OPEN FOR BUSINESS
At a time when national economic statistics paint a grim picture of upended small businesses and massive unemployment, Orissa has shone a beacon of hope, lining up firm proposals for investment of over Rs 3 lakh crore. These investments by a hundred-odd companies will create an estimated 110,000 new jobs. State industry secretary Hemant Sharma claims these figures were released only after the Naveen Patnaik government was convinced that the projects would materialise and not remain unfulfilled expressions of intent. “Investments worth Rs 3 lakh crore have been approved by the government’s single window clearance system and are at various stages of execution like land allotment, construction etc.,” says Sharma, brushing aside any scepticism.
In 2020-21, when the pandemic was raging and businesses were either shutting shop or going slow across the country, industries in Odisha contributed to 36 per cent of the state GVA (gross value added), continuing the growth pattern from 2019-20 when the sector grew by 3.6 per cent compared to 0.9 per cent for the country, according to Odisha government figures.
The state is blessed with rich mineral reserves, including 28 per cent of the national reserves of iron ore, coal (24 per cent), bauxite (59 per cent) and chromite (98 per cent). It has seen big-ticket investments by a number of corporate giants such as Tata Steel, Jindal Steel, Bhushan Steel, Hindalco
Industries and Arcelor Mittal Nippon Steel. It is also strategically placed— a 480 km coastline, three operational ports at Paradip, Dhamra and Gopalpur, which together handled 153.9 million metric tonnes of cargo in 202021, a network of good motorable roads and good railway connectivity. Both Paradip and Dhamra ports are being expanded to handle 300 MMT of cargo, three times their current capacity.
Two all-weather riverine ports are also coming up. While the Paradip Port Trust is setting up one on a PPP model with a Rs 4,000 crore investment, a Tata Steel-led consortium is setting up the Subarnarekha Port to serve the hinterland in eastern India—West Bengal, Jharkhand, Bihar and the Northeast.
Odisha’s relative political stability—Patnaik’s Biju Janata Dal (BJD) has ruled the state since 2000—has provided a secure investment climate, possibly why the POSCO wound healed so quickly. The industrial misadventure with the South Korean steel major has left no scars in the minds of investors. So Arcelor Mittal, which had withdrawn from a project in 2013, is now setting up a 24 MTPA steel plant along with a captive jetty. The parcel of land where POSCO had planned its project will now see a 12 MTPA Jindal Steel factory.
“Odisha created a framework for business competitiveness over the last decade, largely due to the vision of chief minister Naveen babu,” says Nilanjan Ghosh, director, Observer Research Foundation. “Natural capital was abundant here, but other factors of business competitiveness have also improved, such as social capital and physical capital (infrastructure). The bureaucracy is by and large supportive of industry and a lower cost of living means the state has a competitive edge in terms of attracting and retaining human capital. All these combine to lower the cost of
Odisha is pushing hard to develop nontraditional labourintensive industries and making investments in retraining its youth for newer jobs
transacting business in Odisha. This is why even underdeveloped regions such as Kandhamal, where JSW Energy is setting up a Rs 6,000 crore pump storage project, are emerging as new centres of economic growth. As a result, insurgency too has come down substantially,” says Ghosh.
TRADE SECRETS
Odisha has 100,000 acres of ready land available for industrial use. A dedicated land bank scheme with an inventory of investment-ready land has been uploaded to the industry department’s ‘Go Plus’ portal—a GI (geographical indication)-based ready reckoner on infrastructure and location-specific industrial plots. The strict enforcement of the Land Rehabilitation and Resettlement Act as a concomitant of land acquisition and making public hearings mandatory has minimised public resentment and agitations.
Among the big-ticket commitments of financial year 2020-21 are Jindal Steel and Power (Rs 76,000 crore), Bhushan Steel (Rs 55,000 crore) and Tata Steel (Rs 47,000 crore). Some 60-70 companies have crossed the preliminary hurdle of getting approval from the ‘Go-Swift’ single window facilitation and tracking portal. Senior officers from all regulatory authorities are part of the portal that handholds investors and helps resolve any issues they might face. The facilitation resource has been around for the past five years, leading to speedier clearances and a far smoother investor experience, says Sharma. No more runarounds of multiple government departments for sundry NOCs (no-objection certificates), for example.“Fifty-plus services under 18 departments are clubbed under a single portal and everything is available at the touch of a finger,” says Sharma. “The deadline fixed for clearances is 25 days. The portal is also linked to the Odisha Rights to Public Service Act.”
Interestingly, during the pandemic period, Odisha has seen a boom in diversified sectors including non-renewable energy, green energy equipment, auto and auto component parts, electronics manufacturing, telecom equipment, textiles, apparel, pharma and bulk drugs. The Odisha Industrial Development Plan, 2025 also contains a blueprint for sector-specific infrastructure development—by way of dedicated parks, readymade sheds, plug-and-play infrastructure and programmes to upscale the skills of local youth for re-employability.
Abig reason why the Naveen Patnaik government wants to shift focus from conventional mineral- and metal-based industries is that they are capital-intensive while now becoming less labour-intensive. For instance, says industry secretary Sharma, steel majors now manage with far fewer employees even though their production has doubled or trebled. Tata Steel at Kalinganagar employed 15,000 people for a 6MT plant while JSW Steel now needs only 7,500 for a 12MT plant. “Compare that with the textiles and fashion industry: Aditya Birla Fashion Retail employs 5,000 for a moderate-sized investment of Rs 500 crore. Sectors like textile and food processing and pharma are labour-intensive,” which serves the state’s other objective of providing gainful employment to its people.
Recognising that Covid has not been kind to the 853,000 migrants from the state, the government has started a skill development institute in Bhubaneswar. Additionally, the Institute of Chemical Technology, in collaboration with Indian Oil Corporation, is creating a pool of skilled workers who have been guaranteed placement within the state. The two institutes are primarily focused on training the state’s underprivileged youth for jobs in industry. The Odisha Skill Development Authority serves as the nodal agency, and armed with a budget of Rs 5,000 crore for the next five years, has set itself a target of upgrading the skills of at least 1.5 million local youth.
As envisaged by the state, the bulk of employment opportunities should come in its own backyard. CM Naveen babu is aiming at self-reliance of a different kind—Atmanirbhar Odisha.