Industrial Developement of Odisha

Industrial Developement of Odisha:-

Orissa is endowed with vast resources of a variety of minerals and occupies a prominent place in the country as a mineral rich State. Abundant reserves of high-grade Iron ore, Bauxite, Chromite, Manganese ore along with other minerals such as Coal, Limestone, Dolomite, Tin, Nickel, Vanadium, Lead, Graphite, Gold, Gemstone, Diamond, Dimension & Decorative Stone etc. are extensively available in the State. This has opened up immense possibilities for locating mineral based industries for manufacture of Steel, Ferro-alloys, Cement, Alumina/ Aluminum, Refractories, Thermal Power etc., along with setting up other auxiliary and ancillary downstream industries.Industrial Developement of Odisha

Saliet Highlights of Industrial Developement of Odisha:-

  • Odisha is one of the most mineral-rich states in India. Key minerals found in the state are iron, coal, bauxite, manganese, nickel, chromite, limestone, dolomite, graphite, decorative stones, beach sand, China clay, tin ore, etc. For the record, Odisha has about 28 percent of India’s iron ore, 24 percent of coal, 59 percent of bauxite and 98 percent of chromite.
  • Odisha accounts for over 55 per cent of India’s bauxite reserves, making it an ideal location for setting up aluminium and aluminium-based companies. The state ranks first in the country in terms of both production capacity and actual output of aluminium.
  • Odisha is one of the favoured investment destinations for domestic and international iron and steel players as well as one of the largest producers of iron and steel in India. The total production of iron ore in Odisha was recorded to be 80.87 million tonnes during 2015-16.
  • Between 2004-05 and 2015-16, Gross State Domestic Product (GSDP) expanded at a compound annual growth rate (CAGR) of 10.25 per cent to US$ 50.8 billion whereas the Net State Domestic Product (NSDP) expanded at a CAGR of 10.37 per cent to US$ 44.92 billion.
  • In the energy sector, independent power producers (IPPs) have invested Rs.32,991 crore on proposed coal-fired projects after entering into MoUs with the state government. Among the 28 power companies, only three – Sesa Sterlite, Jindal India Thermal Power and GMR Kamalanga Energy Ltd – have commenced commercial production in the last 15 years. The IPPs have a combined capacity of 37,000 MW.
  • In the steel sector, out of Rs 222,862.63 crore investment proposed in 50 projects, Rs. 109,638.90 crore has been invested till today, said Mishra. Then, Rs.66,444 crore has been proposed in the aluminium sector by three companies – Vedanta, Aditya Aluminium and RSB Metaltech.
  • Odisha is amongst the top ten states accounting for the highest number of MSME enterprises. Odisha government also launched its start up policy 2016 that aims to create 1,000 startups in the state by 2020. The policy will aim at providing incentives, support and assistance to start ups at all stages of development including idea or prototype stage, commercialisation stage as well as the marketing stage.
  • The state has sector-specific policies for IT and micro, small and medium enterprises. The state government has constituted “Team Odisha” to help with investment promotion.
  • The state government has constituted “Team Odisha” to help with investment promotion.
  • The Orissa Industry is going places with excellent industrial infrastructure and presence of top national and international companies. The state has witnessed an industrial upsurge due to the favorable industrial atmosphere in the state. The state government of Orissa has invited major industrial houses of the country and abroad to invest in the state. It has achieved a considerable amount of success and several prime companies have set up their plants in the state.

 

The industrial structure of Orissa mainly consists of four categories:

  • Medium industries
  • Cottage industries
  • Large scale heavy industries
  • Large scale industries

The large scale medium and large scale heavy industries include the:

  • Cement industry
  • Ceramic Glass plants
  • Refractory units
  • Ferro Manganese plants
  • Aluminum industry
  • Fertilizer plants
  • Agro based industries
  • Chemical industries
  • Tyre factories
  • Aeronautical industry

Mineral Based Industries:-

Occupying an important position on the country’s map, Orissa’s rich mineral reserves constitute 28% Iron ore, 24% coal, 59% Bauxite and 98% Chromite of India’s total deposits. The state’s comparative advantage on this account has attracted the attention of many mining and metallurgical companies. In Orissa, industrialization started shortly after independence. The oldest mines in the state were coalmines at Talcher and Ib valley. After nationalization of coal in 1975 and the national policy on energy sector, many power plants have come up in the state. Major industries in Orissa at the moment include an integrated steel plants at Rourkela, Kalinga Nagar, Jharsuguda and Angul ; NALCO (National Aluminium Company Ltd.) with its Alumina Plant at Damanjodi & Aluminium smelting complex at Angul; Thermal power plants Talcher & Ib valley area etc. in addition to Fertilizer plants, Pulp and paper industries, Ferro alloys plants, cement plants etc. elsewhere in the state. The industrial growth in the state has mostly taken place in the areas where raw materials, water and power are available. The state can be divided into twelve industrially active zones / areas based on minerals namely:

