MAHARASHTRA State Report

MAHARASHTRA STATE ANALYSIS

MAHARASHTRALive life Maharashtra !!!

A REPORT ON MAHARASHTRA

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PROJECT PRESENTED

BY

NIKHIL SAYA

KHADER HUSSAIN

PAVAN KUMAR

ARUN KISHORE

NIKHILESH

UNDER THE GUIDANCE OF

Dr. E. MURALI DARSHAN

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PREFACE

Maharashtra has been the Leader on Industrial front in India. It has always

been the endeavour to develop sustaining industrial growth, facilitate speedier

flow of investment by creating conducive industrial climate in the State.

Maharashtra has developed solid base for industrial infrastructure, strong

human resources and diverse industrial base. This was possible because of

several initiatives, since inception in diverse fields.

There are various aspects or rather plus points for Maharashtra which has

made the State to be a leader in most aspects especially in Sectors like

Agriculture, Tourism, Mining, Engineering goods and Gem and Jewellery etc.

Maharashtra is supposed to be the Largest economy in the country, with a high

per capita income .It has Most attractive investment destination in the country,

accounting for 40 per cent of its exports .Maharashtra is also the Most

industrialised state, with strong presence of petrochemicals, automobiles,

financial services, IT/ITES and textile industries. This has been possible because

of large network of professional education institutions, presence of reputed

R&D centres and also Superior infrastructure.

This is the reason why most of the states follow some initiatives formulated

by Maharashtra and thus it is said “Live Life Maharashtra Way !!! ..”

CONTENTS

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FACTS 5

MAHARASHTRA OVERVIEW 6

STATE ECONOMY 8

AGRICULTURE AND ALLIED ACTIVITIES 12

TOURISM 19

MINING 24

ENGINEERING GOODS 26

PHARMACEUTICALS 32

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MAHARASHTRA

Capital Mumbai

Area (Sq.km) 308,000

Population(Census 2001,milion) 96.9

Literacy rate(%) 79.1(2007-08)

Human Development Index 0.523(All India 4th rank)

NSDP Growth(2006-07 to 2007-08) 16.1 percent

NSDP rate at current prices in 2007-08 Rs 5,04,951 crore

Annual Per Capita income at

current prices in 2007-08 Rs 33283

National highways length (km) 4367

Total Roadways Length(km) 235595

Railways length (km) 5917

International Airports Mumbai, Nagpur, Pune

Domestic Airports Nasik, Nagpur, Pune, Mumbai, Jalgaon,

Aurangabad and 10 more

Key Industries Financial Services, Textiles, Auto-ancillaries,

Chemical and allied products, Electrical and

Non-electrical machinery, Petroleum and allied

products. Wine, Jewellery, Pharmaceuticals,

Engineering goods, Media & Entertainment etc.

Industries with Potential growth Leisure and Entertainment, Bio-technology and Tourism

MAHARASHTRA STATE OVERVIEW

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Maharashtra occupies the western and central part of the country and has a long coastline stretching nearly 720 kilometers along the Arabian Sea. The Sahyadri mountain range provides a physical backbone to the State on the west, while the Satpuda hills along the north and Bhamragad-Chiroli-Gaikhuri ranges on the east serve as its natural borders. Maharashtra is the second largest State in India both in terms of population and geographical area spread over 3.08 lakh sq. km. The State has a population of around 10 crore (2001 Census) which is 9.4 per cent of the total population of India. The State is highly urbanized with 42 per cent people residing in urban areas whereas at national level it was around 28 per cent.The sex ratio of the State is 922 as against 933 for India.

The State has 35 districts which are divided into six revenue divisions viz. Konkan, Pune, Nashik, Aurangabad, Amravati and Nagpur for administrative purposes. Maharashtra has a long tradition of having very powerful bodies for planning at the district / local level. For local selfgovernance in rural areas, there are 33 Zilla Parishads, 351 Panchayat Samitis and 27,920 Gram Panchayats. The urban areas are governed through 22 Municipal Corporations, 222 Municipal Councils, 3 Nagar Panchayats and 7 Cantonment Boards.

The Gross State Domestic Product (GSDP) at current prices for 2007-08 is estimated at Rs. 5,90,995 crore and contributes about 13 per cent of the National Income. The GSDP has been growing at a rapid pace over the last few years. The State boasts of a very vibrant industrial sector and a rapidly growing services sector. Both these sectors presently contribute about 86 per cent of the state’s domestic product. The agriculture & allied activities sector contributes just 14 per cent of the state’s income though about 55 per cent of the population is dependent on income from this sector. Mumbai, the capital of Maharashtra and the financial capital of India houses the headquarters of almost all major financial institutions, insurance companies and mutual funds.

India's premier stock exchanges i.e. the Bombay Stock Exchange as well as the National Stock Exchange and the Commodity Exchanges are located in Mumbai.

The State has 225.6 lakh hectares of land under cultivation where cereals, pulses and other major foodgrains are grown. Forests cover another 52.1 lakh hectares. The extreme weather conditions, coupled with low quality soils and rain fed cropping results in lower agriculture productivity. Number of irrigation projects are being implemented to improve irrigation. A watershed mission has been launched to ensure that soil and water conservation measures areimplemented speedily in the unirrigated area.

The State has made rapid strides in the production of commercial crops like sugarcane, Soyabean, cotton, oilseeds and onions. The last few years have seen a healthy shift towards horticulture crops. The State is well known for its Alphonso mangoes, grapes, bananas, pomegranates and oranges.

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Animal husbandry is one of the important allied activity and has 24 per cent share in agriculture sector. The State’s share of milk, livestock and poultry population in India is 7.7, 7.6 and 7.0 per cent respectively. The long costal line is a boon to the State’s economy. The State contributes to 25 per cent in India’s total export of fish The State has been recognised as the country's industrial powerhouse and maintains the position of being the most industrialized state. The State is pioneer in SSI. The State continues to attract industrial investment from both, domestic as well as foreign institutions. It has become a leading automobile production hub and a major IT growth centre. It boasts of the largest number of special export promotion zones being set up in the country. During the year 2007-08, about 27 percent of the exports from the country are from the State.

The State is becoming one of the leading wine producing areas in the country. At present, 35 wineries are functioning with an investment of Rs. 109 crore and export of 22.49 lakh litres of wine. The State has given importance to primary education, which has resulted in consistent improvement in literacy rate. The literacy rate of the State is 77.6 per cent as against 65 per cent at national level during 2001, which increased to 79 per cent during 2007-08. Maharashtra is a pioneering state for female education in the country and during the same period the female literacy rate increased from 67 per cent to 71 per cent. The State has excellent higher educational institutions in the fields of engineering, medical and management. The State has well spread road network of 2,35,595 km. road length. All weather roads connect about 97 per cent villages. It has surface transport among the best and good connectivity via major sea ports and airports. It has highest installed capacity and generation of electricity in the country. All this has made this state a favoured destination for investment. The State is well known for its administrative acumen and innovative ideas. The State is first to implement woman’s policy and engendering the budget by establishing separate Woman and Child Development Department. It is pioneer in implementing its ‘Employment Guarantee Scheme’ and is replicated by the Government of India. Maharashtra is not just a geographical expression but an entity built on collective efforts of its people. Natural as well as cultural diversities have helped in the development of a unique Marathi culture. It has its own spiritual dimensions and known as Land of Saints. Saints of that time helped the cultural awakening of the region along with their spiritual contribution. Monuments such as Ajanta and Ellora, Gateway of India and Elephanta caves and architectural structures like Viharas and Chaityas have attracted people from all over to the world. Besides the wonderful monuments, segment mix of population and its cultural aspects makes it intra-national. It has produced many important personalities covering almost every aspect of human development. People in the State have excelled in sports, arts and literature. The world famous film industry, popularly called “Bollywood” is located in the State.

STATE ECONOMY

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The year 2008-09 witnessed a heavy turmoil in the global economy, which had an impact on the Indian as well as the State economy. The advance estimate released by Central Statistical Organisation (CSO) indicates that the Gross Domestic Product (GDP) is expected to grow at 7.1 per cent during 2008-09 as against 9.0 per cent during 2007-08.

The advance estimate of Gross State Domestic Product (GSDP) is expected to grow at 6.7 per cent during the year 2008-09 as against 9.2 per cent during the previous year. The lower growth projection is due to an expected fall in growth rate of industry to 4.8 per cent during 2008-09 as against 8.0 per cent during the previous year. Insufficient and an uneven rainfall had an adverse impact on agriculture & allied activities which will result in a negative growth of 7.1 per cent during 2008-09 as against 10.4 per cent in the earlier year. However, the services is expected to maintain the growth momentum and is likely to grow by 10.5 per cent during the year, thus cushioning the effect of downfall in the economy.

