meghalaya

MEGHALAYAApril 2010

2

Investment climate of a state

Resources/Inputs

Incentives to industry Physical and social infrastructure

Regulatory framework

• Skilled and cost-effective labour• Labour market flexibility• Labour relations• Availability of raw materials and natural

resources

• Tax incentives and exemptions• Investment subsidies and other incentives• Availability of finance at cost-effective terms• Incentives for foreign direct investment (FDI)• Profitability of the industry

• Procedures for entry and exit of firms• Industrial regulation, labour regulation, other

government regulations• Certainty about rules and regulations• Security, law and order situation

• Condition of physical infrastructure such as power, water, roads, etc.

• Information infrastructure such as telecom, IT, etc.

• Social infrastructure such as educational and medical facilities

Investment climate of a state is determined by a mix of factors

MEGHALAYA April 2010

3

Advantage Meghalaya

State economy and socio-economic profile

Infrastructure status

State policies and incentives

Business opportunities

Doing business in Meghalaya


Contents

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Meghalaya – State profile

• Covering an area of 22,429 sq km, Meghalaya shares its border with Assam in the North and Bangladesh in the South.

• The state has seven administrative districts. Shillongis Meghalaya’s capital city; Sohra, Tura Jowai, Nongstoin, Wiliamnagar, Nongpoh and Baghmara are the other key cities.

• Meghalaya is the wettest state in the country with an average rainfall of 1,200 cm. It has numerous rivers, the major ones being, Manda, Damring, Janjiram, Ringge, Ganol, Simsang, Khri, Umtrew, Umiam, Umkhem, Kupli, Kynshi, Umiam Mawphlang and Umngot.

• Meghalaya has diverse soil types including red-loamy, laterite, and red and yellow soils. They have fine textures ranging from loam to silty-loam and alluvial soils. These types of soils support a variety of agricultural crops.

• English is the official language of Meghalaya. Khasi, Pnar and Garo are the other principal languages.

ADVANTAGE MEGHALAYAMeghalaya April 2010

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Policy and fiscal incentivesThe state offers a host of industrial incentives, apart from CentralGovernment incentives meant for investments in the Northeast region.Agro-processing, horticulture, minerals, tourism, electronics and IT havebeen identified as thrust sectors for development and promotion.

Rich natural resourcesMeghalaya is endowed with abundant natural resources in terms offlora, fauna, medicinalplants, forests, coal, limestone, feldspar, quartz, sillimanite, granite, industrial clay and uranium. They offer significant avenues for investment.

Advantage Meghalaya … (1/2)

Institutional supportThe state provides excellent institutional support through various centraland state government agencies viz., North East Council, Ministry ofDevelopment of North Eastern Region and Meghalaya IndustrialDevelopment Corporation.

ADVANTAGE MEGHALAYA Meghalaya April 2010

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Conducive agro-climatic conditions The state has favourable agro-climatic conditions that supportsagriculture, horticulture and forestry; there is potential fordevelopment in related areas.

Availability of skilled labour Meghalaya has a literacy rate of 62.6 per cent. The state has astrong higher-education infrastructure. Moreover, a majority ofthe local population speaks and understands English.

Tourism destination of the NortheastThe Meghalayan community has a rich culture and is an attractivetourist destination.


Advantage Meghalaya … (2/2)

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Meghalaya in figures

Parameter Meghalaya All-states Source

Economy

GSDP as a percentage of all states’ GSDP 0.2 100.0 CMIE, 2005-06, current prices

Average GSDP growth rate (%) 10.9 7.5 CMIE, 1999-2000 to 2007-08

Per capita GSDP (US$) 751.3 998.1 CMIE, 2007-08

Physical infrastructure

Installed power capacity (MW) 189.1 98,996.4 Central Electricity Authority, as of March 2009

GSM cellular subscribers (No) 4,259,022* 367,328,179 Cellular Operators Association of India, as of November 2009

Broadband subscribers (No) 14,202* 4,981,976 As of October 2008

National highway length (km) 810 70,548 Ministry of Road Transport & Highways, 2007-08

Airports (No) 2 133 Industry sources

Social indicators

Literacy rate (%) 62.6 64.8 Census of India, 2001

Birth rate (per 1,000 population) 24.4 23.1 Central Bureau of Health Intelligence, 2007

* Figures for the Northeastern region comprising Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura


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Key industries with policy thrust and factor advantages

Medium HighLow

Medium

High

Industry attractiveness matrix

Sericulture Handloom

Food processing

Tourism

IT

*Factor advantages include benefits due to geographical location and availability of factors such as talent pool, natural resources and capital

Bamboo

Agriculture and horticulture

Hydro

Minerals


Pol

icy

thru

st

Factor advantage

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Advantage Meghalaya







Contents

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Socio-economic snapshot of Meghalaya