  • Rajgangpur Area (Iron & Steel, Sponge Iron, Cement, Secondary steel. Melting and rolling mill & refractories and chemicals).
  • Ib valley area (Thermal power, Sponge iron, refractories, and coal mines)
  • Hirakud area (Aluminum & rolling mills)
  • Talcher-Angul area (Thermal power, Aluminum, Coal washeries, Ferro alloys, Coal mines).
  • Choudwar area (Ferro alloys, Thermal power, pulp and paper, coke oven)
  • Balasore area (pulp and paper, ferro alloys, rubber industries)
  • Chandikhol (stone crusher, coke oven)
  • Duburi (Integrated steel, ferro alloys, rubber industries)
  • Paradeep area (fertilizer, sea food processing, petroleum coke)
  • Khurda Tapang area (stone crusher)
  • Joda Barbil area (iron, sponge iron, ferro alloys, iron ore crusher, mineral processing).
  • Rayagada area (pulp and paper, ferro alloys).

Keonjhar is one of the premier mineral producing districts in Orissa. The district occupies a prominent place in the mineral map of the Country. Iron ore formations occupy most part of the district which can be traced from the Bihar boarder in the north to the Jajpur boarder in the South. Extensive deposits of Manganese ore are found in Thakurani and Joda East hills of Barbil. The two important mineral based industries in the district are the “Kalinga Iron Works” Barbil and the “Ferro-Manganese Plant”,Joda. Good deposits of Chromite, an important and strategic mineral are found in Boula area near village Nuasahi of Anandapur sub-division. There are also some other mineral deposits in the district such as Quartzite, Bauxite , Gold , Pyrophillite and Lime stone.

THE KALINGA IRON WORKS, BARBIL:-

The Kalinga Iron Works was initially named as the Kalinga Industries in the private sector with technical collaboration of M/S. Fried Crupp of West Germany having one low shaft furnace with a capacity to produce 30000 M.T. of pig iron per annum. It was taken over by the Industrial Development Corporation of the Government of Orissa on 01st April 1963. It has since been named as “Kalinga Iron Works”. Presently the Kalinga Iron Works produces 100000 M.T. of foundry grade pig iron by three low shaft furnaces. Besides, it has a power generating plant of its own which supplies power to the GRIDCO, Orissa to the extent of 2.3 M.W. This industry was running with a capital investment of Rs.1,011.27 lakh in 1985. At present 1,320 persons (both skilled and unskilled) are working in the unit. Under the diversification programme Kalinga Iron Works is also giving to undertake the production of Ductite Iron Spun pipes in close collaboration with TOR-STEEL and MECON. Ductite Iron Spun pipes have a tremendous marketing potential in foreign countries.

FERRO MANGANESE PLANT, JODA:-

The Ferro-Manganese plant at Joda was taken over by the Tata Iron And Steel Co-Ltd. in December 1957. It was established with a capital investment of Rs.3000 lakhs in 1985. At present 391 employees are working in the unit. The plant is primarily meant for supplying Ferro-Manganese for TISCO’s own plant at Jamshedpur.

Besides the reserves of major minerals like chromite, nickel, bauxite, iron-ore and coal; other minerals like china clay, fire clay, limestone, quartz, precious and semi precious stones, copper, manganese, graphite, vanadium etc. are also available in the state. Iron ore is abundantly available in the districts of Mayurbhanj, Sundargarh, Keonjhar and Jajpur. While chromite is confined to Jajpur, Dhenkanal and Keonjhar districts, manganese deposits are available in Sundargarh, Keonjhar, Rayagada and Balangir districts and Dolomite is available plentily only in the district of Sundargarh. There are two major coal bearing area in the state which are currently being exploited namely Talcher and the Ib valley.

Iron ore:-

Odisha has about 28 percent of India’s iron ore. Iron ore deposits could well be Orissa’s passport to a bright future. With the upswing in the global demand for steel, which is obtained after the reddish-grey ore is put through a blast furnace, Orissa is the toast of the country and perhaps the world. There is an unprecedented flow of capital into the State from global giants such as South Korea’s Pohang Steel Company (POSCO) to domestic players such as Bhushan Steel, Jindal Steel & Power etc. Steel-makers are making a beeline to Bhubaneswar to sign memoranda of understanding (MoU) to set up intergrated steel plants. The huge deposits of iron ore State is expected to cater to needs of these companies. Besides iron ore (32.9 per cent of the country’s reserves), Orissa has abundant reserves of bauxite (59.95 per cent), chromite (98.4 per cent), coal (24.8 per cent) and manganese (67.6 per cent). End-use industries based on these industires have a wider scope of growth in the state.

