Page 1 of 78. CHHATTISGARH An Investment Destination

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1 Page 1 of 78 CHHATTISGARH An Investment Destination

2 Page 2 of 78 Chhattisgarh was born on 1 November 2000 as the 26th State of the Unions by seceding from Madhya Pradesh. Raipur is the state capital. The state is characterized by the dominance of a tribal and socially under-privileged population. The state has an area of 135,000 sq. km., consisting of 16 districts. Chhattisgarh is a land locked state sharing borders with six neighbouring states, Madhya Pradesh to the west and northwest, Uttar Pradesh to the north, Jharkhand to the northeast, Orissa to the east, Maharashtra to the southwest and Andhra Pradesh to the southeast. The climate is mainly tropical, humid and sub-humid. Mahanadi is the principal river of the State. The State is divided into three regions, namely, northern region, central plains and southern region. Number of District 16 Total Area (in sq km) 1,35,000 Persons Total Population Males (in million) Females Density of Population (per sq km) 189 Sex Ratio (females per 1000 males) Literacy Rate (%) 991 Persons Males Females Hindu 96 Religious Population (%) Muslims, Christian, Buddhists, Sikhs, Jains & others 4 Decennial Growth Rate (%) ( ) Meteorological Data Temperature (Summer) Temperature (Winter) C C

3 Page 3 of 78 Chhattisgarh - Socio-Economic Profile The population of Chhattisgarh is million (2.11 percent of India) as per the Census Scheduled Tribes (ST) and Scheduled Castes (SC) constitute 43.4 percent of the State s population. 80 percent of the total population lives in rural areas and the remaining 20 percent lives in urban areas.40 percent of the State is under forest area. The State s Human Development Index is as per the United Nations Development Program (UNDP-2006). The literacy rate has improved steadily from percent in 1991 to 64.7 percent in 2001 to in Economic Performance Chhattisgarh Particulars Financial Year Gross State Domestic Product (GSDP) (US$ billion) Per Capita Income (US$) Growth of GSDP over previous year (%) The State's per capita income, which is an important economic indicator of development of a State was US$ 766 (INR 34,483) during which increased to US$ 856 (INR 38,534) in and further improved to US$ 979 (INR 44,097) in As per the quick estimates for at current prices, Gross State Domestic Product (GSDP) is estimated at US$ billion (INR 95,204 crore), which has registered a growth of percent over previous year i.e The GSDP at current prices is likely to be US$ billion (INR 1,07,847 crore) in as per the advance estimation that shows percent growth over the previous year. The GSDP at current price is likely to be US$ billion (INR 1,29,718 crore) in showing an improvement in the economy as compared to the last fiscal year. (Source: (Source:

4 Page 4 of 78 Distribution Pattern of GSDP In , the secondary sector contributed the highest to Chhattisgarh s GSDP at 40 percent which was followed by the tertiary sector, contributing 32.8 percent and the primary sector at 27.2 percent. The secondary sector had the highest growth rate of all three sectors in the period between and (21.1 per cent). The secondary sector s growth was driven primarily by the cement, iron and steel, and power sectors. Advantages of Investment in Chhattisgarh Mineral Resources Mineral resources are Chhattisgarh s biggest strength. It has deposits of limestone, ironore, copper, rock phosphate, manganese, bauxite, coal, asbestos and mica. The State accounts for about 17 percent of the nation s coal reserves. The State also has proven diamond reserves along with potential gold reserves. Policy and Fiscal Incentives The State offers a wide range of fiscal and policy incentives for businesses under its new Industrial Policy ( ). Additionally, the State has well-drafted policies for the IT/ITeS, minerals and energy sectors. Surplus Power Chhattisgarh presently is one of the few states that have surplus power. It is also among the few profitable states in terms of utility-based electricity. Presence of coal makes Chhattisgarh an ideal location for setting up pit head-based thermal power plants for both, merchant sales and state consumption. Rich Labour Pool The State has a high worker-participation rate (male and female) and most of the labour force is in the 15 to 39 years of age group. It also has one of the lowest losses in terms of man-days attributed to labour problems in the country.