Parameters Meghalaya

Capital Shillong

Geographical area (sq km) 22,429

Administrative districts (No) 7

Population density (persons per sq km) 131

Total population (million) 2.3

Male population (million) 1.2

Female population (million) 1.1

Population growth rate 1991-2001 (%) 30.65

Sex ratio (females per 1,000 males) 980

Literacy rate (%) 62.6

Male (%) 65.4

Female (%) 59.6

Source: Statistical Handbook, 2008-09

STATE ECONOMY AND SOCIO-ECONOMIC PROFILEMeghalaya April 2010

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Meghalaya’s GSDPMeghalaya’s GSDP

(US$ billion)

Source: CMIE

• At current prices, the Gross State Domestic Product (GSDP) of Meghalaya was about US$ 1.89 billion in 2007-08.

• The state’s GSDP grew at a CAGR of 10.9 per cent between 1999-2000 and 2007-08.

• Agriculture, tourism, mining, trade, construction and manufacturing industries contributed to the GSDP growth.

0.83

0.87

0.94

0.99

1.15

1.29

1.43

1.54

1.89

0.00 0.50 1.00 1.50 2.00

1999-00

2000-01

2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

CAGR10.9%

STATE ECONOMY AND SOCIO-ECONOMIC PROFILE Meghalaya April 2010

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Meghalaya’s NSDP (US$ billion)

• At current prices, the net state domestic product (NSDP) of Meghalaya was about US$ 1.67 billion in 2007-08.

• Meghalaya’s NSDP grew at a CAGR of 10.6 per cent between 1999-2000 and 2007-08.

0.74

0.79

0.85

0.89

1.03

1.15

1.27

1.36

1.67

0.00 0.50 1.00 1.50 2.00

1999-00

2000-01

2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

CAGR10.6%


Meghalaya’s NSDP

Source: CMIE

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Meghalaya’s economic performance is driven by the secondary and tertiary sectors

Source: CMIE

• At a CAGR of 21.6 per cent, the secondary sector has been the fastest growing among the three sectors from 1999-2000 to 2007-08. The growth has been driven by manufacturing, construction and electricity.

• The tertiary sector, the largest contributor to Meghalaya’s economy, grew at a CAGR of 11.1 per cent between 1999-2000 and 2007-08; it was driven by trade, tourism, real estate, transport and communications.

• The primary sector’s share in the GSDP has been declining; it registered a CAGR of 8.7 per cent between 1999-2000 and 2007-08.

Percentage distribution of sectors


31.8 36.4

4.4 2.1

63.8 61.5

0

20

40

60

80

100

1999-00 2007-08

Primary Sector Secondary Sector

Tertiary Sector

8.7%

21.6%

11.1%

CAGR

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Per capita GSDP

• Meghalaya’s per capita GSDP in 2007-08 was US$ 751.3.

• The per capita GSDP has increased at a CAGR of 9.3 per cent between 1999-2000 and 2007-08.

• The districts of East-Khasi Hills, West-GaroHills and Jainita Hills contribute to more than 70 per cent of the state’s GSDP.

• Trade, manufacturing, tourism, construction, transportation and agriculture have been the key contributors to per capita GSDP.

Source: CMIE

Per capita GSDP

(US$

)

369.1 377.2 399.0 416.1479.7

533.2579.8

619.4

751.3

0.0

100.0

200.0

300.0

400.0

500.0

600.0

700.0

800.0


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Key industries in Meghalaya

• The natural resources, policy incentives and infrastructure in the state favour investments in the tourism, hydroelectric power, manufacturing and mining sectors.

• Agriculture and related industry, contributes 21 per cent to the state’s GSDP and employs more than 70 per cent of the population.

• Mineral, horticulture, electronics, IT, export oriented units and tourism have been identified as the thrust sectors for industrial development.

• As of March 2008, there were 116 large and medium industrial undertakings and 2,653 small scale manufacturing units in Meghalaya.

• The Industries Department of Meghalaya and its constituent unit, Meghalaya Industrial Development Corporation (MIDC), are jointly responsible for the development of industrial infrastructure in the state.

Key industries in Meghalaya

Agriculture and food processing

Horticulture

Mining

Cement

Tourism

Hydroelectric power

Dairy and livestock

Handloom and handicrafts

Steel processing


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Rice, potato, pineapple and banana are the key agricultural products of Meghalaya

Crop Annual production (‘ooo tonnes)

Rice 203,485

Potato 167,030

Pineapple 93,625

Banana 71,695

Ginger 53,609

Citrus fruits 36,893

Jute* 35,499

Maize 24,424

Tapioca 20,841

Sweet potato 16,270

Turmeric 10,508

• In 2007-08, the state recorded an annual growth of 1.4 per cent in agricultural income.