Orissa Steel:-

Orissa Steel is an emerging sector that will supplement the industrial sphere of Orissa. The developing industries producing steel will dominate the economy of the state. The presence of raw materials in abundance in the region has resulted in attracting the big investors to the region. The large scale steel enterprises have opted to invest in the state of Orissa. The reasons behind the sudden interest of the steel plants like TATA Steel and Ruia’s Essar Steel are the large iron ore deposits in the districts of Keojhar. The state mines 58 percent of iron ore which is an important raw material for making steel. The state also has a ready market for the steel products. Labor and electricity in the state are cheap which account for a low cost of production. The infrastructure of the state is also well developed that facilitates the industrial sector. These factors have lured the reputed steel companies of the country to the state. With the global demand for steel growing, the Union Cabinet recently unveiled a new steel policy that seeks to shore up the per annum steel production from 38 million tonnes to 100 million tonnes by 2019-20. But going by the current rush for iron ore in Orissa, the country may achieve the target well before the deadline. The State Government assigned 49 MoUs with various domestic and foreign companies for production of more than 75 million tonnes of steel in the state thereby bringning investment to the tune of 198,149 crore rupees. Similier MoUs have been signed by the state Government for alumina-aluminium and cement projects in the state.

Directorate of Steel :-

A new Steel Directorate was set up on 15th of July 2016 as a composite Directorate under the administrative control of Steel and Mines Department. The Directorate will focus on Iron Ore based Industries located in Odisha with following key activities.

  • To coordinate with the steel industries in the state to assist in addressing the issues relating to such investments, in coordination with the IPICOL
  • To monitor the implementation of MoUs signed steel industries for expediting the investments.
  • To regularly interact with the existing steel units with a view to identifying the problems and issues relating to optimal capacity utilization.
  • To maintain a database on investments, production, employment etc. of Iron ore base industries in Odisha.
  • To monitor the availability of assured supply of raw material to the steel industries .
  • To assist the Department in policy matters relating to steel industry.

 

Major initiatives taken by the government to promote Odisha as an investment destination:

  • The Odisha government unveiled a strategic action plan for the implementation of the ‘Vision 2025’ which lays a road map for industrial growth in the state over the next decade during the recently concluded Odisha Investors meet in Bengaluru. The state has identified five focus sectors that include agro and food processing, chemicals and petrochemicals, textiles and apparel, downstream and ancillary industries in metal sector and electronic system design and manufacturing and IT/ITeS. The plan covers policy, infrastructure, investment promotion and skilling interventions that the state government plans to undertake for industrial development in these focus sectors.
  • The state government also launched an advance version of its industrial portal for land use and services i.e GOiPLUS. The GOiPLUS Version 2.0 provides information about the entire land bank available in the state for industrial use and works as a one-stop portal to provide information about all land related queries of an investor. Using the portal, an investor can get information about availability of land parcel in the vicinity of preferred infrastructure utilities such as airport, port etc.
  • Odisha government also launched its start up policy 2016 that aims to create 1,000 startups in the state by 2020.The policy will aim at providing incentives, support and assistance to start ups at all stages of development including idea or prototype stage, commercialisation stage as well as the marketing stage. The Odisha government has also set up a startup capital infrastructure fund upto Rs 25 crore that will be used to support development of startup ecosystem in the state.
  • In order to increase the employment opportunities in the state, Odisha government has announced plans to invest US$ 28.69 billion in the manufacturing sector generating nearly three lakh job opportunities by 2020.
  • In June 2015, in an effort to increase the traffic of foreign airlines in the state, the state government exempted the Value Added Tax (VAT) imposed on aviation turbine fuel.
  • In July 2015, the state government announced plans to frame a rural Business Process Outsourcing (BPO) scheme under which subsidies are planned to be offered for establishing BPO units. In places where STPI (Software Technology Parks of India) stations are situated, employment opportunities are expected to be generated in the state. STPIs in the state are located in Bhubaneswar, Balasore, Rourkela and Berhampur.
  • As per budget 2016-17, US$ 39.71 million has been proposed by the state government for developing new railway projects such as the ongoing Khurda-Bolangir line, new Jaypore-Malkangiri, Jaypore-Nabarangpur railway lines, etc. in the state through direct state funding.
  • As per state budget 2016-17, the state government allocated US$ 1.52 million for development and enhancement of eco-tourism in Odisha.
  • A biopharma IT park at Bhubaneswar is being established under the public private partnership (PPP) model over a land area of 64.68 acres.
  • A mega food park is being established near Bhubaneswar over 282 acres through the PPP mode. Odisha Industrial Infrastructure Development Corporation (IDCO) is the nodal agency for the establishment of this park.
  • In order to strengthen the artisan-based enterprises in the handicrafts sector, 19 handicraft training centres are functioning in different districts.