INDIAN STATE : RAJASTHAN

General Information

Rajasthan is located in Northwestern India and has boundaries with the States of Punjab, Haryana, Uttar Pradesh, Madhya Pradesh, and Gujarat as well as a long international boundary with Pakistan.

Rajasthan excels itself in a variety of fields such as industry, power, agriculture, handicrafts and law and order. Rajasthan successfully fulfills the locational requirements of domestic as well as international companies. Its immediacy to the northern and western markets of India, immeasurable mineral resources, the trouble free labor environment and the investor friendly nature of the state government makes it a key choice for business investments. The State has taken numerous policy initiatives to sustain and strengthen an investment environment in which the private sector can flourish. These initiatives seek to promote private sector involvement in infrastructure development across various sectors. Rajasthan attracts a large number of Multinational Companies to set up projects in the State.

Fact File

Geographical Area	3.42 (lakh sq. km)
Capital	Jaipur
Population (2001 Census) In lakhs	565.07
Gross state Domestic product (GSDP) at current prices in 2004-2005 (as of Feb 2006)	108734 (Rs. Crore) US$ 23.5687 bn
Gross state Domestic product (GSDP) at constant price (1993-94) in 2004-2005 (as of Feb 2006)	65781(Rs.Crore) US$ 14.2584 bn
Net State Domestic Product at Current Prices (2004-05)	95298 (Rs.Crore) US$ 20.6563 bn
Net State Domestic Product at Constant Prices (1993-1994) for(2004-05)	58390 (Rs.Crore) US$ 12.6597 bn
Per Capita Income at current prices (2004-2005)	Rs 15673 US$ 339.756
Percentage of State Population to All India Population	5.49
Total Investments (as on Jan 2006)	53,600 (Rs. Crore) US$ 11.6294 bn
Literacy Rate (2001 Census) Male literacy Female	60.41% 75.70% 43.85%
Principal languages	Hindi, Rajasthani and English

Source: CSO Estimates
Monthly review of Gujarat economy

Climate

• Summer (March to June) -Warm
  
• Monsoon (July to August) -Warm
  
• Winter (November to February) - Cool and Pleasant

Area

342,239 sq. km.

Advantage Rajasthan

Rajasthan is one of the most preferred destinations for investments in major sectors. The state is an obvious choice for agro and mineral based industries owing to easy availability of raw materials. There is vast potential for food processing, solvent extraction and associated industries like cold storage in Rajasthan. The large stock of cattle is an advantage for leather, wool, dairy and meat based units. Other thriving industries in the state are textiles, tourism, automobiles, consumer goods and information technology.

Rajasthan has attracted a large number of Multinational Companies to set up projects in the State. Industrial houses of India and multi-nationals alike have set up ventures in fields as diverse as Information Technology, Electronics, Textiles, Chemicals, Agro-processing, Cement, Granite, and Engineering. Multinational companies like Ericsson, Corning, GE Capital, Ford, Bosch & Lomb, Mico-Bousch, Electrolux, Gillette etc. had chosen the State of Rajasthan for setting up their projects

The leading advantages of the state are:

• Rajasthan is geographically the largest state in the country
  
• Rajasthan has formulated Investor friendly policies
  
• The state has remarkably stable political environment
  
• The state is blessed with adequate power availability
  
• Access to booming markets
  
• Rajasthan has a pool of skilled workforce
  
• The state has excellent Law & Order situation
  
• Peaceful and Congenial work environment
  
• Developed infrastructure, enough land & water
  
• Comparatively less loss of man days due to labor problem
  
• Pro-active officials and "Single Window Clearance"
  
• Proximity to National Capital
  
• International Airport at Jaipur (domestic Airport is being upgraded)
  
• Well known on the world tourist map.
  
• Second Largest deposits of non-ferrous minerals in India
  
• Monopoly in Marbles, Sand Stone
  
• Second Largest deposit of Lime Stone
  
• Huge Deposits of Ceramic raw materials etc.

Economic Infrastructure

Roads

All parts of Rajasthan are well connected by road, with a road length of 1,63,952 kilometer in 2004-05. The state forms a corridor between the northern and southwestern states. It provides passage to and from the ports of Gujarat to the landlocked states in the north of the country. Thirteen national highways pass through the state and these highways connect the state to major cities, ports, and industrial centres such as Delhi, Indore, Ahmedabad, Kandla, etc. The Golden Quadrilateral and the North-south and East-West corridors of National Highway Development project will benefit Rajasthan by the provision of 1200-kilometer length of near expressway standard four/six laned roads in the state.

