type: PPP on DBFOT basis Objective: Rehabilitation, augmentation and operation of the water supply and sewerage system Objective: Rehabilitation, augmentation and operation of the water supply and sewerage system Both projects are currently in the pipeline stage and are being managed by Public Health Engineering Department, Government of Rajasthan Status of the projects: As of 31 March 2013, consultants submitted respective feasibility reports for both projects. Observations on the same communicated. Modified reports are still awaited Source: Press articles 21

23 Project-wise opportunities (cont.) Nine textile parks under SITP Scheme for Integrated Textile Parks (SITP): Aims at facilitating development of Integrated Textiles Parks (ITPs) in India under PPP model In March 2013, Ministry of Textiles started forming a panel of Project Management Consultants for implementing the projects sanctioned under the 12th Five Year Plan Scheme would be implemented through project specific Special Purpose Vehicle (SPV) of the user industry with one project SPV for one park. Each ITP expected to have 50 units GoI s support under the scheme by way of grant or equity would be limited to 40 percent of project cost, which cannot exceed INR400 million. Also, the grant cannot be used to purchase land for the ITP The following textile parks have been approved in Rajasthan under SITP: Jaipur Texweaving Park, Kishangarh Kishangarh Hi-Tech Textile Park, Next Gen Textile Park Pvt. Ltd., Pali Jaipur Integrated Texcraft Park Pvt, Bagru Bharat Fabtex and Corporate Park, Pali Jaipur Kaleen Integrated Textiles Park, Dausa Mewar Industrial Textile Park, Pali Himmanda Integrated Textile Park, Baltora Rajasthan Integrated Apparel City, Tapukara Source: Press articles 22

24 Government initiatives Policies Policies, schemes and reforms There are more than 18 important policies and schemes in the state Textiles Policy 2013: Recently announced policy aims at attracting investment of INR100 billion in five years and generate 100,000 new jobs Agro: State has an Agri-business policy and is already working as per National Food Security Mission Petrochemicals policy: The policy is being discussed in the state RIICO offers more than 20 schemes to investors in hotel and tourism, complex building (commercial and residential), interest rebates, equipment and project finance etc. Reforms State government issued several notifications to amend its Factories Act, key being increase in renewal period to 10 years from five years Power tariffs increased by Rajasthan Electricity Regulatory Commission Incentives Incentives, single window clearance and institutions Incentives provided under Rajasthan Investment Promotion Scheme, 2010 to either new organizations or to existing ones for expansion and modernization during April 2013 to March 2020 Customized packages to improved cost-economics of entities Aims at getting new investment of INR105 billion in seven years; generate 1,00,000 new jobs Single Window System Rajasthan, only state to have an Act on Single Window, Rajasthan Enterprises Single Window Enabling and Clearance Act, 2011 An online application, Single Point Electronic Monitoring and Clearance System has also been introduced Approvals provided in time bound manner Mandatory approval for project investment of >INR10 Institutions Bureau of Investment Promotion Rajasthan State Industrial Development and Investment Corporation (RIICO) Office of the Commissioner of Industries Sources: Government of Rajasthan; RIICO; Press articles 23

25 Government initiatives (cont.) Land availability, identification of investment zones and infrastructure development Land availability Land bank available: Land may be acquired or requested for allotment Conversion of land for industrial use: Revenue Department and Urban Authorities to be approached for rural and urban land Land can also be procured from RIICO Industrial areas where land acquisition in advanced stages: Karoli, Salarpur, Manda, Prahaladpura, Baggad. Land also on offer at Bandapur, Kolila Joga, Dhoomera, Haldina, Devnagar and others Identification of investment zones and bilateral dialogues RIICO has been identifying and developing industrial areas. So far, 323 industrial areas have been developed International Investment Zones have been identified for Japanese and South Korean investors. Discussions being carried with investors from Taiwan, Thailand and Israel Infrastructure development Second highest network of National Highways and still developing Three existing airports and plan for four additional airports Several inland container depots at Bhiwadi, Kota, Jaipur and more Sources: Government of Rajasthan; Press articles 24

