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India By State - Orissa - Business Opportunities


Business Opportunities

 

Introduction

Orissa has been a forerunner in industrial growth, Agro-based businesses and tourism. The state has huge potential in marine based agro-processing businesses. Its huge mineral deposits, sufficient water and power supply offer excellent opportunity for the investors to establish their operation in the state.

With a vast mineral deposit the state ranks sixth in mineral production in India. Various mineral resources found in the state are bauxite, coal resources, iron ore, nickel and chromite resources. The main agriculture products in the state are coconut, cotton, fruits, groundnut, jute, oil seeds, potato, pulse, rice, spices and vegetables etc.

Some of the factors influencing growth and investment within Orissa are the following;

  • Availability and ease of use of factor inputs such as land and labour;
  • Availability of adequate physical and social infrastructure
  • Governance and regulatory framework in terms of rules and regulations governing entry, operation, and exit of firms, stability in regulation, integrity of public services, law and order and investment facilitation; and
  • Provision of incentives and access to credit

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Key Industries

Agro-based

The prime main agriculture products produced in Orissa are rice, pulse, oil seeds, vegetables, groundnut, cotton, jute, coconut, spices, potato and fruits. There is tremendous scope for agro-based industries, such as cattle poultry, coconut oil, cotton oil, dal-milling, dehydration of vegetables, edible oil milling, maize milling, mushroom cultivation, non-edible oils, potato chips, rice milling, sugar mills many more. Orissa witnesses coconut cultivation over an area of more than 50,000 hectares. The opportunities in the agro-based industries in Orissa have given a boost to industries like fertilizers. The sugar industry in Orissa has been given particular emphasis, and has many projects underway.

Aluminium

Orissa has nearly 50 per cent of the bauxite reserves of India. This makes the state the first choice for setting up aluminium and aluminium based industries in Orissa. The supportive facilities, such as adequate water and power supply are much encouraging

IT/ITeS

The IT sector is dominated by Small and Medium enterprises totaling more than 300 units. The number of software professionals engaged in the state is 12,000.

The State has a capable workforce to cater to the needs of this industry. It produces 20,000 Bachelor of Technology and MCA Graduates, about 3,000 Management Professionals and 50,000 General Graduates every year.

The growth of software export in 2006-07 was 58% against national average of 28%.

The State is targeting software exports of US $1 billion by 2011-12

Iron & Steel

Orissa is one of the biggest producers of iron and steel in India. The state accounts for about 32.9 per cent of all the iron ore deposits in the country. This makes Orissa the favourite designation for many domestic as well as international players to set up their iron and steel plants. The state has vast reserves of other minerals, such as coal, dolomite and limestone, which are required for the industry. There are abundant water resources, surplus power availability, good road and rail network, port facility at Paradip and two more new ports coming up at Gopalpur and Dhamra

Mining

Orissa is one of the country's richest states to mineral resources. The state accounts for 98 percent of chromite, 95 percent of nickel, 50 percent of bauxuite, 32 percent of iron ore and 24 percent of coal. The mineral belt in the state has spread over in an area more than 6000 Sq. Km. Some of the other important minerals found in the state are: manganese, lime stone dolomite, graphite, decorative stones, beach sand, china clay, tin ore etc.

Mineral

Percentage of national reserves

Iron Ore 32.9%
Bauxite 50%
Nickel 95%
Chromite 98%
Coal 24%

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Power

The State of Orissa has ten important river systems. Mahanadi River is the 5th largest river in the country in terms of flood discharge (45000 Cusecs) and flows in the centre of the State from west to east.

The Hydro Potential of the State at 60% load factor is assessed to be 2850 MW.

Orissa also has 45000 MT grade coal deposits in Mahanadi Coal Field and Talcher coal Fields area and can sustain 75,000 MW of power for 100 years.

Tourism

The tourism sector within Orissa is one with vast potential for growth and is critical to the economy in terms of foreign exchange earnings as well as creation of employment opportunities.

Orissa is endowed with touristic features across the State. Bhubaneswar, the Capital city of the State, is known as the Temple city of India having about 500 temples. Puri, Bhubaneswar and Konark are the main centres for Religious Tourism.

The tourist inflow in the State has increased from 2.9 million in 2000 to 5.3 million in 2006 representing a CAGR growth of 10.6%. The corresponding inflow of money through tourist's expenditure has increased from US $213 million to US $600 million representing a CAGR growth of 19%

District Wise Business Opportunities in Orissa

District

Industries

Angul Mining and mineral-based industries, aluminium, coal mines, power generation and fertilisers, SSIs in engineering units, fly ash bricks, grinding
Bolangir Mining and mineral-based industries. SSIs in agriculture-based industries, engineering
Baleswar/Balasore Alloys, paper mills, tourism, fishing
Bargarh Mining, cement, fisheries, animal husbandry, SSIs in engineering, glass and ceramics, paper products, rice mills and agro-based products
Boudh Mining, textiles, SSIs in agro-based products and textiles
Cuttack Paper mills, textile and steel industries, handicraft and cottage industries (silver filigree, brass and metal works, stone carving, cane and bamboo products among others), food-processing
Deogarh Coal industries at Talcher, power generation, steel and food based industries
Dhenkanal Tourism, timber based industries, bamboo works, refectories and asbestos industries
Gajapati Fisheries, horticulture, SSIs in agro-based industries, engineering and metal works
Ganjam Chemicals, sugar, textiles, SSIs in food-based products, glass and ceramics, textiles
Jagatsinghapur Shipping, food processing, manufacturing, repairing and fisheries
Jajpur Mining, food based industries
Jharsuguda Steel and related industries
Kalahandi Mining, sugar mill, cotton mill, oil seed based industry.
Kandhamal Food based industries, graphite industry, forest based products
Kendrapara Food based industries

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Key Players

Arcelor Mittal

Arcelor Mittal has signed a Memorandum of Understanding with the Orissa Government for setting up a 12 mtpa steel plant. The plant is estimated to be set up at an investment of more than USD 9.5 billion, in Keonjhar district. The entire plant will be completed in two phases of 6 mtpa each.