In Rajasthan, work on renovation and improvement of the statewide road network has been taken up in the earnest. A Road Development Fund Act 2004 has been put in place in the state. The government has created a revenue stream to gather money for the non- lapsable road development fund by levy of a cess on diesel and petrol. This money was leveraged to access finances to the tune of Rs. 1500 crore and through a joint venture RIDCOR, set up in partnership with IL&FS, is augmenting the National Highway Programme by converting 1000 kilometer of state highways to world class express ways under the Mega Highway Project-I, to be completed by December 2007. In the next phase, under the Mega Highways Project-II, another 1000 kilometer of expressways shall be developed at an estimated cost of Rs. 1325 crore. BOT projects have become operational and 29 projects worth Rs. 366 crore have been completed and 5 projects worth Rs. 93 crore are underway.

A Chief Minister's Road Development Program has been launched at a cost of Rs. 2300 crore. The components of the program are as follows:

• The Rs. 1500 crore Mega Highways Project
  
• Construction of 16 ROBs at a cost of Rs. 100 crore
  
• Construction of cement concrete roads in habitation portions of state highways and major district roads at accost of Rs144 crore
  
• Upgradation of 4500 kilometers of WBM Roads to bitumen roads at a cost of Rs.412 crore
  
• Construction of 1000 kilometers of new roads to link places of tourist and religious importance at a cost of Rs. 120 crore
  
• Development of one road in each district as a model road

Power

Power is regarded as an axis of development and the state government has accorded a high priority to this sector. To ensure efficient supply and distribution of power, a special monitoring cell has been set up. In addition to this, monitoring committees at the grid and sub-station level comprising of public representatives, farmers and officials regularly monitor supply positions.

A massive feeder renovation programme is underway and by 2008-09 all 8475 rural feeders shall be covered with the aim to reduce transmission and distribution losses by 15 percent. This should also allow 24 hours uninterrupted single-phase domestic power in rural areas.

Average energy availability in the state has increased by 15 percent to 76 lac units per day. To augment power generation capacity, work is on at the new power plants including Giral, Dholpur, Chabra, Kota Unit VII, Suratgarh unit, and Barsingsar.

A policy for promotion of private sector investment for power generation has been notified. Salient features include exemption from stamp duty on execution deeds, exemption/ remission from various taxes on capital goods, facility of single window clearance etc. Private sector projects would be required to sell at least 50 percent of power within the state.

Rajasthan has been recognized as one of the two leading states that have vigorously pursued power sector reforms. The focus of these reforms is to provide an environment that is conducive for private sector participation. The key components of the power sector reforms are as follows:

• Management of demand to conserve and promote efficient use of energy and ensure environmental protection.
  
• Tariff reforms: the State Cabinet has already approved First-level revision in tariffs.
  
• Establishment of an independent regulatory commission to regulate the functioning of the power sector on sound commercial principles.
  
• Unbundling the State's electricity board into separate, Government-owned generation, transmission and distribution companies.
  
• Promotion of competition among various power sector entities.
  
• Corporatisation and commercialization of the emerging power sector entities to make the power sector attractive for potential investors.

Water Resources

The government has taken a number of measures to address the critical issues of this sector. The government has laid emphasis on the management of water resources by way of institutional strengthening, capacity building, multi- disciplinary approach and involvement of stakeholders in the water management systems for creating a sense of ownership and sustainable development of the water resources. Full funds have been provided to avoid time and cost overruns. All ongoing irrigation projects are proposed to be completed by the year 2007-08(except Narmada and IGNP stage II, which are likely to be completed by 2009-10). Speedy execution of master plan for construction of water harvesting structures with involvement of NGOs is being planned.

The rehabilitation of 91 projects has been taken up under the World Bank financed programme by the name of Rajasthan Water Sector Restructuring Project (RWSRP) at a cost of Rs. 734 crore involving a CCA of 6.25 lacs hectares. The Government of Rajasthan has created a separate Water Resources Planning Department (SWRPD) for integrated planning of surface and ground water resources. The State Partnership Programme (SPP) has been finalized with the European Commission for 80 million Euro (Rs450 Crore). The SPP aims to support statewide sector reforms leading to sustainable and integrated water resources management in Rajasthan.

Urban Development

The government has given urban development sector top priority, keeping in view the burgeoning population, demand for civic amenities and conservancy services. Some of the notable initiatives in this sector include:

• Rajasthan Urban Infrastructure Development Project (RUIDP): this project was undertaken for development of cities of Jaipur, Kota, Jodhpur, Udaipur, Bikaner and Ajmer. The outlay for this project stood at US$ 362 million (Rs. 1529 crore). The project has been implemented successfully and has changed the scenario of these cities through civic infrastructure upgradation.
• Sahari Jan Sahabhagi Yojna: this scheme was launched in December 2004 with a view to encourage public- private partnership
• Heritage Conservation Development Plan was launched in December 2004 under which works like improving civic facilities near the heritage sites, approach road, signage, etc. are being taken up. 23 cities have been identified under this plan and funds to the tune of Rs. 15.40 crore have been allotted for the same.
• Jaipur Action Agenda Group (JAAG) has been constituted for Jaipur in which nine thrust areas for urban development have been identified with a special focus on "People's Partnership in development of Jaipur". Similar groups are being constituted to further the development agenda in other major cities of the state.