5 Page 5 of 78 Investment made in Chhattisgarh Chhattisgarh is fast evolving as a lucrative investment destination with sectors like power, mining and minerals, sponge iron and steel, IT and ITeS, biotechnology, food processing, gems and jewellery becoming key investment drivers. During an event on 31 st May 2011, organized by Associated Chambers of Commerce and Industry of India (ASSOCHAM) in partnership with the State government, where more than 300 potential investors participate in the Chhattisgarh, it is being estimated by the ASSOCHAM officials, that Memorandum of Understanding (MoUs) worth over US$ 1.55 billion (INR 7,000 crore) was signed. Investment in sector includes like power, cement plant, education, tourism / amusement parks, information technology and IT enable services (ITeS) and revival of sick industries. In 2010 the State has attracted both domestic and foreign investment worth US$ billion (INR 2.86 lakhs crore). The State has emerged as a lucrative investment hub among its competing states. The investment flow into the State has increased significantly in the past five years. The proposed investments in the State in 2006 was around US$ billion (INR 1.08 lakh crore) which increased by almost US$ billion (INR 1.80 lakh crore) in At present the State needs to meet requirements of congenial incentive policy and robust infrastructure to support the investment flow. Chhattisgarh attracted foreign direct investments in power, manufacturing, services, mining and construction sectors. The power sector attracted highest Foreign Direct Investment (FDI) of around 70 percent of total foreign fund inflow. The manufacturing sector garnered a share of 25 percent. Services (2.7 percent) and mining (2.1 percent) sectors attracted almost an equal share of FDI where as construction sector has attracted 0.3 percent of FDI. Chhattisgarh has attracted considerable Foreign Direct Investment, such as the Greenfield coal-based power generation plant by US based AES Corporation at a cost of $1.22 billion. Investment in infrastructure and industrial projects has also been forthcoming from Indian business houses. The Vedanta Group, BALCO and The Tata Power Company have made investments worth US$ 4.44 billion (INR 20,000 crore) in steel, aluminium and power generation. The State is actively pursuing the bio-diesel project from Jatropha plantations. With the joint effort of both the government and other agencies, the State is steadily getting the entire new look. The main thrust of the State government is on the complete

6 Page 6 of 78 infrastructure of the state, which includes roads, hospitals, hotels, office apartments, residential flats and public utility spaces like parks. While the State administration is based in Raipur, a new capital for Chhattisgarh at an investment of US$ 8.88 billion (INR 40,000 crore) on an area of 36,000 hectares to accommodate 5.4 lakh people is being planned. In the first phase of the project to be completed by 2011, ambitious commercial and residential projects shall be executed. An IT Park, a township with a golf course, a capitol complex and a five-star hotel shall be developed by IL & FS Infrastructure Development Corporation, the partners and advisors to the project. The other developments include state of the art infrastructure like four lane roads with dedicated bus lanes, sports complex, logistics hub and a convention centre. The second and third phases of the city shall be completed by 2021 and Exports in Chhattisgarh As per the available statistics, Chhattisgarh registered exports worth US$ 644 million dollars during as against US$ 554 million dollars in , registering a steady growth of 16 percent over the previous year. According to Associated Chambers of Commerce and Industry of India (ASSOCHAM) analysis, the State registered a staggering growth of around 164 per cent in exports in from increasing from US$ 93 million dollars in to US$ 242 million dollars in percent of the companies in the State are engaged in exports and major products exported include rice, cement, steel and forest products. The most favored port is Vishakhapatnam in the State of Andhra Pradesh as the logistics cost incurred elsewhere is much higher. Vishakhapatnam port is followed by Paradip port in Orissa and Nava Sheva port in Maharashtra. 83 percent of the companies in Chhattisgarh sell their products in the domestic market. However, it has been observed that many companies book their products for export through other states. The opening up and operation of services of the Raipur Inland Container Depot (ICD) may reverse the trend of booking exports from other States. The volume of exports, value of exports and new orders are all showing a favourable upward trend, and are expected to register higher growth in the future. Nearly 75 percent of exports emanate from Bhilai and the remaining from Urla, Bhanpuri, Sirgitti, etc. Major exportable products include steel, handicrafts, handlooms, blended yarn, food/agri products, iron, aluminium, cement, minerals and engineering products.