The preliminary estimate of GSDP at constant (1999-2000) prices was Rs. 4,16,248 crores during 2007-08, as against Rs. 3,81,247 crore in 2006-07, showing an increase of 9.2 percent. The GSDP during 2007-08 at current prices was Rs. 5,90,995 crore, showing an increase of 16.1 per cent over that of the previous year.

The preliminary estimate of the State Income i.e. Net State Domestic Product (NSDP) at current prices is estimated at Rs. 5,04,951 crore in 2007-08, higher by 16.1 per cent over the previous year. The per capita State Income at current prices is estimated at Rs. 47,051 in the year 2007-08, as against Rs. 41,144 during 2006-07.

The per capita National Income at current prices was Rs. 33,283 in 2007-08, as against Rs. 29,524 during previous year. The per capita State Income is higher than the National Income and the State ranks second after Haryana among the major states in India.

The average Wholesale Price Index (WPI) for 2008-09 was higher by 8.4 per cent over the previous year. The WPI was the highest in September, 2008, when the inflation rate was 12.3 per cent.

The Consumer Price Index (CPI) for rural and urban areas of the State also revealed similar trend as that of WPI. CPI for rural areas was 13.3 per cent higher than that for the previous year whereas in urban areas, it was higher by 12.8 per cent.

In recent years, the state finances have witnessed significant improvements due to consistent and cohesive measures undertaken by the State Government. This included the implementation of Value Added Tax (VAT), enactment of the Fiscal Responsibility and Budgetary Management (FRBM) Act, increase in plan expenditure, reduction in non-development expenditure, etc. The fiscal deficit, which was highest

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during 2002-03 at 5.8 per cent of the GSDP, has drastically declined to 2.6 per cent in 2006-07 and it is expected to decline further to 2.1 percent during 2008-09.

The revenue receipts of the State Government are expected to be Rs. 79,911 crore during 2008-09 as against Rs. 79,860 crore during 2007-08. The tax revenue of the State is expected to be Rs. 60,839 crore in which State’s own tax revenue is Rs. 51,893 crore (85 per cent). The non-tax revenue is expected to be Rs. 19,072 crore.

The revenue expenditure of the State Government during 2008-09 is expected to be Rs. 78,946 crore, higher by 19 per cent over the previous year, of which interest payment is Rs. 12,953 crore (16.4 per cent). The total outstanding debt during 2008-09 is expected to be Rs. 1,58,520 crore (25.8 percent of the GSDP).

The State ranks first in India in respect of both the aggregate bank deposits (Rs. 8,52,771 crore) and gross credits (Rs. 8,34,701 crore) as on the last Friday of September, 2008.

Self Help Group (SHG) bank linkage programme was initiated to improve credit delivery mechanism to the underserved and unserved rural poor, who had been so far bypassed by thebanking system. The amount deposited by 3.80 lakh SHGs was Rs. 267 crore as on 31st March,2008, whereas during 2007-08, the credit disbursed to 0.75 lakh SHGs was Rs. 325 crore. The outstanding credit with 4.10 lakh SHGs was Rs. 1,021 crore as on 31st March, 2008.

The State received 91 per cent of the normal rainfall during 2008. However, the intensity of rainfall was not sufficient in some parts of the State during sowing period which has resulted in lower production of kharif crops. Moreover, insufficient moisture caused fall in production of rabi crops.

The foodgrains production for kharif and rabi season in the State is estimated to be 117.19 lakh M.T. as a preliminary forecast, less by 24 per cent compared to that of the previous year. A steep fall of 49 per cent is expected in production of oilseeds. Sugarcane production is alsoexpected to be much lower by 43 per cent (at 508.13 lakh M.T.) mainly due to reduction of 30 percent in the harvested area.

To reduce the agricultural debt burden of the farmers, the Government of India (GoI) has aken an initiative through the ‘Agricultural loan exemption & loan rebate scheme 2008’. Under this scheme, 100 per cent loan of small and marginal farmers having land upto 2 ha. and loan amount upto Rs. 20,000 or 25 per cent of loan, whichever is higher, of farmers having land more than 2 ha. is waived. Under this scheme, 38 lakh farmers are expected to get benefit and loan to the extent of Rs. 7,872 crore is

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expected to be waived. To assist the farmers not covered under the above scheme, the State Government has implemented ‘Agricultural loan exemption and loan repayment exemption scheme 2009’, under which 40.15 lakh farmers are expected to be benefited with a total estimated amount of Rs. 6,208 crore.

The agricultural credit for seasonal agricultural operations is made available through the Primary Agricultural Credit Societies (PACS) under the co-operative network as well as the Commercial Banks and Regional Rural Banks (RRBs). The aggregate loans advanced for seasonal agricultural operations in the State during 2007-08, was Rs. 9,299 crore, of which the loans through PACS were Rs. 5,828 crore (63 per cent), through Commercial Banks were Rs. 3,172 crore (34 percent) and through RRBs were Rs. 299 crore (3 per cent).

The milk production in the State during 2007-08 was estimated to be 72.1 lakh M.T., which registered a rise of 3.3 per cent over the previous year. The average daily collection of milk by the Government and co-operative dairies (excluding Greater Mumbai) was 41.3 lakh litres upto December, 2008 which was 38.6 lakh litres during 2007-08. The estimated marine and inland fish production in the State was 3.6 lakh M.T. and 1.0 lakh M.T. respectively by the end of December, 2008 as against 3.3 lakh M.T. and 1.1 lakh M.T. respectively by the end of December, 2007.

Total 14,957 industrial projects with an investment of Rs. 5,04,689 crore and employment potential of about 27.54 lakh have been registered with the GoI to set up units in the State till the end of December, 2008. Out of these, 6,778 projects with an investment of Rs. 1,10,149 crore have already started their production and employment of about 6.93 lakh has been generated. The compounded annual growth rate (CAGR) for the last five years for investments in registered and commissioned projects is 16.1 and 2.6 per cent respectively.

Under Foreign Direct Investment (FDI), 4,041 projects with an investment of Rs. 75,096 crore have been approved by the GoI for setting up industries in the State by the end of March,2008. Of these, 1,659 projects with an investment of Rs. 39,291 crore were commissioned.

The total available installed capacity of electricity in the State at the end of March, 2008 was 21,654 MW as against 17,984 MW at the end of March, 2007. During 2008-09, the generation of electricity in the State upto the end of November, 2008 was 51,465 million KWH, higher by 6.0 per cent than that in the corresponding period of 2007-08. The State is facing a power deficit of about 4,500 MW. The transmission losses of MAHATRANSCO were 5.0 per cent and the distribution losses of MAHADISCOM were 24.1 per cent during 2007-08.

The total road length in the State was 2.36 lakh km. at the end of March, 2008 out of which the village road length was 1.02 lakh km. So far, 96.8 per cent villages were connected by all-weather roads, 2.4 per cent villages were connected by fair weather

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roads and remaining 0.8 percent villages (334) did not have road connectivity as on 31st March, 2008.

An ambitious project for setting up a world class Multi-modal International Hub Airport at Nagpur (MIHAN) is being developed by Maharashtra Airport Development Company Ltd. (MADC), the State owned company. The project covers development of existing domestic airport at Nagpur as an international Passenger and Cargo Hub Airport, along with a huge Special Economic Zone (SEZ) and with overall world class facilities such as road infrastructure, separate road and rail terminal that will handle 14 million passenger traffic and an estimated 8.7 lakh tonnes of cargo per year. The unique feature of this project is ‘Maintenance Repair Overhaul (MRO)’ base for comprehensive maintenance of aircraft, the first independent MRO in India.

According to Population Census 2001, literacy rate in the State was 76.9 per cent. It was 86.0 per cent and 67.0 per cent for males and females respectively. The results of NSS 64th round(July, 2007 to June, 2008), shows the literacy rate of the State was improved to 79.1 per cent and that for males and females were improved to 86.6 per cent and 71.0 per cent respectively. The sharp increase in female literacy rate, reducing gender gap in literacy, is a heartening feature of the State.

To encourage participation in education, various incentives are offered by the Government including fee concessions. The results of NSS 64th round, focused on participation in education, reveal that number of ST students availing these facilities are above 86 per cent. Sarva Shiksha Abhiyan (SSA) is successfully implemented in the State. A major achievement of SSA is successful reduction in dropout rate from 15 to 10 at primary stage and from 24 to 19 at upper primary stage during 2002-03 to 2007-08.

Sample Registration Scheme (SRS) shows improvement in the demographic indicators of the State. Birth rate (18.1), death rate (6.6) and infant mortality rate (34) in the year 2007 have declined from 18.5, 6.7 and 35 respectively in the year 2006.

The number of beneficiaries being covered under Supplementary Nutrition Programme (SNP) in rural and urban areas is increasing and percentage of children under various grades of malnutrition is decreasing. Percentage of normal children in tribal areas increased from 42.4 in 2006-07 to 49.9 in 2008-09 along with decrease in percentage of children in grade I to IV significantly, in the respective period.