Railways

The state has well connected network of railways and well managed railway stations. the cities of Rajasthan are well integrated with the national rail network, and direct trains link Jaipur with major cities across the country. The North Western railway is one of the sixteen railway zones in India and is headquartered at Jaipur.

Gauge conversion from meter to broad gauge is underway at several parts of the state and will aid in better connectivity with neighboring states.

Social Infrastructure

Education

The education scenario of the state is changing rapidly by the initiatives taken by the Govt. as well as by the involvement of other organizations. Various plans and projects have been implemented that focus on improving the delivery of educational services, and in particular on promoting equitable access, enrolment and retention of children in schools, reducing gender disparities, promoting skill development and enhancing learning levels.

Rajasthan is fast emerging as a preferred destination in the field of education. After the government of Rajasthan permitted setting up of private colleges in the state, the technical education sector has witnessed a boom in private investments. More than a hundred colleges- around 38 engineering, 32 MBA, 19 MCA and 35 pharmacies have mushroomed in the past few years. The government is heading towards technical upgradation by formulating plans for establishment 128 industrial training institutes (ITIs). Out of these 108 will be in private sector and 20 will be government aided.

Currently, the state has nine universities. The university of Rajasthan is one of the best universities in the country and has got A+ accredition from the National Assessment and Accredition Council, India.

The private university act enacted by the state government has opened up new avenues for private participation in education sector. Considering the concentration of educational institutions in already developed regions, the government has identified various other potential regions for fresh investments. These include districts like Bhilwara, Barmer, Jhalawar, and Sirohi. The Rajasthan Self Financed Private Universities Ordinance (2004) issued by the government cites that any society, which is, registered under Indian Registration of Societies Act 160 or Rajasthan Societies Registration Act 1958 or any Public Trust registered under the Indian Public Trust Act 122 or Rajasthan Public Trust Act 1959 or a company registered under section 25 of the Companies Act 1956 is eligible to apply for establishing a private university.

Major Education Sectors

Jaipur: being the capital, Jaipur is a key educational centre. The city offers a bouquet of short-term courses and diplomas. Affiliated branches of various institutes organize certificate courses in fashion designing, interior decoration and event management among others.

Kota: with over 30,000 Indian Institute of Technology (IIT) aspirants migrating to Kota every year, this city has already carved a niche for itself in the education sector. Essentially known for its coaching centres, Kota is now home to thousands of students from across the country. Its coaching institutes have made their mark by displaying stupendous results in the past few years.

Jodhpur: the city of Jodhpur is an upcoming destination for law students. Jodhpur is among the best destinations for legal education at the undergraduate, post graduate and doctoral level.

Health

The state of Rajasthan allocates around 40 percent of its budget in social sectors like education, health and family welfare, housing, UDH, and welfare of SC and ST. a sum of Rs. 1100 crore (approximately) was spent on medical and health and family welfare in 2004-05, about 22 percent of which was spent on referral health care services.

The state has formulated a "Policy for Promoting Private Investment in Health Care Facilities (2006)". The objectives of the policy are manifold:

• To promote private sector investment in Medical & Heath Care Institutions,
  Medical & Dental Colleges and support units like Diagnostic Centres, Blood Banks and Paramedical Training Institutes.
• To ensure delivery of quality health care with reasonable costs.
  
• To promote development of Centers of Excellence for Medical Care.
  
• To promote Rajasthan as a Medical Tourism Destination.
  
• To develop Complementary and Alternative Medicine Centres.
  
• To develop Super Specialty Health Care Institutions.
  
• To promote Public Private Participation in Medical and Health Sector
  
• To develop standards for infrastructure and operations.
  
• To create a regulatory body with supportive role.

For more information

Housing

During the period of April- March 2005-06, Rajasthan constructed 38, 431 houses under Indra Niwas Yojna. The state surpassed the target by 19.8 percent. Under the economically weaker section scheme, Rajasthan constructed 1650 houses as against a target of constructing 1500 houses. This has translated into a target achievement of 110 percent.

The Rajasthan Housing Board plans to construct 7,000 houses in different cities of the State. It plans to construct houses in 53 cities in a phased manner. It is reported that Jaipur would have the maximum number of houses. Out of the 1,000 houses on the map in Sanganer (Jaipur), 944 have been allotted to the applicants. The first phase to construct the houses under the Gharonda scheme in 20 cities has started.

The Phase I covers Ajmer, Alwar, Beawar, Bhilwara, Bikaner, Chipa Barod, Churu, Dausa, Gulabpura, Hanumangarh, Jodhpur, Kishangarh, Kotputli, Nagaur, Partapura, Pratapgarh, Rajsamand, Jaipur, Suratgarh and Tonk cities. In Atru, Eklera and Baran 200 houses each would be constructed. In the first phase, construction of 3,459 houses was taken up. Out of the 2,800 completed houses, 2,600 families were given allotment. Phase II involves construction of 780 houses. The cities where the Phase II of the scheme would be implemented are Sunel in Kota, Dholpur, Dungarpur, Sawai Madhopur, Chabra, Abu Road, Balotra, Banswara, Naseerabad, Badi Sadri, Sikar and in Udaipur.