7 Page 7 of 78 Key Industrial Centres Raipur Region Rich reserves of minerals, limestone, and coal have made Raipur district one of the key industrial centres in the State. Raipur city is also the State capital and the government proposes to develop the city into a new world-class capital city. Raipur has 58 large and middle scale industries with prominent players such as Monnet Ispat, Century Cement, Lafarge and Ambuja Cement. Durg-Bhilai Region The Durg-Bhilai region is rich in mineral deposits especially iron-ore, limestone and quartzite. The region is well connected by road and is just 50 km away from the Mana airport at Raipur. Major players located in the region include Bhilai Steel, Steel Authority of India (SAIL) and Associated Cement Company (ACC). The Borai Industrial Growth Centre spread over 397 hectares is also in this region. Bilaspur Region Bilaspur is a prominent industrial centre in Chhattisgarh.The district has a total population of 1.7 million. The presence of South Eastern Coalfields Limited in the region has ensured thriving operations for ancillary industrial units in the area. National Thermal Power Corporation (NTPC) is building the State's largest thermal power plant at Sipat in Bilaspur district. The Sirgitti Industrial Growth Centre spread over 338 hectares is located in this region. Bilaspur is also the divisional headquarters for South Eastern Central Railways. Bilaspur's railway division is one of the most profitable in India, contributing about 17 percent of the revenues of the Indian Railways. Korba Region Korba district is known as the Electricity Capital of India. The region has rich reserves of coal and bauxite. It is connected to Bilaspur, the divisional headquarter for South-Eastern Central Railways by rail. It is about 200 km from Mana airport in Raipur. Major industries present in the region include mining (coal and bauxite), electricity generation and aluminum production.

8 Priority Sectors - Chhattisgarh: Page 8 of 78 Automobile, auto components, spares and cycle industries Manufacturing of plant, machinery and engineering spares Downstream products based on aluminium Food Processing Industries (industries approved for subsidy/assistance from GoI) Milk chilling plant and branded dairy products Pharmaceutical industries White Goods and Electronic Consumer Products Power Generation from non-conventional sources Information Technology, Biotechnology and advanced technology industry. Processing of medicinal, aromatic and dye plants. Key Industries in Chhattisgarh The natural resources, policy incentives and infrastructure in the State support investments in the iron and steel, cement and power sectors. Chhattisgarh is among the richest Indian States in terms of mineral wealth, with 28 varieties of major minerals, including diamonds. Almost 80 percent of the population is dependent on agriculture or agriculture-related occupations. Until 2007, 106 large/medium industries were established in the State, with a fixed investment of around US$ 1.2 billion. From April to October 2007, 332 micro and small industries were established with an investment of around US$ 21 million. Chhattisgarh is making significant investments in industrial infrastructure. The Chhattisgarh Industrial Development Corporation (CIDC) has set up industrial growth centres, industrial parks and integrated infrastructure development centres (IIDC). The State is also in the process of setting up related and specific special economic zones (SEZ).

9 Page 9 of 78 Chhattisgarh to set up 11 Industrial Parks The Chhattisgarh government through its nodal agency, the Chhattisgarh State Industrial Development Corporation (CSIDC) will set up 11 industrial parks in various cities across the State for different sectors. The sectors include gems and jewellery, herbal and medicine, food processing, metal, apparel, aluminium, plastic, gramodyog (village industry), pharmaceutical and so on. The work for the gems and jewellery park to be set up in the proposed new capital complex has started on a piece of land measuring 28 hectares and the preliminary works for four parks are in the process while for the remaining ones, the CSIDC is yet to finalize the land and place. Besides Raipur, the proposed industrial parks would come up in Bilaspur, Bhilai, Korba and Bastar. The CSIDC has started the process to identify the land and complete the formalities. The aluminium park will come up in Korba, where the Vedanta-controlled Bharat Aluminium Company Limited (Balco) has a major facility. The herbal-medical park would be set up in Banjari village of Dhamtari district while food-processing park would come up in Rajnandgaon district. The CSIDC would acquire 121 hectares for the food processing park that would come up under Public Private Partnership (PPP) model. Investments and Foreign Direct Investment (FDI) Inflows According to the Reserve Bank of India, FDI inflows from April 2000 to May 2010 amounted to US$ 206 million. (The figure includes FDI into Madhya Pradesh) As of March 2010, the outstanding investments in the State were US$ 85.8 billion. The bulk of the investments were in the electricity (68.9 percent) and manufacturing (26.0 percent) sectors. Source: Department of Industrial Policy & Promotion