The average daily factory employment in the State for the year 2007 was 13.8 lakh as against 12.8 lakh for 2006.

The estimated employment in the State, based on National Sample Survey, which was on rise till 2004-05 at 4.3 crore, declined to 4.1 crore in 2007-08 clearly indicating the footprints of recession.

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The employment provided under National Rural Employment Guarantee Scheme(NREGS) during 2008-09 was 4.2 crore persondays as against 6.0 crore person days provided under Employment Guarantee Scheme (EGS) and NREGS during 2007-08.

The poverty estimate provided by the Planning Commission of India, reveal that the poverty ratio in the State during 2004-05 is 30.7 per cent as against All-India average of 27.5 percent. Though the results at various points of time show decline in poverty ratios, the number of persons living below poverty line is gradually increasing since 1973-74 and increased by 12.2 lakh persons in 2004-05 as compared to 1993-94.

AGRICULTURE AND ALLIED ACTIVITIES

The total foodgrains production for kharif & rabi season in the State during the year 2008-09 is expected to be 11.7 million tonnes as against 15.4 million tonnes during 2007-08. At All-India level total foodgrains production was 219.3 million tonnes during 2007-08. The share of agriculture & allied activities in the GSDP during 2008-09 was 12.1 per cent and its share at the national level was 17.6 per cent. The share of agriculture & allied activities in GSDP is continuously decreasing from 22.1 per cent in 1980-81 to 12.1 per cent in 2008-09. However, agriculture remains most vital sector of economy as almost 55 per cent of the population in the State depends upon it for their livelihood.

Growth of agriculture sector is important for food security, rural employment and improving rural standards of living. The growth in agriculture largely depends upon the efforts made towards increasing the agricultural productivity by ensuring high quality inputs and use of modern and more advanced technology. In this endeavor, both the Central and State governments are playing a pivotal role in mobilizing resources,

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creating infrastructure, facilitating easy availability of inputs, supporting research and technology development, institutional support services and putting in place contingency measures to safeguard the crops from the adverse effects of natural calamities.

The productivity of important crops in the State is relatively low as compared to the productivity in other parts of the country. Productivity of crops (kg per ha.) for principal crops viz. rice, wheat, jowar, bajra and cotton during 2005-06 was 1,781, 1,393, 783, 650 and 187 kg per ha. as against 2,102, 2,619, 880, 802 and 362 kg per ha. respectively at All-India level.

Agricultural Production Prospects 2008-09

About 30 per cent sowing was completed in June 2008, 77 per cent by the end of July, 2008 and 100 per cent i.e. 134.04 lakh ha. by the end of kharif season. The areas under sunflower & soyabean increased by one per cent and 16 per cent respectively, while areas under maize, cotton and sugercane decreased by three per cent, two per cent and 30 per cent respectively. According to the preliminary forecast by the Commissionerate of Agriculture, Pune, total foodgrains production(kharif + rabi) in the State during 2008-09 is expected to be 117.19 lakh M.T., 24 per cent lower than the production of the previous year i.e. 153.66 lakh M.T. The details of the forecast of production of foodgrains and oilseeds are given in Table 1.1

Table 1.1 Estimates of food grains and oilseed productions

Crop 2007-08 (Final forecast) (lakh M.T)

2008-09 (Tentative) (lakh M.T)

Percentage change

Cereals 123.42 98.63 (-)21Pulses 30.24 18.56 (-)39Total food grains(kharif+ rabi)

153.66 117.19 (-)24

Oilseeds 47.61 24.33 (-)49Cotton 70.15 52.02 (-)26Sugarcane(in lakh bales of 170 kg each)

884.37 508.13 (-)43

Source: Department of Agriculture

During the year 2008-09, the area under foodgrains reduced by 20 per cent resulting in reduction of crop production by 31 per cent in total kharif foodgrains production. This fall was mainly in kharif jowar,

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bajra and all pulses. Fall in area and production was also observed in cotton (lint) and sugarcane and fall in production of oilseeds was seen. Below average rains during June & July 2008 has adversely affected growth of kharif crops. Delayed sowing of bajra, soyabean and heavy infestation of tobacco leaf eating catter piller on soyabean has affected their growth. Insufficient rains in eastern Vidarbha during September, 2008 have affected production of rice. During the year 2008-09, the area for rabi crops reduced by four per cent resulting in reduction of crop production by 13 per cent in this season. This fall was observed mainly in wheat, gram, all pulses and oilseeds due to less moisture in soil and adverse climatic conditions.

The index number of agricultural production for the State (Base: Triennial average 1979-82=100) for 2007-08 was 234.0, more by 31 per cent than that in 2006-07. The group wise indices for 2007-08 for cereals were 137.0, for pulses 303.9, for foodgrains 170.1, for oilseeds 94.9, for fibre 479.1, for miscellaneous 312.0 and for total non-foodgrains it was 305.1. It may be noted that the Compound Annual Growth Rate (CAGR) of agriculture production during last eight years (2000-01 to 2008-09) works out to only 1.8 per cent.

The gross cropped area in the State has increased by about 20 per cent from 188.2 lakh. in 1960-61 to 225.6 lakh ha. in 2006-07. The agricultural productivity has not increased much despite concerted efforts and large scale spending on soil conservation and watershed development works. The per ha. yield (958 kg.) of the State in respect of foodgrains for 2006-07 was far below the national average (1,756 kg.). It is, therefore, needed to focus on increasing the production and productivity of the foodgrains and also to ensure sustainable growth of agriculture sector.

LAND UTILISATION

As per the land utilisation statistics for the year 2006-07, out of the total 307.6 lakh ha.geographical area of the State, the gross cropped area was 225.6 lakh ha., net area sown was 174.8 lakh ha. (56.8 per cent), area under forest was 52.1 lakh ha. (16.9 per cent), land not available for cultivation was 31.3 lakh ha. (10.1 per cent), other uncultivated land was 24.2 lakh ha. (7.9 percent) and fallow land was 25.2 lakh ha. (8.3 per cent). During the period of last five years i.e. from 2001-02 to 2005-06 land put to non-agricultural usage increased by 2.4 per cent, while net area sown decreased nearly by one per cent.

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Graph showing Percentage distribution of land utilisation (2005-06) in State

A GLOBAL PERSPECTIVE ON AGRICULTURE

Agriculture plays a multifunctional role with every 1% rise in agricultural productivity cutting poverty by an estimated 0.6%. Notwithstanding this, world agriculture exports have not kept pace with the growth in exports of either manufactured products or mining products. Although world agricultural exports picked up in 2005 growing by 8.1% in value terms, they totaled only US$ 852 bn. Over the years, the growth in agricultural trade has been less strong than total merchandise trade, thereby resulting in its share decreasing from 12.6% in 1990 to only 8.6% in 2005. As against this, exports of manufactures have more than trebled from US$ 2.4 trillion in 1990 to US$ 7.3 trillion in 2005. Similar increase can be seen in the case of mining exports, which have risen from US$ 488 billion to US$ 1748 billion during the same period.

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Source: WTO Online Statistical database

Agriculture forms the backbone of the India economy contributing more than one-fifth to the GDP and providing livelihood support to about two-thirds of country’s population. In fact, it is the single largest private sector occupation. Any change in the agriculture sector has a strong multiplier effect on the entire economy. The multiplier for food industry is much higher than that for industries such as power and telecom, reason being that the food industry directly and indirectly triggers growth in a number of other industries such as transport, refrigeration, pesticides and fertilizers.

The most significant positive aspect of our agricultural exports is that a majority of the items in the agriculture export basket are net foreign exchange earners, with negligible import content unlike high import content in many manufactured products. Export of agriculture products increased from US$ 6.0 bn in 2000-01 to US$ 11.2 bn in 2006-07.

However, the share of agriculture and allied products in total exports has come down from 13.6% to 8.9% during the same period. During the period 2000-01 to 2006-07, India’s overall exports grew faster than agro exports. The difference has always been substantial except in 2001-02 where both experienced negative growths.

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India’s Agri Exports:

Source :CMIE India Trade Database

India’s major agro exports (apart from marine products) include rice, oil meals, cashew, spices, tea, and wheat. The non-traditional exports include horticulture and floriculture products such as vegetables, fruits and their processed products. Star performers have in fact been the traditional agro exports like basmati rice, oil meals and castor oil. To be precise, share of oil meals in India’s agriculture exports jumped to 8.6% in 2004-05 from 4.6% during 2001-02. Share of basmati rice also shot up from 6.3% to 7.6% during the same period. This was due to a significant average growth rates experienced over the last three years of 62% and 22%, respectively. This trend clearly reflects increasing importance of traditional agro exports, necessitating the need to diversify into non-traditional export products.