The Phase III of the Gharonda housing scheme, construction has been planned in Khairthal, Pindwara, Sangwara, Suratgarh and Lakheri. The board plans to construct 50 houses each in the chosen cities, the work on which has been started. The Phase IV of the housing scheme includes construction of 50 houses each in Keshoraipatan, Jhalrapatan,Sardarshahar, Phalna, Tijara. As many as 100 houses would be constructed in Jhunjhunu, Neemrana, Hindaun, Anta, Barmer in accordance to the scheme.

The state has formulated a "Rajasthan Urban Housing and Habitat Policy 2006" which has been justified on the following grounds:

• Establishment of an efficient housing & infrastructure stock &
  
• Property market mechanism.
  
• Establishment of sustainable human settlement.
  
• Land use decision
  
• Commitment of resources to various housing programmes /Projects / problems.
  
• Creation of organizations and agencies to deal with various
  
• Housing problems.
  
• Commitment of resources to programmes which encourage
  
• Private investment in housing.
  
• Legal framework specifying rights and responsibilities of various stakeholders.
  
• Designing of tax structure and legislation conducive to housing development process, flow of finance and other resources.

Major Industries

Information Technology and IT enabled Services

Software and services exports continued to remain on top of the IT industry's revenue. The export- driven software sector saw major long-term projects come to Indian ICT leaders and Indian Companies bagging a larger and larger share of the global outsourced business. As per the projections of NASSCOM, Indian IT and ITeS market will be of $62 billion by 2009 and US$ 148 billion by 2012. The growth in IT and ITeS market in India will translate to manpower requirement estimation of 9.72 lacs for IT export services and 27.17 lacs for ITeS export services by 2012.

The state of Rajasthan offers huge investment opportunities in IT sector especially ITeS. Rajasthan State Industrial Development and investment Corporation Limited (RIICO) has developed state of art IT parks at Jaipur, Kota, Udaipur and Jodhpur to attract investment in IT sector. RIICO is also considering developing such IT parks at Bhiwadi (Alwar). The infrastructure in terms of developed plots, continuous power High-Speed Data Com Facility through satellite earth station, road etc. are being made available to the IT industries in IT parks.

Rajasthan has attracted an investment over Rs. 1000 crores in IT and Electronics sector in over 60 projects. RIICO has extended financial assistance of over Rs. 50 crores to the sector. The turnover of this sector is over Rs. 1500 crores with export of over Rs. 125 crores. It is projected that by 2008, the export from the State in IT and Electronics sector would be over Rs. 500 crs. The major industries are Electrolux, Ericsson, GE, Samcor, Instrumentation, Rajasthan Electronics & Instruments (REIL), Genus overseas, Allied Electronic, Compucom, Cistems software, Lipi Data, Aksh Optifibre etc.

An investor friendly IT policy is already in place and provides lucrative incentives to IT industries. The following concessions are being available to the IT parks:

• Land rebate upto 60 percent depending upon type and size of investment
  
• Exemption of stamp duty on registration of land
  
• 50 percent exemption from electricity duty for 7 years
  
• Simplified labour laws
  
• Customized package for investment beyond Rs 10 crore
  
• Venture Capital (on merit)

Bio Technology

A new generation of biotechnology developed as a result of intensive work in India has opened up new opportunities for economic development in the country.

The country is also rapidly emerging as a major market for biotech products. The current consumption of biotechnology products in India is of the order of Rs. 90 billion, which is expected to increase to Rs. 234 billion by 2010. The healthcare sector would contribute 38% of the market, agriculture 32% and industrial products 30%. The small-scale sector is expected to play a major role in the growth of the biotech industry.

Rajasthan is very rich in Bio resources. The State provides tremendous bio diversity, rarely to be found in any other State. Rajasthan is very rich in cattle breed also. State has highest livestock population and there is good potential in animal husbandry and genetic engineering. Thus Rajasthan has great potential to create immense industrial activity in Biotechnology and modern Biotech products involving recombinant DNA based products and Bio Informatics.

To attract investment in BT sector, RIICO is considering developing State of Art Bio Tech Parks at Jaipur, Jodhpur and Bhiwadi (Alwar). The infrastructure in terms of developed plots, continuous power, High Speed Data Com Facility, Roads, common testing facility etc. are being developed in Bio Tech Parks.