10 Page 10 of 78 Physical Infrastructure Chhattisgarh Railways Railways have an important role in the industrial development of Chhattisgarh as they to transport large quantities of coal, iron ore, and other minerals within and outside the State. Recognizing the potential for mining and metal industry related traffic in the State the Indian railways have established a new railway zone named South East Central Railway with its headquarters at Bilaspur in Chhattisgarh. The on going new projects will improve Chhattisgarh s integration with the national railways system and enhance the competitiveness of industries located in Chhattisgarh. Chhattisgarh to have new rail link Indian Railways, Chhattisgarh State Government, National Mineral Development Corporation (NMDC) and Steel Authority of India Limited (SAIL) have signed a Memorandum of Understanding (MoU) to construct a 235-km rail link from Dalli- Rajhara to Jagdalpur via Rowghat. The rail link, a project that was visualize in rail budget, would provide connectivity to both Rowghat and Bailadila iron ore mines. The project cost, estimated at US$ million (INR crore) (at price level) and likely to be revised upwards, would be shared by SAIL, NMDC, Indian Railways and Chhattisgarh government. The project would be undertaken in two phases. Phase-I is a 95-km rail link from Dalli- Rajhara to Rowghat whereas Phase-II is 140 km from Rowghat to Jagdalpur. SAIL will bear the entire cost of US$ million (INR 304 crore) for Phase-I. With the Phase-I completion, SAIL can access iron ore for its Bhilai steel plant from Rowghat. At present, land acquisition for the Phase-I project is going on and SAIL has already deposited US$ million (INR 53.5 crore) with Indian Railways. Phase-II will cost US$ million (INR crore), which will be shared by Indian Railways US$ million (INR 376 crore), SAIL US$ million (INR crore), Chhattisgarh government US$ million (Rs 76.3 crore) and NMDC US$ million (Rs 70.7 crore). The process of land acquisition for the Phase-I has already begun.

11 Page 11 of 78 The cost of constructing railway lines (Phase I) and creating other rail-related facilities for Rowghat iron ore mines project has already shot up from the original US$ million (INR 304 crore) to more than US$ million (INR 650 crore). The targeted date of completion of the project is December It is being estimated by experts that on completion, the rail network is to transport about 14 million tons of iron ore annually from the mines to Bhilai Steel Plant. (Source: (Source: Aviation The State has two airports and seven airstrips one commercial domestic airport at Raipur and an airport at Bilaspur; and air strips at Bhilai, Korba, Raigarh, Jagdalpur, Ambikapur, Jashpur Nagar and Sarangarh. Road Chhattisgarh has a developed its physical infrastructure to attract the attention of domestic as well as foreign investors. Transport has been given immense focus. The State has nearly 2,225 kilometers of national highway, 3,438 kilometers of major district roads, and 4,814 kilometers of other district village roads in the State. The large road network spreading in the State is a strong factor for attracting huge investment in the State. It was reported in August 2005,the Chhattisgarh government is working on road projects worth about US$ million (INR 3,000 crore). The projects will include upgradation of the State highways and improvement of the district-level connectivity with US$ million (INR 1,000 crore) assistance from the Asian Development Bank. The first phase of the work will cover 800 km and the second phase 900 km. A sum of US$ million (INR 670 crore) would be spent out of the State Budget on various road projects and an additional US$ million (INR 750 crore) under the Prime Minister's Road Development Programme. An additional US$ million (INR 200 crore) being provided by the Central Government would be used to improve road connectivity in tribal areas. Apart from the above there are at least four projects under National Highway Development Programme (NHDP) were in various stages of implementation on Build, Operate and Transfer (BOT) basis. The number of National Highways in the State has increased from 3 to 11, totaling 2,225 km. Chhattisgarh has a total road network of

