Economy of Gujarat

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Introduction

Located on the west coast of India, Gujarat has the longest sea coastline of 1,600 kms in the country with vast spread white desert named as Rann of Kutch. State of Gujarat has grown at a rapid pace in past two decades. The state government was successful to attract investors from India and foreign countries which game major boost to their economy. At current point, Gujarat stands in the list of most favourite destination for industrial plants in India after the Northern states like Haryana, Himachal Pradesh, Rajasthan, Uttar Pradesh and Punjab. In recent time Gujarat state government launched a scheme to boost electric vehicle purchase in the state.

Gujarat is a leader in industrial sectors such as chemicals, petrochemicals, dairy, drugs and pharmaceuticals, cement and ceramics, gems and jewellery, textiles and engineering. The industrial sector comprises of over 800 large industries and 453,339 micro, small and medium enterprises.

Economic Data

Gujarat’s industrial economy has 13 major industrial groups, accounting for approximately 82.05% of total factories, 95.85% of total fixed capital investment, 90.09% of production and 93.21% of value added. The state’s total exports were $ 63,440 million in 2019-20 and $ 60,587 million in 2020-21.

With more than 3,300 pharmaceutical manufacturing units in Gujarat, it contributed 30-35% to India’s pharmaceutical sector sales in 2018-19 and about 28% to India’s pharmaceutical exports. Gujarat’s pharmaceutical exports reached US $ 305.33 million in 2019-20 and US $ 2.789.92 million in fiscal year 21.

In 2019-20, the state produced 4.6 million tonnes of crude oil and 1,287 million cubic meters of natural gas. Total consumption of petroleum products in 2019-20 was 22.53 million metric tons (MMT). Gujarat’s petroleum product exports reached $ 211.092 million in fiscal year 21.

The state is the world’s largest producer of processed diamonds, accounting for 72% of the world’s processed diamond share and 80% of India’s diamond exports. With a contribution of 65 to 70% to India’s denim production, Gujarat is the largest manufacturer of denim in the country and the third largest in the world. There are 42 ports, 18 domestic airports and one international airport. There are 106 product clusters and 60 notified special economic zones (SEZs). Large scale investment is expected in Gujarat as part of the US$ 90 billion Delhi-Mumbai Industrial Corridor (DMIC).

State Policies

State government of Gujarat kept updating the norms and regulatory policies to keep the cash inflow circulating throughout the trade. The state has undertaken various measures to enhance the “Ease of Doing Business” experience for existing and prospective enterprises.

Objectives:

• To create an enabling business environment facilitated by a single window system

• To enable industries to set high quality standards and enhance exports

• To have a focused approach for industrially underdeveloped areas & facilitate inclusive & balanced regional growth

• To promote industries focusing to adopt sustainable, cleaner manufacturing and innovative Industry 4.0 practices

• To strengthen MSMEs and facilitate cluster development

• To strengthen complete value chain across product segment with focus on the objective of an “Atmanirbhar Bharat”

• To encourage R&D, innovation and entrepreneurship

• To provide increased impetus to certain Thrust Sectors with significant potential for employment, exports, investments etc.

• To facilitate growth of Service sector industries in the state

• To facilitate state of the art, sustainable Industrial Infrastructure

• To increase productive employment opportunities in the state

The R&D culture

Gujarat government took their vision and mission seriously and are supporting the startup culture with focusing on setting up Research & Development Institutions/Laboratories for further growth. In order to support the Research and Development in the state, the policy will provide assistance to R&D institutions / laboratories set up with State Government or Government of India including setting up of new R&D institutions/laboratories. For Private Institutions/ Companies who wish to set up Research & Product Development center in the state, the policy will provide assistance up to 30% of the project cost of machinery and equipment maximum up to INR 5 crore.

Policy will also provide assistance in setting up of laboratories established by Industries Association with the help of Government up to 60% of the project cost of machinery and equipment cost

Note: The above data has been extracted from multiple sources. For reference you can visit the provided link.

https://www.ibef.org/states/gujarat.aspx

https://gujaratindia.gov.in/business/policies.html

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