Investment Opportunities in Biotechnology in Rajasthan

• Research and development in the cattle species improvement programme and Biotechnology incubation centers
  
• Bio-pesticides and bio-fertilizers
  
• Genetic improvement of seeds
  
• Genetic improvement of animal breeds
  
• Dry farming
  
• Treatment of industrial effluents
  
• Recycling/recovery of bio-products
  
• Waste management
  
• Bio fuels/energy
  
• Industrial enzymes
  
• Fermentation products for better yeast

The State's new Biotech Policy proposes major incentives to Biotech (BT) Units:

• 100% exemption from Stamp Duty for registration of land in designated RIICO BT Parks. In other areas, it would be 50% only.
  
• Bio- informatics and biotechnology R&D units being non- polluting by nature may be allowed to be set up in the residential areas and in the BT parks as well.
  
• Biotechnology industries will be treated as industrial (and not commercial) consumers and electricity tariff applicable to the industrial consumers will be levied on such industries.
  
• BT industries will be exempted from seeking permission for installation of DG sets from Discoms.
  
• Captive power generation plants installed by the Biotechnology Industry will be eligible for total exemption from electricity duty.
  
• The Biotechnology Industry will get 50% exemption of electricity duty for seven years.
  
• Purchase Tax on capital goods in BT parks of RIICO would be set off against the RST/CST paid in the State. This benefit will be allowed for all BT units in the State irrespective of their location.
  
• Entry tax on all inputs as well as capital goods including captive generation set will be exempted during the implementation stage of the project for a period of five years or till the date of completion of the project which ever is earlier.
  
• 5% Interest Subsidy and 25% Wage/employment subsidy would be subject to maximum limit of 75% of the tax payable and deposited under RST, CST and VAT. The subsidy shall be for seven years.
  
• Government of Rajasthan will give 50% exemption from conversion charges.
  
• Labour laws relaxed.
  
• The State Government will offer customized package of incentives for large Biotechnology Projects e.g. projects where investment is more than Rs.100 million or a Fortune 500 company is implementing the project. The customized package would be decided by the Board of Infrastructure Development & Investment Promotion (BIDI)/State Level Empowered Committee (SLEC) on case-to-case basis.
  
• For strengthening of biotechnology infrastructure in the State, Government of Rajasthan will set up a Development Fund, with an initial corpus of Rs.500 million.
  
• Biotechnology industries shall be exempted from routine inspection by inspectors like factories & boilers, excise, labour, pollution, environment, industries etc.

Agro Based Industries

Rajasthan, being leading producer of bajra, barley, pulses, coriander, Cummins and a number of ayurvedic herbals, offers huge potential for agro-based industries. The government of Rajasthan has given utmost priority to and attention for development of agro-food parks. The following concessions are being provided to the units located in agro food parks developed by RIICO:

• Exemption of land and building tax
  
• Exemption of stamp duty
  
• Exemption of electricity duty for 5 years
  
• Public Utility Status
  
• Exemption from entry tax on raw materials
  
• Set off of sales tax on capital goods
  
• Set off of entry tax on capital goods
  
• Exemption of Mandi Tax

Mineral based Industries

Rajasthan is the county's second largest mineral producing state after Bihar. 42 major and 23 minor minerals are produced in the state. Abundant availability of minerals such as limestone, zinc concentrate, gypsum, fluorite, asbestos, calcite, wollastonite, jasper, garnets, marble, lead & tungsten concentrates, phosphate rock, clay, soapstone, sandstone, limestone and feldspar. Substantial quantities of lignite and natural gas have also been identified in the desert areas of the state. Rajasthan is already exporting wollastonite, soapstone and a variety of dimensional stones. Export oriented units are given a priority while granting mining leases.

Rajasthan is among the largest producers of cement in the country. The demand for cement is expected to grow at the rate of 8 to 9 percent annually to reach 160 million tonnes by 2006-2007. This would result in a demand for 3 million tonnes in Rajasthan alone. Large reserves of clay and silica sand, raw materials for the ceramic and refractory industry, are available in the state. Further, the state has locational advantage as large north Indian markets for ceramics is easily accessible from the state. With about 185 million tonnes of rock phosphate reserves in the state, manufacture of phosphoric acid/DAP is a viable venture.

The discovery of natural gas in the state has opened up possibilities for additional investment in the chemical and ceramic sector.

There is also a good potential for locating new base metal deposits. Accordingly, beneficiation and smelting plants may be set up based on newly located deposits at an investment of Rs 400 crore. One zinc smelter is expected to come up between 2010 and 2020, and one lead smelter after 2010.

Rajasthan has enormous resources of Dimensional Stones that are widely spread all over the state. The estimated reserves are as follows:

Marble -1100 million tons
Sandtone-900 million tons
Flaggy limestone- 1800 million tons
Slate- 50 million tons

Investment And Industrial Policies

Investment Policy (2003)

With a view to provide investors an attractive opportunity to invest in Rajasthan, "The Rajasthan Investment Promotion Scheme" came into being on 1st July 2003 and will remain in effect till 31st March 2008.

full text of the policy

Information Technology Policy (2000)

Rajasthan is one of the front-runner states in the use of IT in government. It is the intention of the state government to consolidate its efforts and to focus its energies to leverage the benefits of IT for the benefit of its people. To attain this objective, a comprehensive "IT policy of Rajasthan" has been prepared by the state.