12 Page 12 of 78 36,324 km, comprising 2,225 km of National Highways, 3,113 km of State highways and the remaining other kinds roads. The vision of the government is to convert all National Highways passing through the State into four-lane network and to connect all villages, mainly by way of public-private partnership. (Source: Approval of Four Lane Road Project on National Highway 6 The Chhattisgarh government has approved the four-lane road project (150 km long Chhattisgarh / Orissa Border Auranga Section on National Highway-6). The total project cost is estimated to be US$ million (INR 1,548 crore) under Design, Build, Finance, Operate and Transfer (DBFOT) pattern. The concession period is 28 years including construction period of 30 months. (Source: ADB - Loan of US$ million (INR 1500 crore) for Road Infrastructure The Asian Development Bank (ADB) will provide US$ million (INR 1,500 crore) loan to Chhattisgarh government for developing road infrastructure in the State, which is likely to be commence by December Under the project, the State plans to develop 1,500 km of roads. The department officials said that the project was estimated to cost US$ million (INR 2,250 crore). Of it, US$ million (INR 1,500 crore) would be provided by the ADB as loan while remaining US$ million (INR 750 crore) would be the invested by the Chhattisgarh government. The State government had earlier developed 300 km road between Maanpur and Bilaspur with the aid provided by the ADB. The project has been completed. (Source: SAIL funds Road Project in Chhattisgarh India's largest steel maker in the public sector, Steel Authority of India Ltd (SAIL), has contributed US$ 1.61 million (INR.7.26 crore) to Chhattisgarh government for construction of a km concrete road in Kanker district's extreme interior. SAIL has got a lease to mine iron ore for a period of 20 years in the district. (Source:

13 Page 13 of 78 Industrial Infrastructure - Chhattisgarh Industrial Infrastructure Industrial Parks (ongoing projects) Type District Size Investment requirement (US$ million) Aluminium /Metal Park Raipur ha NA Integrated Textile Park Bhanpuri, Raipur 8.0 acres 5.0* Medicinal Park Dhamtari acres 13.5 Food Processing Park Rajnandgaon acres 6.7* Integrated Infrastructure Development Centres (IIDCs) Growth Centres (established) Engineering Park Bhilai acres 4.3 Tifra (Bilaspur), Shyamtarai (Dhamtari), Teknar (Dantewada), Kapan (Janjgir-Champa) All between Ha Siltara Raipur 1.3 Ha Borai Durg Ha 37.4 Urla Raipur Ha Sirgitti Bilaspur Ha 21.7 Large Industrial Areas (new projects) Bilaspur 791 Ha 12.5 Raipur 2,483 Ha 37.3 Raigarh 1,466 Ha 19.3 Sources: Economic Survey, , CSIDC website *PPP mode

14 Page 14 of 78 Special Economic Zones and Industrial Clusters As of June 2010, the State had two formally approved SEZs. The State has important industrial areas in Bhilai, which is home to iron and steel ancillary units, and Korba, which is home to well known companies in the power and aluminium sectors. Industry Location SEZ(No) SEZs with Formal Approval: IT/ITeS Naya Raipur 1 Solar Rajnandgaon 1 SEZs with In-Principle Approval Gems and jewellery Raipur 1 Multi-product Raipur 1 Source: sezindia.nic.in, as of June 2010 Major Investments in the Infrastructure Sector As of March 2010, more than US$ 21.6 billion of investments have been made in strengthening Chhattisgarh s infrastructure. Over 90 percent of the investments in infrastructure have been made in the area of power generation. Investments Infrastructure Type (US$ million) Power Generation 19, Coal and Lignite 658 Crude Oil and Natural Gas Minerals Railways Total 21, Source: CMIE As of March 2010