In terms of production, India, with an arable land of 162 mn ha remains a major player in the global market. India, with a production of 47 mmt of fruits and 80 mmt of vegetables, is the second largest producer of fruits and vegetables after China. In fact, the country ranks first in the production of banana and mangoes and second in eggplants. However, processing of fruits and vegetables is estimated at only 2% of total production. India’s agro exports have not been commensurate with its production. The fruits and vegetable sector has not leveraged on the export market as a proactive source of revenue. This clearly calls for a strategy that focuses on the international market, not as a residual but as a prospective source of revenues.

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POMOGRANATE –POTENTIAL EXPORT ITEM

Although India is the 2nd largest producer of fruits in the world and first in Pomegranate production with the total Pomegranate production in the world is 10 lakh tonnes out of which India produces 5 lakh tonnes but exports only 5000 tonnes, whereas Spain produces 1 lakh tonne and export 75,000 tonnes annually. Pomegranate is a high value crop and its entire tree is of great economic importance. Apart from its demand for fresh fruits and juice, the processed products like wine and candy are also gaining importance in world trade. Pomegranate is an important fruit crop of Maharashtra. It is cultivated in an area of 43,151 ha with a total production of 4, 31,510 tonnes producing about 85% of the total Indian production, thereby leading in Pomegranate production in the country. Within Maharashtra, production of Pomegranate is mainly concentrated in the Western Maharashtra region and the Marathwada region. The variety Ganesh, Bhagwa (Red Ruby) cultivated in Maharashtra is suitable for export purposes. At present fair amounts of exports of Pomegranate takes place from the state in Reefer containers by sea.

Pomegranate requires Good Agricultural Practices, Euregap Certification, Awareness among exporters for Export procedures, HACCP/ISO Certification etc and disease and pest management as per the recommended schedules by NRC Pomegranate, Sholapur will expedite the economical condition of the poor farmers and increase the pomegranate export from our country.

Pomegranate – A Global Scenario

The cultivation of pomegranate was introduced quite early in the Mediterranean and eastern countries like India. But in Spain, it was introduced after the Islamic influence there and it reached England in the thirteenth century. Much later, Spaniards took this important plant to the new world-Mexico and Florida. Its cultivation gradually spread to other countries too and now it is grown almost everywhere in the tropical and subtropical climate.

At the global level, Iran is the world's largest producer and exporter of pomegranates with an estimated annual production of 670,000 tons, In addition to Iran, other countries including India, Turkey, Spain, Tunisia, Morocco, Afghanistan, China, Greece, Japan, France, Armenia, Cyprus, Egypt, Italy and Palestine also cultivate this product. Pomegranate is native to Iran, although its wild forms are found in India, Afghanistan and Syria. Presently good quality pomegranate comes from Turkey, Iran, Afghanistan, Syria,Morocco and Spain. In India, Sholapur is famous for juicy pomegranate fruit known as Anar. In Turkey pomegranates are served during important feasts.

The global figure for trade in pomegranate can at best only be estimated, considering that the data for disaggregated level through UNCTAD’s COMTRADE and PC TAS database (only sources of reliable data on international trade) is available at HS 6 digit level. Pomegranate comes at the 8 digit HS level under the 6 digit HS code 081090 (Other fresh fruits nec). Global exports under this 6 digit level amounted to US$ 751.4 mn in 2005-06 as against US$ 558.6 mn in 2003-04. Assuming that 25% of exports under this category comprises pomegranate, one can work out a rough estimate of global exports of pomegranate at

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US$ 188 mn in 2005-06. The main exporters under this category include Thailand, Spain, the Netherlands, Hong Kong and France.

2002-2003(US$ 3bn) 2003-2004(US$ 12 bn)

POMOGRANATE EXPORTS DURING 2002-03 AND 2003-04

As against this, India’s exports of fresh pomegranates amounted to US$ 12.8 mn in 2005-06, up from US$ 3.0 mn in 2002-03, thereby registering an impressive compound annualgrowth rate of 62.8%. The major export destination for India’s pomegranates are UAE, the Netherlands, UK, Belgium and Saudi Arabia. As is evident from the above exhibit, during the period between 2002 and 2006, the export destinations for pomegranates has more or less remained same except for the shares of Netherlands and Belgium, whichhave become important destinations for the country’s pomegranate exports. Further, the country’s dependence on UAE as the largest destination has reduced. Thus, India’s share in global exports of pomegranates is about 6.4%, although the country is the largest producer of pomegranates. This clearly calls for making the product more export oriented, particularly in light of the fact that per unit realization in international markets is far higher than the domestic market.

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TOURISM

Tourism, from the ancient times has fascinated mankind and is now perceived as an integral part in the modern day social life. The tourism phenomenon has attracted almost the entire world. Speedy development in means of transport and communication has made distant places on this earth practically accessible to wider segments of the population around the globe. It provides an opportunity to millions to enjoy the prospect from moving from one continent to another in a matter of hours.

All modern countries have progressed towards life styles, which favour the growth and development of tourism. Along with industrialization and rapid advancement in technology, Tourism industry has also grown rapidly throughout the world. Since mid 60’s international tourism has become the number one item of international trade.

Globally, tourism accounts for 11 % of the global Gross Domestic Product (GDP) and 5.3 % of India’s GDP1. One of the major reasons for the growth in the tourism sector is the overall economic development in the country.

Growth in GDP and Tourism in India (GDP at 1993-94 prices)

DOMESTIC AND FOREIGN TOURISTS VISITS 2001-2003

From the above data it can be said that growth in GDP and Forex earnings through tourism go hand in hand and that the increase in Forex earnings through tourism results in increase in GDP. It also implies that economic development of a region is directly proportional to the growth of tourism in that region. In developed as well as in developing economies all over the world specially the European and South-East

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Asian countries, rapid economic development could take place because of foreign tourists inflow which increased continuously. Promotion of tourism thus offers a key to economic growth. The GOI and many state governments have therefore initiated vigorous efforts at promoting tourism. The government of Maharashtra has also tried to promote tourism in the state through the MTDC. Maharashtra, literally means, the Great Nation. As the name itself suggest Maharashtra has a great diversity of riches to offer to the tourists in western India. The state encompasses an area of 3,07,762 Sq. km and occupies 9.36 % of total area of land of India2. It is the third largest state in India after Rajasthan and Madhya Pradesh and has 35 districts.

Maharashtra’s socio-economic profile in general and its economy in particular have undergone enormous changes. It presently accounts for about 13 % of the National GDP. Its per capita income is more than the national per capita income. It has a per capita income that is about 39 per cent higher than the country’s. The State of Maharashtra has the largest economy in the country. Its Gross Domestic Product (GSDP) at current prices stood at Rs.3,71,877 crore in the year 2004-054. Apart from material prosperity, the state has a rich cultural heritage and geographical diversity to attract tourists. Maharashtra has 720 kms. stretch of long coastline with Arabian sea. About 80 % of India’s cave temples are located in Maharashtra. 70% of these temples i.e., more than a thousand monuments were created as early as 250 B.C. and 300 A.D.

Therefore, any tourist has a spectacular set of options not just Super beaches - Cool hill stations –Hot spas–Holy shrines –Wild life parks- but also Philosophy, Culture, Craft, Music, Dance and Drama, Heritage sites, Architecture, Healing techniques etc. Thus the overall atmosphere is conducive for the tourism development..The Maharashtra Tourism Development Corporation Limited (MTDC) was incorporated in 1975 under the provisions of The Companies Act 1956 with a view to promoting and developing tourism in state of Maharashtra5. However, it is worth understanding that the issue of promoting tourism is linked to the issue of tourist satisfaction.

ARTS AND CRAFTS

The growth of crafts in society is a sign of the cultivation of sensitivity and the stirring and mellowing of humanism. It stands for man's endeavour to bring grace and elegance into an otherwise harsh and drab human existence. Actually, man's elevation from gross animal existence is marked by his yearning for something beyond the satisfaction of mere needs and creature comforts. It is the yearning that found natural expression in crafts.

This tradition of carved wooden frames and carved wooden balconies supported by brackets of animals, birds, and human forms is a part of architectural design of homes, palaces and temples as well as other community places built all over India

Since our contemporary architecture is totally changed and has no place for any carvings or others crafts, the craft of wood carving gradually disappeared and with that vanished all our craftsmen.

George C. M. Birdwood published his book, 'The Arts of India' in 1880, in which he had given plenty of information about, the then prevailing crafts in Maharashtra. Several crafts mentioned by him are not being executed today. But some major which have survived or have been revived and handed down to the present generation of craftsmen were also going through a difficult period due to lack of patronage, because under the British rule, the lifestyle of patrons of arts and crafts was also undergoing a great change.