Full text of the policy

Special Economic Zone Policy

The prime objective of the Government is to develop specially delineated economic zones conforming to the guidelines of the Government of India to provide enabling infrastructure and a hassle free environment to promote exports from the State. Special emphasis will be laid on development of product specific Special Economic Zones to harness inherent potential of the State in the fields of Gems & Jewellery, Handicrafts, Woolen Carpets etc. which would result in increase in exports of these commodities with high value addition.

Full text of the policy

Biotechnology Policy

Rajasthan is very rich in Bio resources. The State provides tremendous bio diversity, rarely to be found in any other State. Agricultural and Forest produce have been the main source of the state economy for quite some time now. It is, therefore, necessary to lay more stress on this sector. Biotech application such as transgenic crops can significantly benefit this sector. The State is a leading producer of mustard, rapeseed, soyabean, barley, maize, wheat, cotton, groundnut, milk, etc. Fruits and vegetables, such as Potato, Tomato and Onion are also available in abundance. There is vast scope of quality improvement of cotton. In addition, there are various varieties of exotic Indian spices in the State. Thus, integrated horticulture development would improve the availability of raw material for food processing industries in the State.

Rajasthan is very rich in cattle breed also. Improved species of camel, sheep, rathi cows, nagouri bullocks etc hold great promise of research and development in biogenetics. State has highest livestock population and there is good potential in animal husbandry and genetic engineering. Thus Rajasthan has great potential to create immense industrial activity in Biotechnology and modern Biotech products involving recombinant DNA based products and Bio Informatics. In line with the developed world, the Government would make all efforts to focus on modern processes in the area of agriculture industry, floriculture, human and animal health care (medical and veterinary science) and environment to provide good commercial opportunities in the field of Biotechnology.

full text of the policy

Leading Business Locations

Bio-Tech Parks

• Bio Tech Park at Sitapura, Jaipur

  RIICO has developed Biotech Park in an area of about 30 acres at Sitapura, Jaipur. The park is located on Jaipur- Kota National Highway, just 4 kilometer from the airport and about 15 kilometer from the city. Good quality infrastructure such as earth station, power, telecom, roads, educational institutions, water supply, etc. are available in the park.

• Bio- Tech Park at Boranada, Jodhpur

  RIICO has developed another biotech park in an area of about 30 acres at Boranada near Jodhpur. The park is located about 15 kilometers from the city. Good quality infrastructure is available in the park.

• Bio Tech Park at Chopanki

  RIICO has developed Biotech Park in an area of about 45 acres at Bhiwadi.

• The state government will also encourage development of Bio Technology Parks in private sector. State Government would consider extending concessions to such biotechnology parks on a case-to-case basis.

Prominent Industrial Areas of Rajasthan State Industrial Development and Investment Corporation Limited

Special Economic Zones (SEZ)	Sitapura, Jaipur and boranada, Jodhpur
Export Promotion Industrial Park (EPIP)	Sitapura, Jaipur and boranada, Jodhpur
Apparel Park	Jaipur
Others	Bhiwadi, Khushkhera, Neemrana, Matsya and Abu Road

For sectoral development of the industries in the state, following cluster industries and the locations have been identified

 

Investment Incentives

Investment Incentives as under the "Rajasthan Investment Promotion Scheme" (2003)

• 100 percent exemption of luxury tax for seven years.
  
• 50 percent exemption of entertainment tax for seven years.
  
• 50 percent exemption of electricity duty for a period of seven years.
  
• 50 percent exemption from mandi tax for seven years.
  
• 50 percent exemption from stamp duty.
  
• 50 percent exemption from conversion charge.
  
• 5 percent interest subsidy.
  
• Wage/ employment subsidy set off against sales tax.

Major incentives for information technology units (Under IT Policy 2000)