26 Growth agenda Proximity to Country s capital city Facilitative policies being formed Strong industrial base Abundant mineral resources that lead to huge export earnings (esp. marble, granite) Land availability is not an issue as land bank is available Excellent road infrastructure with further scope for expansion; a metro link underway at Jaipur Presence of 466 higher educational institutions/polytechnics with intake of 1,21,381 Availability of skilled labor backed by almost negligible strikes, lock-outs etc. Labor cost is percent lower Challenges Diverse investment opportunities in sectors Proven track record of present companies Access to large market (Population of border states, Gujarat, Madhya Pradesh, Uttar Pradesh, Haryana, Punjab is 402 million) Power deficit: The state claims to be power surplus by FY14 end Connectivity to hinterland: Few flights operate from the capital city, while most other cities lack airports. Four new airports to be built by Airports Authority of India. In addition, road and rail network being constructed Sources: Press search 25

27 Annexure

28 Policies and schemes for priority sectors I Rajasthan Textile Policy, 2013 Customized package offered to new/existing units (undergoing modernization/ expansion/diversification upto 31 March 2020 Minimum investment: INR2.5 million Direct employment: Atleast 10 people; atleast 25 percent in case of expansion/ diversification with minimum cap of 10 people Interest subsidy at the rate of 5 percent per annum: Additional subsidy at the rate of 1 percent for fixed capital investment of more than INR250 million; Exemption at the rate of 7 percent for textiles Reimbursement of VAT: Reimbursement of 60 percent on yarn purchase Exemptions: 100 percent on luxury tax for seven years; 50 percent on electricity duty, land tax, mandi fee for seven years; 50 percent on stamp duty and land use conversion charge II Rajasthan Industrial and Investment Promotion Policy, 2010 Focused on improving business environment, infrastructure, skills, employment generation, land availability and supporting MSMEs III Rajasthan Investment Promotion Scheme, 2010 (RIPS) Investment subsidy: Upto 50 percent of VAT, GST, CST for seven years Exemptions: 50 percent on electricity duty, land tax and land use conversion charge IV Special Incentive Package for Ceramic & Glass Sector, 2011 Package to be granted for minimum investment of INR500 million Subsidy to the extent of 75 percent of tax paid V Rajasthan Solar Energy Policy, 2011 Exemption from electricity duty to power producers for own consumption; solar park development of more than 100 MW; utility grid power projects for captive use to third party; land for solar power to be allotted at concession of 10 percent to District Level Committee rate Sources: Government of Rajasthan; Bureau of Investment Promotion 27

29 Policies and schemes for priority sectors (cont.) VI Rajasthan Mineral Policy, 2011 Mining lease will be mortgaged in favor of financial institution Procedures pertaining to transfer of leases, period or transfer of lease simplified VII Policy for Promotion of Agro-processing & Agri-business, 2010 Benefits as per RIPS. In addition, employment incentive at the rate of INR4,000 per employee for 3 years; stamp duty concession for food parks; subsidy on tariffs for exports VIII Rajasthan Incentive Scheme for BPO Centres & KPO Centres, 2011 Scheme applicable from issuance date to March 2018; 50 percent subsidy on capital investment for projects upto INR2 million per BPO/KPO centre IX IT & ITeS Policy, 2007 Incentives as per RIPS; VAT at the rate of 4 percent; mega projects and MSMEs to get special package of incentives; rebate in government land; development of IT Parks; Mega projects defined as direct employment of 500 in IT and 1,000 in ITeS Source: Government of Rajasthan 28

30 The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. The views and opinions expressed herein are those of the interviewees and do not necessarily represent the views and opinions of KPMG in India. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation KPMG Global Services Private Limited, a company incorporated under the laws of India and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. The KPMG name, logo and cutting through complexity are registered trademarks or trademarks of KPMG International.