15 Page 15 of 78 Educational Infrastructure More than 81,658 students study in the 139 government colleges in the State. There are 16 engineering colleges, 12 polytechnic institutes, 88 Industrial Training Institutes, 8 private pharmacy colleges and 3 medical colleges in the State. Chhattisgarh has 8 deemed universities and 29 colleges for professional education. Chhattisgarh's social performance (as measured by the Human Development Index in 2001) shows that certain parts of the State (Durg 0.62, Raipur 0.56 and Korba 0.56) have a better-developed social infrastructure as compared to other districts in the State. This may be attributed to industrialization and a better infrastructure network in these regions. th As reported on 16 Dec 2010, Chhattisgarh has launch US$ 5.77 million (INR 260 million) infrastruture project. The investment will be mainly for constructions of roads and school buildings in one of the worst Maoist-hit districts, Narayanpur, in Bastar region. (Source : (Sources: Socio Economic Survey, ; Annual report Ministry of Human Resource Development, GoI) Health Infrastructure in Chhattisgarh There are 721 primary health centers and 4,741 sub-health centers in the State. The number of institutions offering Indian systems of medicine per lakh of population is about districts in the State have blood bank facilities. Source: Chhattisgarh At a Glance, 2007, Directorate of Economics and Statistics INFRASTRUCTURE STATUS Chhattisgarh

16 Page 16 of 78 Growing Rate of Urban Infrastructure The rate of urbanization in the State is 17.4 percent as against the national average of 28.5 percent, with 10 municipal corporations and 28 municipalities (as of 2007). Maharashtra s City and Industrial Development Corporation (CIDCO) has been appointed as the advisor for the Capital City Project to upgrade Raipur to Naya Raipur at a cost of US$ 450 million, with projects that include the following: A water supply project for meeting the requirements of an estimated population of 2.5 million by 2031 is being planned. A transportation hub is being created in the city. Naya Raipur will be the fourth planned city after Chandigarh, Gandhinagar and Bhubaneswar. Planned over 8,000 hectares, of which 30 percent is to be used for residential and economic purposes, Naya Raipur will house a population of 450,000 within a decade. Central allocations worth US$ 41.8 million have been made to Chhattisgarh under the Urban Integrated Development of Small and Medium Towns (UIDSSMT) and the Accelerated Urban Water Supply Program (AUWSP) from 2000 to Naya Raipur Development Authority (NRDA) has been set up as the nodal agency for comprehensive development of the greenfield city.

17 Page 17 of 78 Business opportunities in various sectors in Chhattisgarh Power Scenario at Chhattisgarh Of the total installed capacity of 4,769.5 MW in , coal or thermal-based plants accounted for 93 percent, hydel power for 3 per cent, while the remaining was on account of renewable energy sources. Over 85 percent of private sector power capacity and over 93 percent of State owned power capacity are coal-based power plants. Korba in Chhattisgarh is termed the Power Capital of India with National Thermal Power Corporation (NTPC) s Super Thermal Power Plant working at 90 percent Plant Load Factor (PLF). The State has huge coal reserves at 84 percent of India s coal reserve. The Hasdeo Bango reservoir offers cheap power generation opportunities. For 2009, Chhattisgarh has earmarked expenses worth US$ 758 million for revamping power transformers in the State. Chhattisgarh State Electricity Board (CSEB) is a profit-making State Electricity Board (SEB), supplying 54 percent of power; while 36 percent power comes from the private sector. Power Investment Scenario On Feb 2008, power developers have made an investment commitment worth US$ billion (INR 1,58,000 crore). This will help add 39,500 MW through 40 power projects. These projects will be executed phase-wise in the next eight years. It will make Chhattisgarh as one of the power hubs in India. Of the proposed 40 projects, the Chhattisgarh State Electricity Board (CSEB) on February 2008 signed Memorandum of Understanding (MoUs) for 16 projects with a combined generation capacity of 11,680 MW with an investment of US$ billion (INR 47,000 crore). According to the Chairman of the CSEB they have assured the power developers, coal linkage, land and water. The State is rich in coal reserves, which can generate 1,00,000 MW for the next 50 years. For generating 1,000 MW, 5.2 million tonne of coal will be required annually. Developers, who already have coal linkage, would be permitted to sell