• Commercial buildings which are fully dedicated to Software / IT industry will be exempted from Land & Building Tax on a case to case basis by the Empowered Committee on investment chaired by the Chief Secretary. If the use of building changes, this exemption would automatically get revoked.
• Software units have already been permitted to be set up in urban areas. To further liberalize this aspect, Software units will be permitted to be set up in residential plots without change in land use.
• Property transactions in designated IT Parks will be exempted from Stamp Duty.
• Rajasthan State Electricity Board (RSEB) shall endeavor to ensure uninterrupted supply of power. There will be no requirement of taking permission from RSEB regarding installation of DG sets of any capacity for captive use up to 50% of the industry's demand.
• IT Software and IT Services companies, being the constituents of the knowledge industry, shall be exempted from routine inspection by inspectors like those for Factory, Boiler, Excise, Labor, Pollution, Environment, Industry, RESB etc. in line with the approved policy of Government of India.
• IT Software and IT Services shall be deemed as manufacturing activity for the purpose of incentives for the industry in line with the approved policy of Government of India. Depreciation norms and Loan for capital investments and working capital requirements will be in line with the approved policy of Government of India.
• State Fls and the banks will be allowed to invest in the form of equity in line with the approved policy of Government of India.
• All promotional and liberalized policy instruments available to the IT Software and IT Services shall be made available to the IT enabled Services including the Information Content Industry by classifying IT enabled Services as tantamount to IT Software and IT Services in line with the approved policy of Government of India.
• The State Government would encourage flow of investments including FDI and would provide full support wherever required. The State Government will offer customized package of incentives for prestigious investment proposals, e.g., projects where total investments are more than Rs. 10 Crores or a Fortune 500 company is implementing the project. All such proposals shall be received by BIP and would be put up to Board of Infrastructure Development & Investment Promotion for approval on case-to-case basis on merit. Before putting up the case to BIDIP recommendations of Directorate of Information Technology (DoIT) will be obtained.
• The State FIs will provide term loans and equity on priority to units at a reduced rate of promoter's contribution that will not exceed 30% of the total project cost considering merit of the case.
• The State FIs will consider security margin of 30% of the total assets on case-to-case basis.
• 12. Software industries will be treated as industrial (and not commercial) consumers and electricity tariff applicable to the industrial consumers will be levied on such industries.

Special land package to It industries in IT parks/ designated IT Zones

• Very Prestigious Investment - in IT Software, ITES and IT Hardware - For the industry which is set up on the allotted plot by any company with a minimum fixed investment of Rs. 10 crores or by a fortune 500 company, within a period of 3 years, entitled land rebate shall be @ 60% of the plot allotment rate.
• Prestigious Investment - in IT Software, ITES and IT Hardware - For the industry which is set up on the allotted plot with a minimum fixed investment of Rs. 1 crore within a period of 3 years, entitled land rebate shall be @ 50% of the allotment rate for the plot upto maximum of 5 acres area.
• General Investment - in IT Software, ITES and IT Hardware - For the industry which is set up on the allotted plot with a minimum fixed investment of about Rs. 10 lacs per 500 sqm. land and Rs. 2 lac for every subsequent 100 sqm. within a period of 3 years, entitled land rebate shall be @ 25% of the allotment rate for the plot upto maximum of 2000 sqm. area.
• Advanced IT Institutes- For the institute which is set up on the allotted plot with a minimum fixed investment of Rs. 5 crores within a period of 3 years, entitled land rebate shall be @ 25% of the allotment rate for the plot upto maximum of 5 acres area.
• Advanced IT Institutes would mean institutes offering exclusive IT courses at least of the level of MCA /BE / M.Tech (IT) /MBA (IT) /MSC (IT) or of a recognized equivalent.
• General Computer Training Institutes- No rebate in the allotment rate shall be allowed. However, RIICO may consider land allotment upto maximum of 2000 sqm. On prevailing rate provided unit makes fixed investment of about Rs. 5 lacs per 500 sqm. land within 3 years period.

Notes-

a) Production activities will need to be started within three years from the date of possession or from the date of lease deed execution, whichever is earlier.

b) The minimum fixed investment should be made within 3 years from the date of possession or from the date of lease deed execution, whichever is earlier.

c) An undertaking / certificate shall also be submitted by IT unit every year for the use of land for the purpose the land is allotted.

d) Fixed investment shall mean investment in land, building, computers, printers, scanners, plotters, licensed software's, EPABX, networking equipment, UPS, DG-Sets, CVT"s, AC, LAN Cable and other equipment and furniture.

e) In case of failure to observe the terms and conditions regarding investment and time schedule mentioned in the package, the concessional amount shall be recovered from allottee with interest from the date on which concession amount has been reimbursed.

f) In each case the decision of RIICO shall be final as to what qualifies as IT Industry/ Institute for the purpose of above said incentive.

g) For reimbursement of the concessional amount, the plot allottee would be required to inform RIICO office by a registered AD letter sent prior to the scheduled date regarding the building construction. After verification by the Unit Head, the Cheque or rejection letter, as the case may be, will be sent by RIICO within 30 days by registered AD letter

Incentives Available for Establishment of Tourism Industry

State government has declared tourism as an industry and has designed a lucrative investment package to promote the tourism industry.

I) The following incentives will be available to the new tourism units such as hotels and lodging houses

The prescribed authority, under the new Rajasthan investment promotion policy 2003, shall grant the following exemptions. The following exemptions will be available between the period of July 2003 to 31st March 2008.

• Exemption in Luxury Tax: 100 percent exemption of luxury tax for a period of seven years
  
• Exemption in Stamp Duty: 50 percent exemption in stamp duty for a period of seven years
  
• Other Incentives
  • 50% exemption of entertainment tax for seven years.
    
  • 50% exemption of electrical duty for seven years.
    