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A good deal of inlay work was being conducted in Bombay in the latter part of the 19th Century. This inlay was made up of tin wire, sandal-wood, ebony, sappan (Brazil) wood, ivory, white, and stained green and stag horn. "Bombay inlaid work" was familiar for ornamental furniture such as book-stands, work-boxes, blotting- cases, ubiquitous glove, boxes and card cases, which go by the name of "Bombay boxes".

Crafts of Maharashtra Metal work in copper, brass and other alloy was being conducted in several places in Maharashtra for centuries. Old records reveal that there was a large manufacture of idols in all the metals at Nasik & Pune. Good brass utensils were also made at Kelshi and at Begmandli in the Ratnagiri Collectorate. Bombay Copper Bazaar was also equally known as recorded by Birdwood. He had observed that: "The most active industry in the town of Bombay is the manufacture of brass and copper pots and other utensils in universal use among natives of India. The Cooper Bazaar opposite Mombadevi Tank is the busiest and the noisiest, and one, of the most delightful streets in all the native town. Mr. Terry states (Maclean's Guide to Bombay) that, there are 1,069 coppersmiths, and 1,536 blacksmiths in Bombay.”

Mashru is a mixed variety of striped cotton and silk weave. It was generally used by the ladies as an undergarment. The basic warp is of silk and the weft is of various colored cottons. The term mashru is derived from share, meaning "legal". The weaving of pure silk fabrics at prayers was prohibited among the Muslims and hence this pattern was introduced. Paithan and Aurangabad were the famous centres of mashru production. Himroo is a similar variety of mixed silk and cotton but with a texture that is almost as fine as muslin. It is used as veils, head-dresses, bridal robes and saris. It is costlier than mashru. Paithani is the most costly high quality silken gold embroidered textile which has an interesting history. Paithani is called as Mahavsatra.

FORTS

Standing as silent sentinels to history are the 350-odd forts of Maharashtra. Beaten by the sea waves, lashed at by the torrential Deccan rains, or scorched in the blazing sun, stand imposing ramparts and crumbling walls. The last lingering memories of Maharashtra's martial times. Nowhere in the country would you encounter such a profusion of forts. And such variety Sited on an island, as at Murud-Janjira or guarding the seas as at Bassein, or among the Sahyadri hills, as at Raigad, whose zig-zag walls and rounded bastions sit like a sceptre and crown amidst hills turned mauve. Most of the forts in Maharashtra whether up in the hills or near the seas are associated with Shivaji --the great Maratha warrior and an equally great fort builder. Moreover, these forts were treated as mini-cities, such as Panhala, which is now a hill station. The concept of the fort-city was, however, not peculiar to Shivaji alone. The Portuguese who came to India as traders and missionaries, built within a century of their coming, Bassein, a garden city to rival many a European capital. Today, these forts numbed by sun and sleet, have not only been witness to changing times, but have also shaped them and within their walls throb the heart-beat of history. Maratha Forts Beyond the walls.

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CAVES

Dating back to the 2nd BC and artistically built over a few centuries, the Caves of Maharashtra have an extraordinary appeal and aura. Nestled in the formidable Sahayadri Mountain Range, these caves have been home to monks of different religions.

Be it the paintings in the Ajanta caves or the sculpture of the Ellora caves, or the divine presence in the Elephanta caves, the visitors have always and will always continue to be spellbound. These caves offer a visit that is truly unforgettable. A visit that will induce a sense of discovery, a discovery of the self, and of the divine.

TOTAL NO: OF VISITORS TO CENTRALLY PROTECTED MONUMENTS

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THE HOLY CITY NANDED

"The Lord has sent me into world for the purpose of spreading Dharma (Righteousness) every where and to destroy the evil doers root and branch. Know ye holy men! I have come solely for the purpose of establishing Dharma, protecting the Saints and completely uprooting the wicked men." History of Nanded Nanded is one of the historical places in Marathwada region of Maharashtra State. It is situated on the north bank of Godavari River. It is famous for Sikh Gurudwaras. Nanded is a town of great antiquity. It is said that during the Puranic days, Pandavas traveled through Nanded district. Nandas ruled over Nanded through generations. In 1708, Guru Govind Singh the tenth spiritual leader of the Sikhs came over to Nanded, his permanent abode. It was he who preached amongst the Sikhs that there need not be any spiritual leader for them and they should take Granth Sahib as their leader. A monument has been constructed at the place where he breathed his last. A Gurudwara has also been constructed there. It is known as Shri Huzur Abchalnagar Sachkhand Gurudwara.

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MINING IN MAHARASHTRA

The potential mineral bearing area of the State is about 58 thousand sq. km. Among the major minerals found in the State. The production of coal during 2009-10 was 28.8 million tonnes, 3.8 per cent more than that during the previous year. During the same period, the production of manganese ore increased by 2.3 per cent to 3.6 lakh tonnes.The value of minerals extracted in the State during 2009-10 was about Rs. 2,143 crore, in which share of coal was about 94 per cent (Rs. 2,018 crore). Maharashtra State Mining Corporation Ltd.(MSMC) is a limited company fully owned by the Government of Maharashtra incorporated under Companies Act, 1956 on 14th November, 1973 with the main objects. Now a step towards expansion of the on-going projects, opening new mines and diversification to mineral based industries. Minerals in Maharashtra Sr. No District Minerals

01 NagpurManganese, Coal, Dolomite, White clay/yellow ochre/Red ochre, Sand (stowing), Quartz Quartzite.

02 ChandrapurCoal, Iron ore, Limestone, Dolomite, White clay/Yellow ochre, Sand (stowing), Shale, Fluorite.

03 Gadchiroli Iron ore.

04 BhandaraManganese, Iron ore, Chromites, Kainite/Sillimanite/Pyrophyllite/Corundum, Quartz Quartzite, Sand.

05 Gondia Quartz and vanadiferous iron ore.

06 Yavatmal Coal, Limestone, Dolomite, Sand ( stowing).

07 Amravati Fire clay.

08 SindhudurgIron ore, Bauxite, Silica sand, Dolomite, China clay, fire clay, Feldspar, Graphite.

09 Ratnagiri Bauxite, Silica sand.

10 Kolhapur Iron ore, Bauxite

11 Raigad Bauxite

12 Satara Bauxite

13 Thane Bauxite

MINERAL RESERVES IN MAHARASHTRA

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Sr.No Mineral DistrictTotal Reserves ( in Million Tonnes)

01 Coal Chandrapur 2904.674

02 Limestone Chandrapur 750.325

03 Manganese Ore Bhandara 11.464

04 Iron Ore Bhandara 4.65

05 Kyanite Sillimanite Bhandara 2.618

06 Pyrophyllite Bhandara 0.995

07 Bauxite Satara 30.145

08 Silica and Sea Sand Sindhudurg 50.757

09 Copper Ore Chandarapur 6.40

10 Chromite Bhandara 0.480

11 Dolomite Nagpur 28.740

Yavatmal 29.810

12 Vanadium ore Gondia 4.65

13 Tungstone ore Nagpur 19.98

14 Zinc Ore Nagpur 8.27

15 Quartz Bhandara 2.123

16 Granite Chandrapur 24.00

Bhandara 178.00

MINERAL BASED INDUSTRIES IN THE STATE

Sr.No Name of Industry Plant Location & District Capacity Source Mineral Deposit

01M/s Sunflag Iron & Steel Co.Ltd.

Dist. BhandaraMild Alloy & Steel Rolled Products 1.6 Lakh Tonnes/year

Iron ore deposits of Chadrapur & Gadchiroli dist.

02M/s Manganese Ore(i) Ltd.

Chikli Dist. BhandaraElectrolytic manganese Dioxide 700 Tonnes/year

Manganese deposit Chikla, district Bhandara.

03M/s Uniferro International

Dist. BhandaraSilico-managanese 45,000 Tonnes/year

Quartz & Manganese deposits of Bhandara district.

04M/s.Universal Ferro & Allied Chemicals Ltd.

-----do----Silico-managanese 15,000 Tonnes/year

Quartz & Manganese deposits of Bhandara district

ENGINEERING GOODS

The engineering industry has been titled the ‘engines of growth’. The tremendous impact and influence it has on industrialization and consequently the economy can be clearly seen from the economic scenario the

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world over. It has catapulted many nations like Japan, Germany, USA, UK, etc into frontline industrial nations within a very short time. India too has found this industry very responsive and eager to take up any stimulus to growth. Importance of engineering industry in India can be gauged from the fact that it employs over 3 million people and accounts for nearly one-third each of productive capital, value added and output in the organized sector that contributes substantially to both the production and exports of engineering goods.

The engineering sector has emerged as the largest contributor to India’s merchandise exports, even ahead of gems and jewellery. Export of engineering goods crossed US $13 billion during April to October in 2006-07, an increase of 29% compared to corresponding period last year. At this rate, engineering exports would touch $ 24 billion in 2006-07 and this would be the highest among all items in overall merchandise exports from India, Shri Rakesh Shah, Chairman, Engineering Export Promotion Council (EEPC), has said.