18 Page 18 of percent of the power outside Chhattisgarh. However, the power developers who have received captive coal blocks they will be entitled to sell 62.5 percent power outside the State and the balance to the CSEB. Of the 40 projects, some of the projects include Jindal Power Ltd (1,260 MW), JSW Energy (1,100 MW), Jindal India Thermal Power (1,100 MW), Videocon (1,100 MW), Chambal Infra Ventures (1,100 MW), Jain Energy (1,100 MW), Essar Power (1,050 MW), GMR Energy (1,000 MW), Tata Power (1,000 MW), Bhushan Energy (1,000 MW), Prakash Industries, KVK Energy and Infrastructure Ltd, Sona Power Ltd and Shyam Century Ferrous Ltd (600 MW each), Surya Prakash Power and Singhal Energy (270 MW each), Spectrum Coal and Power Ltd (100 MW), K Energy Power Ltd (30 MW). (Source: On-Going Power Project GMR Chhattisgarh Power Project GMR Energy has signed a Project Implementation Agreement with the Government of Chhattisgarh for implementation, operation and maintenance of a 1,200 MW coal based, thermal power plant in Chhattisgarh (Raipur) on Build, Own and Operate basis for 40 years and the project is likely to be completed by (Source: VISA Power Project VISA Power has inked an Memorandum of Understating with the Government of Chhattisgarh in 2007 for setting up of a 1,200 MW (2X600MW) coal based independent power plant near Deveri and Dumarpali, roughly 16 kms west of Raigarh town. The plant site is allotted million MT of coal from Fatehpur East Coal Block and estimated cost of the project is US$ 1.38 billion (INR 6200 crore). The project is likely to be commissioned by 2013.(Source: NTPC - The largest power producing company, is developing a coalmine in Raigarh district besides a proposed 4,000-MW power project near Lara in the same district of Chhattisgarh.The NTPC is coming up with 2,960-MW power projects in Sipat of Bilaspur district in the State IFFCO Plan for Power Project The Power Project is a joint venture between Indian Farmers Fertilizer Cooperative Ltd (IFFCO) Chhattisgarh Power LTD (ICPL) and Chhattisgarh State Electricity Board

19 Page 19 of 78 (CSEB) and the project is expected to be commissioned by 2015.The 1,320 MW coal based power plant will be coming up at Salka village in the Sarguja district of Chhattisgarh.The project has received forest and environment ministry clearance (Source: Bhaiyathan Thermal Power Project Indiabulls CSEB Bhaiyathan Power Limited (ICBPL), a subsidiary of the Indiabulls Group Company Indiabulls Power Limited. (IPL), is developing a 1,320 MW coal-fired thermal power project at Bhaiyathan in the State of Chhattisgarh. The Bhaiyathan Power Project is being developed through a Public Private Partnership (PPP) model with the Chhattisgarh State Electricity Board (CSEB). The Company was awarded to Build, Own and Operate (BOT) and maintain this Bhaiyathan project through a competitive bidding process. ICBPL and CSEB have entered into a long-term Power Purchase Agreement (PPA) dated October 13, 2008 for the sale of 65 percent of power that will be generated by the Bhaiyathan Power Project aggregating approximately to 858 MW of electricity. The Power Purchase Agreement (PPA) is for a term of 25 years from the date of commencement of commercial operation of the power project. ICBPL proposes to sell the remaining power capacity on merchant basis. The Project has got almost all the statutory regulatory approvals for the project. (Source: Jindal Power Limited After completing and commissioning the 1,000 MW Thermal Power Plant in Raigarh (Chhattisgarh) the company now deeply involve in setting up a 2,400 MW (4x600 MW) power project with an investment of US$ 2.98 billion (INR 13,410 crore) in Chhattisgarh. The project is expected to be completed by (Source: KSK Power Venture Plc The Indian unit of London based KSK Power Venture Plc, KSK Energy Ventures Ltd is developing its KSK Mahanadi Power Project in Chhattisgarh where the total fund required for the project is US$ 3.6 billion, of which $2.88 billion debt is being funded by 27 banks and financial institutions and the balance from other sources. KSK Energy Ventures have already started civil works at the power unit after it obtained clearance from the ministry of environment. China-based Shandong Electric Power Construction Corp (SEPCO) is involved with the design, supply and project engineering, construction, commissioning and testing services for the site.(source:

20 Mining Industry - Chhattisgarh Page 20 of 78 Chhattisgarh is the richest state in terms of mineral wealth, with 28 varieties of major minerals, including diamonds. Beside other mineral rich states, Chhattisgarh is one, which has rich deposit of coal, which has led to its 'power hub' strategy. All the tin ore in India is in Chhattisgarh. A fifth of iron ore in the country is contributed by the State and one of the best quality iron ore deposits in the world is found in the Bailadila mines in south Chhattisgarh, from where it is exported to Japan. Rich deposits of Bauxite, Limestone, Dolomite and Corundum are found in the State. The State is fortunate to have large deposits of coal, iron ore and limestone in close proximity, making it the ideal location for the lowest cost of production. There is great scope for private participation in the mining sector in Chhattisgarh. The State s Mineral Policy 2001 has created a conducive business environment to attract private investment in the State, both domestic and international. Procedures have been simplified and there is complete transparency in decision-making. The added advantage is availability of large technically qualified human resources, having trained in tailormade programmes in geology, geophysics, geochemistry, mineral beneficiation, mining engineering and environmental science. The State is ensuring a minimum lease area with secured land rights so that investors can safely commit large resources to mining projects. For surmounting the long-drawn out process of getting mineral-related leases, at the State level, quick processing of applications is given top priority. For major minerals under the Mines and Minerals (Development & Regulation) Act, where approvals are required from Government of India, the State government would help in strong advocacy to get such approvals quickly. The State is also encouraging establishment of a Gems and Jewellery Park to attract new investment in the sector. Chhattisgarh has the right geological set up to host a number of economic mineral deposits. National Mineral Development Corporation (NMDC) is the country s single-largest ironore producer and exporter. It produces more than 28.5 million tonnes of iron-ore from its fully mechanized mines. The company operates two mines at Bailadila in Chhattisgarh. Iron-ore from this region is considered the best for manufacturing steel as it has almost 66 percent super high-grade iron content that is free from sulphur and other deleterious materials. In , the company had revenue of US$ 1.64 billion and an employee base of 5,652. NMDC plans to increase its total iron-ore production capacity to 50 million metric tonnes per annum by It has started expansion of its Bailadila11-B mine by 7 million metric tonnes and at a cost of US$ 132 million. The plant is expected to be commissioned

21 Page 21 of 78 by the end of In 2009, the company also announced plans to set up a 3 million tonnes per annum (MTPA) integrated steel plant in Jagdalpur, Bastardistrict. In early 2010, land was acquired for the proposed plant. Construction is expected to be completed by With the discovery of proterozoic, diamondiferous and kimberlite in Mainpur, Raipur district, which invited global attention. Further kimberlite discoveries in Tokapal, Bastar have added another potential diamond field. Incidence of diamonds is also known from Ib river in Raigarh district. It seems that in the non-coal areas, Chhattisgarh is nestling atop the world s largest kimberlite area. Apart from diamond, four blocks of gold exploration and five blocks for base metal investigation have been demarcated. Deposits of Alexandrite, one of the rarest gemstones, are found in Deobhog area of Raipur. Workable deposits of Corundum are widespread in South Chhattisgarh. Corundum includes semi-precious varieties of Ruby and Blue Sapphire, and possibilities of finding precious varieties exist as well. Other semi-precious minerals like Beryl, Garnet, Amethyst and Rock Crystal are found in other parts of the State. A few major mineral deposits are: (all figures in million tonnes) Particulars Deposit (million tonnes) Coal 41,442 Iron Ore 2,731 Limestone 9,038 Dolomite 847 Bauxite 148 Tin Ore 32 (Source: Source: Mineral Resources Department, Government of Chhattisgarh as of ) The State s Chhattisgarh Mineral Development Corporation (CMDC), singly or in joint venture, undertakes scientific exploration, commercial exploitation and viable trading of minerals in the State. CMDC welcomes partnerships with national and international private sector mineral companies, so that the natural wealth of the State is translated more efficiently into prosperity for its people. For Chhattisgarh, preferred investors will be those that come into the State with a plan to add value with downstream industries, and such investors would have priority in sanctioning of Mining Lease and Prospecting Lease. Those who set up export-oriented mineral based units in the State would be equally preferred investors. All such mining industries will benefit from the incentives offered to all other industries.