  • 50% exemption from conversion charge; and/or
    
  • 50% exemption from mandi tax for seven years
    
• Interest Subsidy to Tourism Units such as Hotel, Motel etc.: 5% Interest subsidy and wage/ employment subsidy would be made available to eligible investor during the operative period of the scheme. An additional interest subsidy of 1% shall be made available to SC/ST entrepreneurs.

II) Allotment/ conversion of land to tourism industry

• Under the Rajasthan Land Revenue (Conversion of agriculture land for non agriculture purpose) rule (1992), no land use conversion charges will be paid for establishment of tourism units up to the land of 2000 sq. mts. subject to the condition that 100% unskilled workforce will be employed from the local area.
  
• Under Rajasthan Land Revenue (Industrial area allotment) rule 1959 allotment of Govt. Agriculture Land up to 4 bigha in Rural Area on payment of 25% of the reserve price of the prevailing market price in the concerned area subject to the condition that 100% unskilled workforce will be employed from the local area.
  
• For Heritage Hotels in Rural Areas no land Conversion Charge are taken. In urban areas conversion charge are levied under the provisions of Rajasthan urban improvement trust rules 1974 on built up areas only.
  
• For Tourism units conversion / allotment of land is being done under Rajasthan Land Revenue (Industrial area allotment) rule 1959 and Rajasthan Land Revenue (Conversion of agriculture land for non agriculture purpose) rule 1992 on Industrial rates. (Other than point no. a & b above)
  
• Under Rajasthan Development Trust (Urban Land) rule 1974 - rule 15 & 15B tourism projects to be established in Rajasthan, the Land will be allotted on rates and basis of following investment: -

	Cost of Investment	Rate of allotment
a	Up to an investment of Rs. 5.00 Crore. 200% of the concerned area residential reserve price.	200% of the concerned area residential reserve price.
b	An investment of more than Rs. 5.00 crore and up to Rs. 25.00 crore. 125% of the concerned area residential reserve price.	125% of the concerned area residential reserve price.
c	An investment of more than Rs. 25.00 crore and up to Rs. 50.00 crore. 75% of the concerned area residential reserve price.	75% of the concerned area residential reserve price.
d	More than an investment of Rs. 50.00 crore 60% of the concerned area residential reserve price.	60% of the concerned area residential reserve price.

III) New Multiplex Cinema Halls, Drive in Theatres/ Cinemas

Films which have been 75% picturised in Rajasthan and having U- certificate are 100% exempted from Entertainment Tax (including additional Entertainment Tax) for one year from the date of its first exhibition.

For new Multiplex Cinema Halls, Drive in Theatres/ Cinemas in Rajasthan are exempted from Entertainment Tax for 3 years from the date of Commencement of their commercial exhibition as follow.

1. 75% for First Year,
2. 50% in Second year, and
3. 25% in Third Year.

Investment Opportunities

• Stone Sector
  
  • Job-work processing of imported marble & re-exports
    
  • Stone-craft items - Buy Back agreements and Technology transfer
    
  • Production facilities for consumable: Collaborations, joint ventures,
    
  • Joint venture for mechanized quarrying
    
  • Production of machinery: Collaborations, joint ventures, technology transfers
    
  • International marketing tie-ups for purchase of stones from Rajasthan
• Information Technology and IT enabled Services
• Bio Technology (BT)
  • Research and development in the cattle species improvement programme and Biotechnology incubation centers
    
  • Bio-pesticides and bio-fertilizers
    
  • Genetic improvement of seeds
    
  • Genetic improvement of animal breeds
    
  • Dry farming
    
  • Treatment of industrial effluents
    
  • Recycling/recovery of bio-products
    
  • Waste management
    
  • Bio fuels/energy
    
  • Industrial enzymes
    
  • Fermentation products for better yeast
• Agro Based Industries

  The agro and food processing sector offers scope for development of several industries such as solvent extraction, oleo- resins, kinnow/ orange juice, malt extracts, floriculture and a host of other items. Besides these, items like mushrooms, tomato processing, other processing industries based on mango, ber, pomegranate and other vegetable like onion, potato, garlic. Industries based on herbal and medicinal plants, sheep, goat, buffalo meat processing, poultry and poultry products and non-edible oil processing industries have bright export prospects. The state government on its part, is alive to the needs of this sector with regard to training, technology upgradation, improvement in infrastructural facility and a progressing Government policy with these measures, along with support from central government and the coordinated efforts of various institutions working in the filed of agro and food products. It is expected that this industries with come to occupy its due place in the agro industrial development of Rajasthan.

• Power Sector
  
• Education Institutes
• Urban Infrastructure
  
• Tourism Sector
  
• Handicrafts
  
• Gems & Jewellery
  
• Automobiles
  
• Garments and Textiles
  
• Road & Bridges

Useful Weblinks

Government of Rajasthan

Rajasthan State Industrial Development & Investment Corporation