During the last five decades, Council has played a pivotal role in transforming the profile of Indian engineering exports. Engineering exports which were a meagre US$ 10 million in 1956-57 have now reached US$ 20.34 billion in 2005-06. The share of engineering goods in the total merchandise exports from India has also gone up from mere 0.5% to 20% during this period which is also the largest among all product groups, while the membership strength of the Council has increased from 40 in 1955 to 12415 in 2006.

The Government had announced three stimulus packages on December 7, 2008, January 2, 2009 and February 16, 2009 (in the Interim Budget for 2009-10) to provide support to the industries impacted by economic slowdown. These industries included the labour intensive industries. The measures to stimulate domestic demand inter-alia include reduction in ad-valorem CENVAT duty, incentives to the housing sector with a view to give a boost to affordable housing, and sector specific initiatives. Further, a set of measures were announced for enhancing the flow of funds to the MSE sector.

The various measures to support exports included interest subvention of 2% for pre & post shipment export credit for identified labour intensive industries, additional allocation for export intensive schemes, additional funds towards providing guarantee by the Export Credit Guarantee Corporations and enhancements of duty draw back benefits on certain identified exportable items. In addition, RBI has taken a number of steps to reduce the cost of credit and improve liquidity for the industry such as reduction of the Repo rates, reverse Repo rates, Cash reserve ratio etc.

With the requirements of the corporate sector located in and around Mumbai being met by Exim Bank's Mumbai offices, the Pune office will be offering the Bank's comprehensive range of financial products and services to exporters in other areas of Maharashtra like Pune, Kolhapur, Nagpur, Nashik, Ahmednagar, Aurangabad, Satara, Sangli, Alibag, Ratnagiri. These regions account for a sizeable part of exports from Maharashtra. Pune alone accounts for around 35% of engineering exports from Maharashtra. Moreover, Pune, Nashik and the Konkan area account for around 57% of food and agro exports from Maharashtra. Again, Pune, Nashik, Aurangabad, Kolhapur and the Konkan area accounts for around 53% of chemical product exports from Maharashtra. Besides, Pune is one of India's major software development centres registering exports of around Rs. 550 crores in the year 1998-99. With focus on the software, chemical,

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engineering, and food/ agro industrial sectors, the Bank's Pune office is expected to play a significant role in catalysing incremental exports of these product groups.

For the FY 1998-99, Exim Bank posted a net profit of Rs. 239.99 crores (19% increase over the previous year), while the net worth increased to Rs. 1335.21 crores - up from Rs. 1205.67 crores. The Bank has proposed a dividend payout of Rs. 33 crores to the Government of India after providing for tax of Rs. 75 crores.

Exim Bank's Pune office fulfills a long standing requirement evinced by exporters in this region to have the country's apex financial institution supporting exports as a next door neighbour. The Bank is confident that its new office in Pune will contribute to increasing exports from Pune and surrounding regions of Maharashtra and Goa.

Lathe machines are mostly used in Pump Industries, Textile Industries, Paper Industries, Automobile Industries, Govt. and Private Technical Institutions and in General Workshops. Most of the Lathe machines are exported to the Gulf countries. Almost all the lathe machines are exported from India are exported thought Mumbai port Heavy Duty, Medium Duty, Extra Heavy Duty and Special Purpose Lathe Machines are receiving unbelievable response internationally.

The vast range of lathe machines that includes:

Heavy Duty Lathe Machines:- 5'.3" to 25'.00" Medium Duty Lathe Machines:- 4'.6", 5'.3", 6'.00" Extra Heavy Duty Lathe Machines:- 7'.00" to 32'.00" Special Purpose Lathe Machines:- Customized Lathe Machines and Pipe Boring Machines.

Engineering Export Promotion Council (EEPC) was set up in 1955 under the sponsorship of Ministry of Commerce, Govt. of India, for export promotion of engineering goods, projects and services from India. Initially started with a few hundreds of engineering units as an small outfit, with a passage of time it has grown to be the largest Export Promotion Council having membership of nearly 12,000 from amongst large Corporate Houses, Star Trading Houses, Small & Medium Scale Units (SME), Trading Houses, etc. Out of the total membership of the Council, 60% constitutes the SMEs.

The steady growth in the export of engineering goods from India has been the continuous innovation and setting up quality standards in manufacturing and in delivering services – this is evident as a large number of exporters are ISO 9000 or equivalent accredited. EEPC – right from its inception has been insisting the exporting community on the quality parameter – and the Council itself has the distinction of achieving the ISO 9002 accreditation from world renowned KPMG. This has further been upgraded to ISO 9001:2000 for designing and organizing exclusive Indian Engineering Exhibitions abroad.

Engineering exports from India has been steadily growing and the performance has probably exceeded all expectations ever since the birth of the Council. Apart from being one of the largest stakeholders in the total exports out of India, – the engineering exporters are the foremost net foreign exchange earner in the country. As the engineering sector is extremely diversified, the Council has set up different Product Panels with a view to ensure that all possible & potential Indian products reach out to the global markets. EEPC aggressively peruses a number of activities & services for its exporting community, its members &

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the potential overseas buyers with a two-point objective of facilitating exports of Indian engineering products & services to the global market and to provide the overseas buyers true value.

The marketing activities of the Council are manifold and in addition to direct marketing, structured promotional events are organized on a regular basis so as to create awareness on the capability of Indian engineering exporters. The various promotional activities carried out on a regular basis are product specific delegation to select countries, exclusive Indian Engineering Exhibition, country participation in Specialized Trade Fairs, Catalogue Show, Buyer-Seller Meets, Product Specific Seminars and Conferences - both in India and abroad.

Publicity & Promoting the ‘Made in India’ brand Organizing INDEE / INDIATECH Exhibition Participates at leading Exhibitions and Trade Fairs Seminars and Conferences Trade Delegations and Buyer-Seller Meet Trade Informatic Division (TID) Foreign Offices of the Council The India Engineering Center Export Related Services to Members Services to the Overseas Buyers

Export Performance

During last five decades, EEPC has been playing a pivotal role in increasing country’s engineering exports and as of date, engineering exports have crossed US$ 20 billion in the year 2005-06 in comparison to US$ 10 million that was achieved in the year 1956-57. Engineering exports have been registering steady growth each year and has registered a growth of 27.50% during 2005-06 over the previous year. It is notable factor that SMEs contribution to total engineering exports is about 40%. This sector is the foremost net foreign exchange earner of the country.

Export Performance

During last five decades, EEPC has been playing a pivotal role in increasing country’s engineering exports and as of date, engineering exports have crossed US$ 20 billion in the year 2005-06 in comparison to US$ 10 million that was achieved in the year 1956-57. Engineering exports have been registering steady growth each year and has registered a growth of 27.50% during 2005-06 over the previous year. It is notable factor that SMEs contribution to total engineering exports is about 40%. This sector is the foremost net foreign exchange earner of the country.

Transformation Diversification Trend Average Growth Target

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Among the Third World countries, India is a major exporter of heavy and light engineering goods, producing a wide range of items. The bulk of capital goods required for power projects, fertilizer, cement, steel and petrochemical plants and mining equipment are made in India. The country also makes construction machinery, equipment for irrigation projects, diesel engines, tractors, transport vehicles, cotton textile and sugar mill machinery. The engineering industry has shown its capacity to manufacture large-size plants and equipment for various sectors like power, fertilizer and cement. Lately, air pollution control equipment is also being made in the country. The heavy electrical industry meets the entire domestic demand.

Indian Engineering Community considers quality as the very essence of successful marketing of any product. Majority of Indian engineering firms are pursuing a systematic approach to quality control and standardization so as to carve out market position in the competitive world market place. Engineering industry in India has been constantly upgrading its technology base and diversifying its manufacturing range in tune with global market requirements. More than 2500 firms from the engineering sector have already acquired ISO 9000 accredition in areas such as casting and forging, automobile parts, machine tools, electrical machinery, primary iron and steel products, industrial machinery, IC engines, pumps, textile machinery, etc. to name a few. Simultaneously, Indian exporters are not lagging behind in adopting eco-friendly manufacturing techniques, which have become the word in developed world.

ENGINEERING AND MACHINE TOOLS: STATUS OF INDUSTRY

Over the years, engineering industry in the country has registered a phenomenal growth to generate a strong base in a wide range of heavy and light engineering industries covering a broad spectrum of capital goods and consumer durable products. Bulk of capital goods required for power projects, fertilizer plants, cement plants, steel plants, mining equipment and petrochemical plants are being met from indigenous production. Construction machinery and equipment for irrigation projects, diesel engines, pumps and tractors for agriculture, vehicles, etc., transport are also being met from within the country. Engineering industries have also demonstrated their capacity to manufacture large size plants and equipments for various sectors such as power generation,fertilizers and cement.