Infosys Technologies Ltd

Infosys Technologies Limited is India's leading software services and IT consulting firm. Infosys has a world-class development centre at Bhubaneswar with a decade of strong presence in the state. The development centre at Bhubaneswar is engaged in fostering Infosys' relationships with its clients from countries, such as Canada, Europe and North America.

Hindalco Industries Ltd

Hindalco, one of the largest producers of primary aluminium in Asia, is the world's largest aluminium rolling company. Owned by the Aditya Birla Group, Hindalco acquired the Indian Aluminium Company Ltd (INDAL). The Indal units at Hirakud, Orissa comprise of two smelters, one located, with a captive power plant and coalmines

National Aluminium Company Limited (NALCO)

Incorporated as a public sector enterprise of the Government of India in 1981, National Aluminium Company Limited (NALCO) is Asia's largest and one of the world's seventh largest integrated aluminium complexes. The main units of NALCO in Orissa are at Damanjodi (Mines & Refinery complex) and Nalconagar-Angul (Smelter & Power Plant Complex) are engaged in bauxite mining, alumina refining, aluminium smelting and casting, power generation, rail and port operations. These units employ the world's latest and finest technologies in the aluminium manufacturing industry.

National Thermal Power Corporation (NTPC)

National Thermal Power Corporation (NTPC), India's largest and the world's sixth largest electricity generation company shares about 19.5 per cent of installed capacity in India. NTPC generates 27.7 per cent of total electricity of India. NTPC has two coal-based power plants in Orissa at Talcher and Angul with an installed capacity of 460 MW and 3,000 MW, respectively.

Paradeep Phosphates Ltd (PPL)

Incorporated in 1981, Paradeep Phosphates Ltd (PPL) was established as a joint venture between the Government of India and the Republic of Nauru. PPL is currently held by fertiliser majors Zuari-Chambal Group and OCP of Morocco. PPL is a major producer of phosphoric fertilisers. It produces diammonium phosphate with a capacity of 2,400 tonnes per day in the first phase. Its second phase produces phosphoric acid and phosphorus pentaoxide.

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Reliance Energy Ltd (REL)

Reliance Energy Limited (REL) has been actively participating in the initiative of the Orissa Government for privatising its distribution systems. REL has invested about USD 260 million in three electricity distribution companies, namely Western Electricity Supply Company of Orissa Limited (WESCO), North Eastern Electricity Supply Company of Orissa Limited (NESCO) and Southern Electricity Supply Company of Orissa Ltd (SOUTHCO). NESCO. WESCO and SOUTHCO cater to a consumer base of 0.40 million each with an annual energy input of 2,500 MW, 3,700 MW and 1,600 MW.

Rourkela Steel Plant (RSP)

Rourkela steel Plant (RSP) is one of the largest steel plants of the Steel Authority of India Limited (SAIL) in India. Established in 1955, RSP is a major producer of flat, tubular and coated steel products and produces 1.6 million tonnes of diversified steel items per annum. The plant has made major improvements in the areas, such as steel quality, packaging, with highest class of service delivery and customer satisfaction. RSP focuses largely on the CRNO, galvanised plain and corrugated sheets and tin plates and packaging of HR coils.

Tata Sponge Iron Ltd (TSIL)

Tata Sponge Iron Ltd (TSIL) was initially established by Tata Steel in collaboration with IPICOL. The primary aim of the unit was to introduce industrialisation to a backward area of Orissa. Located at Bilaipada, near Joda, TSIL incorporates an indigenous technology for making sponge iron.

Vedanta Group

The London-based holding company of Sterlite group, Vedanta Resources Ltd, is a key player in the aluminium industry in India. Vedanta Resources Ltd has established the Vedanta Alumina Ltd, a 0.5 million tonne per annum capacity aluminium smelter at Jharsuguda. The group is setting up an alumina refinery at Lanjigarh, Kalahandi district of Orissa. This project has a capacity of 1.4 million tonnes per annum. Vedanta operates several bauxite mines within the aluminium operations of group companies, BALCO and MALCO.

 

Export Profile

Orissa's total exports were US$ 3.24 billion in 2007-08. Exports increased at a CAGR of 36.7 per cent between 2001-02 and 2007-08. Orissa has been a major exporter of mineral and metallurgical products, accounting for 52.1 per cent and 37.2 per cent of total state exports, respectively.

The State Government has identified some sectors for export promotion and facilitation. These are: agriculture and processed food products, readymade garments, electronics, IT, engineering goods, arts and crafts, and minerals and mineral-based products.

Break up of investments by sector

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More Information on Orissa

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