Monday, August 11, 2008

An investor friendly approach!

IIPM Ranked No. 1 B-School In Global Exposre - Zee...

An investor friendly approach!

It’s the ease in legalities which facilitates investments in the state
Nilesh Shukla, Dy. Director of Information, Office of the Resident Commissioner, Government of Gujarat

"Gujarat, the land of businessmen doesn’t need any introduction. It’s said that if you want to make money, go and learn it from Gujaratis. But then, apart from that what is it that makes it a favourite destination among those seeking a fortune..."

Ratan Tata once said that only a fool will not invest in Gujarat. To some extent he was right. Today, Gujarat is well known as an ‘Investors Destination’, not only in the country but also in the world. Even the Chief Minister of State, Mr. Narendra Modi holds similar views as he fondly exclaims, “If you want to make money, come to Gujarat and if you want to waste it, you can go anywhere else.”

So, what is it that makes Gujarat a popular destination among investors? After all why this state attracts industrialists more than anyone else does? Well! There is more than one reason for it. But, before giving any of them, I would like to share two simple facts here.

Firstly, anywhere in India, when children grow up, their parents teach them alphabets but in Gujarat they teach them arithmetic which proves that Gujaratis are business minded people and entrepreneurship is in their blood. Secondly, it is the ease in government legalities which facilitates investments in the state. For this I would like to share an interesting instance. Just few months back, one industrialist who wished to establish a venture in Gujarat made a provision of Rs.5 to 6 crores to get clearance for his files and documents from the government. But his experience was totally different. Not a single penny was spent by him for it and he got all the clearance in time. He wondered, “Is it possible anywhere else across the country?” This young industrialist from northern India was extremely impressed by the government’s positive approach.

Thus, the primary reason for Gujarat becoming the hub for corporate investments is its liberalised thinking and adopting ‘single window procedure’. This helps it in reducing the barriers of trade and simultaneously increasing business in the state.

Gujarat leads the nation in special economic zones (SEZs), chemicals & petrochemicals, pharmaceuticals, textiles & apparels, power, ports et al. During the last ‘Investors’ Summit’ a total of 363 MoUs were signed amounting to Rs.4.61 lakh crores. Another plan which is attracting exorbitant investments by big corporate is the flourishing SEZs in Gujarat. The government has approved total of 51 SEZs till now and many more are in the pipeline. You’ll be surprised to know that Gujarat is the only state in the country which has privatised its ports. In fact, it’s one state that has done phenomenally well in all spheres. Even in agriculture and tourism sectors the state is not far behind. The annual income from agricultural sector has increased from just Rs.34 billion to a whopping Rs.90 billion over the years. Moreover, the government is planning to cover around 18,000 villages with broadband connectivity in the near future which will help farmers and traders to market their products directly through e-business. However, it’s just not investments that seem flowing into the state. Even tourists find it hard to stay away from it. It’s the rich culture and scenic beauty that makes Gujarat a hard-to-resist place on their travel map. In fact, after organising the Kutch festival the flow of foreign tourists has increased considerably, making Gujarat a hot spot for tourists from all over the world.

So as its glorious past, the future too seems golden for the state. Thus there is no doubt that Gujarat is one of the favourite destinations for investors because of forward looking government policies and the well developed infrastructure in place. Surely with this high, the investments are expected to be double in the coming years.

For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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