The sale of construction equipment & machinery, cement machinery, chemical machinery and agriculture machinery were Rs. 1544 million, Rs.1353 million, Rs.18.52 billion and Rs.3480 million respectively in year 1999-2000.

EXPORTS

Indian engineering industry has shown commendable performance on the export front over the year. Engineering exports went up from US$ 22 million in 1960-61 to US$ 6781 million in 2000-01. There has also been a marked shift in commodity composition as well as direction of exports. Developed markets of the West now account for 40% to total engineering exports, as against 9% in 1960-61.USA has emerged as the largest single buyer for Indian engineering products accounting for 18% of total exports. Other major markets include UK, Germany, Hong Kong, UAE, Singapore, and Malaysia. As regards composition, capital goods sector presently occupies a pride position. Its share to overall engineering exports has increased from 13% in 1960-61 to more than 33% in 1996-97. The same is also true for subcontracting items, such as forged and cast components, which offer unlimited prospects, on long-term basis, in industrialized countries all over theworld.

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JOINT VENTURES/TURNKEY PROJECTS

Indian engineering industry has also been actively participating in the industrialization programmes of the developing countries. Several joint ventures have been set up in various countries, particularly, African plant and equipment, intermediate technology products. Indian engineering industry has also been successful in supplying turnkey projects for manufacturing several items of mass consumption like cement, paper, textile, etc.

QUALITY CONTROL/STANDARDISATION

Indian Engineering Community considers quality as the very essence of successful marketing any product. Majority of Indian engineering firms are pursuing a systematic approach to quality control and standardization so as to curve out market positioning in the competitive world market place. Engineering industry in India has been constantly updating its technology base and diversifying its manufacturing range in tune with global market requirements. More than 2500 firms from the engineering sector have already acquired ISO 9000 accredition in areas such as casting and forging, automobile parts, machine tools, electrical machinery, primary iron and steel products, industrial machinery, IC engines, pumps, textile machinery, etc. to name a few. Simultaneously, Indian exporters are not lagging behind in adopting eco-friendly manufacturing techniques, which have become the buzzword in developed world.

Major manufacturers of machine tools have now developed CNC machine tools such as machining centers, milling centers, turning centers etc. The machine tool industry has also commenced production of high productive machines such as industrial robots, flexible manufacturing system, etc. Indigenous industry is not only exporting general-purpose machines to advanced countries but have also commenced export of CNC machine tools. Overall production of machine tools has increased from just under Rs. 10 million in 1950-51 to Rs.15.20 billion in 1999-2000. Major export markets for machine tools are USA, Germany, Bangladesh, UK, UAE and Italy. The exports of construction equipment & machinery, cement machinery and agriculture machinery were Rs. 7.0 million, Rs. 23 million and Rs.566.0 million respectively in year 1999-2000.

ENGINEERING INDUSTRY IN MAHARASHTRA

Maharashtra occupies an important place in both production as well as exports of engineering goods from the country. Engineering industry in the state is highly diversified and produces a large range of parts to industrial machinery to industrial castings and forging. The state has a fairly large number of firms in the organized sector possessing world class manufacturing capabilities and cost structures, besides a vast number of small and medium engineering firms.

The industry, which was initially concentrated in the Mumbai-Pune belt, has spread all over, the State, the major production centers being Nagpur, Aurangabad, Nasik, and Kolhapur. The major engineering items of production and exports in Maharashtra are textile mill machinery, machinery for sugar, cement, and chemical plants, food processing machinery, construction machinery, tractors for agriculture purposes, electric power machinery, transmission line towers and accessories, fabricated steel like freight containers, automobiles, steel forging, steel castings, bright steel bars, stainless steel product,

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auto parts, cutting tools and files, internal combustion (IC) engines and compressors, machine tools, mechanical pumps and ship and ship buildings.

Total exports of engineering industry in Maharashtra have been estimated at US$ 900 million during 1996-97. This accounts for over 21 per cent of total export of engineering products in the same year. However, the products which have high potential of exports from Maharashtra include industrial castings forging, complete vehicles including two/three wheelers automobile parts, machine tools, industrial machinery, steel tubes, diesel engines, pumps, valves, compressors, seamless tubes and switch gears. These products have been identified considering current and future production technology scenario and exports. The major competing countries for most of the engineering products exported from the state are Japan, South Korea, Taiwan and China besides West European and North American countries. In overall terms, the export outlook for engineering products is bright. The shift in favour of value added items is getting pronounced from the fact that export growth of these items is high against negative growth in respect of prime iron and steel. Maharashtra and Gujarat will continue to dominate this industry with more than half the nation’s output and value addition. The Maharashtra Government has taken the right steps by introducing stringent pollution control laws.

PHARMACEUTICAL INDUSTRY

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Biopharmaceuticals in Maharashtra

Cluster History & Development

The Western region has been a major base for the Indian pharmaceutical industry for more than a hundred years and houses leading national companies like Wockhardt, Nicholas and Intas as well a number of large international companies including GlaxoSmithKline, Novartis, Pfizer, Johnson & Johnson, Abbott, Aventis Novo Nordisk, etc. Almost all the traditional pharmaceutical companies are now engaged in research and production of biopharmaceuticals mirroring global trends. One of the oldest Indian firms and largest biopharmaceutical company in the country, the Serum institute of India, is based in Pune. The Institute is the largest manufacturer of vaccines and sera in the world and claims to reach one fourth of the world’s children2 Today companies located in Maharashtra account for 35% of India’s biotech revenues with Pune and Mumbai as the combined center of the industry in the state.

Source-BioSpectrum India, August 2008

The development of the biopharmaceutical cluster in Maharashtra can be broken up into three stages- 1) Pre-independence, 2) 1947 to 1990, 3) 1991 to current corresponding to major political events such as India’s independence (1947), Balance of Payment Crisis (1990).

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MAHARASHTRA STATE REPORT

Source-Team Analysis

The pre-independence production of biopharmaceuticals was mainly oriented to serving the needs of British soldiers stationed in India. In the years that followed independence, the Central Government followed a policy of import-substitution to reduce India’s dependence on costly foreign drugs. During this period a number of public sector firms (Hindustan Antibiotics Limited, 1954) and Central Scientific Research Organizations were established in Maharashtra, laying the ground for the development of the pharmaceutical and biotech clusters in the state. The government’s policy also benefited firms like the Serum institute (1966) that was started by horse-trader Cyrus Poonawalla with 10 scientists from the Haffkine Institute. Post liberalization, the playing field for foreign and domestic firms became more level. This period has been characterized by an increase in exports, research partnerships, mergers and acquisitions.

Maharashtra Biopharmaceutical Cluster Diamond

FACTOR ONDITIONS

Maharashtra has a large pool (173,894 engineering graduates per annum) of low cost English speaking skilled labor. The presence of one of the 6 Indian Institutes of Technology in Mumbai is the clearest example of a regular supply of local highly talented technical excellence. The challenge of ‘brain drain’ is however one that must be overcome if the cluster is to move up the value chain from process replication to ‘original’ research and development.

Whilst the focus of the cluster is Pune, the importance of Mumbai for both its international airport and its role as a center of the Indian financial community is important to the evolution of the biopharmaceutical cluster. The nature of biopharmaceutical as a high risk endeavor means that the proximity to the venture capital in Mumbai is a crucial factor for the long term investment required. In addition to the existence of the airport, the lack of restrictions on

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biological imports allows the biopharmaceutical companies to source supplies that cannot be easily obtained locally.

These positive factors offset the deficient general infrastructure notably hazardous roads and unreliable electricity supply. The existence of over 3 biotech parks, encouraged by both the state and central governments, is critically important as these provide the independent electricity generators that ensure the consistency of supply that is critical to biopharmaceutical production. The superior amenities of the parks allied to local low cost equipment fabrication translate to a cost advantage for the producers. Without these amenities producers would not be able to maintain the sterile environments required for manufacture, as the general urban environment in India continues to suffer from low levels of sanitation and sewerage collection & treatment and poorly managed water resources.

CONTEXT FOR FIRM RIVALRY AND STRATEGY

The most important piece of legislation that has impacted the competitive behavior of biopharmaceutical firms in the cluster and across the country is India’s decision to sign onto TRIPS in 1995 and complete the transition process in 2005 with the 3rd Amendment to the Indian Patent Act of 1970 -fully recognizing product patents3. This has limited the ability of firms to produce generic versions of drugs patented elsewhere. The impact of the new patent regime can be seen in the shift of the business strategy of Indian firms. Two major trends:

1) Shift from pure manufacturing and marketing of generics to R&D through tie ups with Central Institutes and foreign firms (e.g.: Lupin Laboratories, Mumbai ties up with Central Drug Research Institute Lucknow and Indian Institute of Chemical Technology, Hyderabad).

2) Investments and agreements to capitalize on outsourcing opportunities. McKinsey projects that the market for Clinical Trials alone in India is expected to be $1.5 Billion by 2010 and growing at a rate of 30-35% per annum with Pfizer, Johnson& Johnson, GlaxoSmithKline and AstraZeneca already conducting trials in India (5% of global trials in 2012)

Given the size of the opportunity presented by a rising middle class eager to access patented drugs, Indian drug companies have accepted the new patent regime as an opportunity to shift their business model away from mass therapies to more specialized, patented drugs that can be sold at a higher price.

In this new environment, the central government is highly supportive of the biopharmaceutical industry with the Department of Biotech providing grants for R&D and overseeing a flexible regulatory environment.

DEMAND CONDITIONS

The legacy of import substitution and public sector demand for inexpensive mass vaccinations has sustained the cluster for most of the previous century. Large governmental demand for low cost vaccines has meant the cluster has developed the capability of process replication and high volume (though low value) production. The growing middle class means there is some initial demand for the higher value items that the cluster currently only produces for export. The increasing disease burden means there is significant focus on the biopharmaceutical solutions for cost effective results. Allied to a wave of drugs coming off patent and the active IGO sector, the cluster has some attractive demand dynamics.

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India’s biopharmaceutical industry has achieved impressive levels of growth; the average growth rate of biopharmaceuticals in India 2002-05 has been 34% and accounts for 76% of total revenues in the biotech sector. With sales valued at US$2.86 billion in 2007-2008, it is expected that based on current growth trends the industry will hit US$ 5.7 billion by 2012-13 (McKinsey, 2008) As domestic demand for improved healthcare, and international opportunities for biologics increase, India will continue to expand its presence on the world biopharmaceutical stage. Diagnostics, vaccines and recombinant therapeutic proteins are the three main segments in the Indian biopharmaceutical industry. Recombinant therapeutics and vaccines jointly make up almost $500 million of the domestic market. The vaccines market in India is growing at a rate of 38% and comprises 17 domestic and international players that market 50 brands of 15 different vaccines (Pharmabiz Magazine, 2009).

On the other hand, a major area of opportunity lies in the highly competitive Indian market for recombinant Insulin for treating diabetes. The present insulin market in India approximates 300 million (including high end vaccines introduced by the private sector), with the human insulin market is growing at the rate of 40.5%. The launch of Insulin by Indian companies has resulted in drastic downward revision in prices. Earlier, such therapies were restricted to a small category of patients who could afford the drug. Products showing good potential are Erythropoietin, Streptokinase and Interferon. The market for Hepatitis B vaccine alone accounts for revenues to the tune of US$ 22 million, which is a critical local requirement as 8.7% of the global incidence of Hepatitis B occurs in India (Pharmabiz Magazine, 2009).

Nevertheless, the poor public health system, unsophisticated demand and high untreated population mean the cluster has limited local demand sophistication that could drive innovation. The high reliance on governmental purchases means the industry cannot allocate investment based purely on financial considerations. Additionally the largely unorganized retail environment means that demand is difficult to understand precisely, and thereby results in inadequate marketing to audience that have strong influence on direct demand for drugs.

RELATED AND SUPPORTING INDUSTRIES To better understand Maharashtra’s strength in biopharmaceutical we first examine the value chain. The biopharmaceutical value chain is similar in structure to the pharmaceutical value chain and is composed of four main parts: research & drug discovery, preclinical studies, Phase I, II & III trials and manufacturing/distribution, as shown.

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BIOPHARMACEUTICAL VALUE CHAIN

Of these various phases, Indian companies and multinationals based in India have been focused on Manufacturing and Marketing (see shaded area above). R&D investments by Indian and multinationals have increased since India signed TRIPS. India is now considered a serious contender in the market for outsourcing Clinical Research (Phases 1, 2 &3). In 2009, the USFDA opened offices in Mumbai (Maharashtra) and Delhi to facilitate speedy approvals of patent applications from India.

MAHARASHTRA BIOPHARMACEUTICAL CLUSTER MAP

The cluster map reflects strengths in manufacturing and marketing in line with our value chain analysis. There are over 4100 registered pharmaceutical firms and 70 biotech firms in Maharashtra. Initially dependent on the availability of horse blood for plasma to produce anti-toxins like tetanus, firms were located close to animal farms in Mumbai and Pune. Later, the Indian government allowed duty free imports of biological material for export purposes and it was less important to be located near animal farms. Other key cluster inputs:

Skilled manpower:

Typically, workers in biotech need a Masters or a PhD to gain employment. The University of Mumbai, the Indian Institute of Technology and Pune University are educational institutions that have dedicated Biotechnology departments. Pune, once known as the ‘Oxford of the East’ has over 100 institutes and 9 universities lending substantially to Maharashtra’s pool of technical graduates. For the biopharmaceutical industry in particular, there are threats to the supply of talent from two sources: 1) Students who pursue a PhD in countries like the U.S. and U.K. often choose to stay abroad aided by immigration policies that favor highly skilled people and 2) Competition for graduates from companies in other Indian states. While

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figures for the second category of brain drain are not available, it is safe to say that Brain Drain from India to developed countries does impact the work of Biopharmaceutical companies by creating a scarcity of specialists.

Research centers:

There are over 10 National research organizations that make Maharashtra and Pune in particular, a hub for the exchange of scientific ideas and provide University students access to the latest Indian biotech research . Government investments in these institutes provide opportunities for collaborative research with the biotech industry though formal partnerships are very few.

The bulk of original research continues to take place outside of the cluster. For most diseases with economic potential, researchers work for companies and universities located in developed western countries and the number of collaborations has increased manifold in the last few years (e.g. Serum Institute and Syracuse University tie-up to develop oral insulin).

The presence of a large IT industry (over 1200 units in the state accounting for over 30% of India’s software exports), a strong financial services cluster,(Over 90 per cent of merchant banking transactions are structured in Mumbai, which also accounts for 14 per cent of nationl bank deposits) large healthcare delivery cluster (private and public hospital network) and an established agri-business and animal husbandry clusters ( MAHYCO5is the largest supplier of

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hybrid seeds in India and Venky’s is the largest integrated poultry farming group in Asia) further support the growth of biopharma in Maharashtra. Venkys has recently diversified from producing only animal biopharmaceuticals to human biopharmaceuticals. Equipment for biotech labs is largely designed by firms and fabricated by contract manufacturers within the state. Specialized equipment is typically imported by air or ship.

In terms of Institutions for Collaboration, Maharashtra lacks sector-specific private organizations such as those located in other Biotech states like Karnataka (Association of Biotech Led Enterprises) and Andhra Pradesh (All India Biotech Association). The Maharashtra Government however, has been extremely pro active in setting up the Maharashtra Biotech Board and Maharashtra Biotech Commission to implement the state’s Biotech Policy (2001) and utilizes the funds allocated under a special Biotech Fund to finance new ventures. The Fund (initially $10 million) was developed through contributions from all state departments such as Agriculture, Commerce and Health.

Companies within the cluster adhere to standards set by the Central Drug Standard Control Organization, Maharashtra’s own Food and Drug Authority, the US FDA (for exports to the developed world) and WHO (for exports of vaccines to developing countries).

Finally, Maharashtra’s Biopharma cluster benefits from the presence of an active International government sector in the form of UNICEF, WHO, PAHO 6 - key buyers of vaccines for developing countries. Most international organizations have state offices that coordinate with international procurement offices based in Geneva. India’s Ministry of Health is also a major buyer of vaccines for its ‘Extended Program of Immunization’, though its Vaccine Procurement Cell is located in New Delhi.

To conclude, Maharashtra’s Biopharmaceutical cluster is very strong in the Factor Conditions and Related and Supported Activities corners of the Cluster Diamond. These are also the areas where the Maharashtra government has the most leverage with the other two corners largely dependent on Central Government policies and macroeconomic conditions.

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CONCLUSION

From the above analysis of various industrial sectors in Maharashtra which have potential of exports to other countries we can conclude that:

In Agricultural sector there are various fruits rather than vegetables which can be exported. Particularly there is huge scope for exporting fruits like Pomegranate which has been taken as case in the analysis. Also there is scope for various other fruits like Banana, Mangoes, Strawberries etc.

When we consider the Tourism sector there is particularly scope in various tourist spots like Mahabaleshwar, Mumbai, beaches like alibag, religious spots like Shirdi, Historical spots like Ajanta caves etc.

Coming to Mining sector there is huge scope of exporting minerals from Bhandara district which is Eastern part of Maharashtra or Central India.

In case of Engineering goods sector there is scope for exporting various spare parts. Particularly most of the exports pass through Mumbai port.

Pharmaceutical sector has been dealt which focuses on various Pharma Industries in Maharashtra along with scope of exporting various biopharmaceutical products.

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Documents

MAHARASHTRA State Report