• Citrus fruits, pineapple, banana, papaya, plum, peach and apricot are the major fruits grown in Meghalaya.

• Turmeric, ginger, black pepper, bay leaves are the major spices cultivated in Meghalaya; the state is also experimenting with tea cultivation in select areas.

• Around 9.8 per cent of the state is under cultivation; and additional 20.1per cent land is available for cultivation offering immense potential for agricultural production.

• Meghalaya produced 97.8 million eggs and 74.4 million tonnes of milk in 2006-07.

Source: Meghalaya Statistical Handbook, 2008-09


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Meghalaya’s exports trends• In 2005-06, Meghalaya’s exported goods and

services worth US$ 47.7 million, accounting for about 48 per cent of the total exports from the Northeast region.

• An export promotion industrial park (EPIP) has been set up in Byrnihat over an area of 250 acres to promote exports.

• Meghalaya shares a 443-km border with Bangladesh and has eight land-custom stations to aid exports.

• The key commodities exported to Bangladesh are coal, limestone, boulder stone, agricultural produce, and raw hides and skins.

Meghalaya’s exports

Source: State Development Report, 2008-09, as of 2005-06

Export commodity Value(US$ million)

Coal 37.50

Limestone 2.70

Ginger 0.09

Crushed stone 0.07

Orange 0.05

Boulder stone 0.05


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Sector-wise investments

• Over US$ 2.3 billion of investments have been made in ramping up Meghalaya’s infrastructure, as of December 2008.

• Over 60 percent of the investments have been made in the area of power, especially, hydroelectric power generation and distribution.

• Tourism, cement industry, mining, air transport and railways are also expected to receive significant investments over the coming years.

Source: CMIE, as of 2008

538.8

250.2

1452.5

125.0

Manufacturing Mining Electricity Services

Break up of investments by sector


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Advantage Meghalaya







Contents

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Roads, railways and airports

• Meghalaya had a total road length of 8,371 km, with a road density of 36.4 km per100 sq km, as of 2007-08.

• The state is well connected to its neighbouring Northeastern states and other parts of India through four National Highways: NH-40, NH-44, NH-51 and NH-62.

• The nearest railway station is in Guwahati, Assam. Land acquisition is in progress for the construction of two railway stations at Mendipathar and Byrnihat.

• Meghalaya has two airports located in Umroi and Balajek. The Umroi airport is fully operational, while the Balajek airport is under construction.

• Helicopter services are available from Guwahati to Tura and Shillong.

• The Meghalaya Transport Corporation provides bus transport services across the state.

Road type Road length (Km)

National Highways* 810

State Highways 1,137

Major district roads 1,219

Other district roads 5,205

Sources: Statistical Handbook, 2007-08, Ministry of Road Transport & Highways*As of 2007-08

Source: Maps of India

INFRASTRUCTURE STATUS Meghalaya April 2010

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Power• As of March 2009, Meghalaya had a total

installed power capacity of 189.1 MW, all under the Meghalaya Power Generation Corporation.

• Hydroelectric power constitutes 187 MW, the balance being generated from diesel.

• Meghalaya has a assessed hydroelectric potential of 3,000 MW of which only 187 MW has been tapped.

• The per capita power consumption of Meghalaya was 387.4 kWh as of 2007-08.

• As of 2008, 73 per cent of the villages had been electrified in the state, and plans are underway to electrify the whole state by 2012.

188.8 188.8

187.6 187.6

189.1 189.1 189.1 189.1

186.5

187.0

187.5

188.0

188.5

189.0

189.5

2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09

Installed state and private capacity (MW)

Source: Central Electricity Authority

• In April 2010, the State Government restructured the Meghalaya State Electricity Board (MeSEB) to create a holding company called Meghalaya Energy Corporation Limited (MECL) and its three subsidiaries: Meghalaya Power Generation Corporation (MePGCL), Meghalaya Power Transmission Corporation Limited (MePTCL) and Meghalaya Power Distribution Corporation (MePDCL).


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Telecom infrastructure

• In 2007-08, Meghalaya had 118 telephone exchanges with 67,766 landline connections, 10,592* WLL connections and 89,665** mobile phone connections.

• As of 2007, there were 7,360 internet connections in the state including 1,621 working broadband connections.

• Virtual private network (VPN) over broadband line is also available in the state to enable business communications.

• Meghalaya had 390 post offices as of 2007, providing postal services across the state.

Source: State Development Report, 2008-09

Telecom operators in Meghalaya

• Bharat Sanchal Nigam Limited (BSNL)

• Bharti Airtel

• Aircel Limited

• Vodafone Essar

• IDEA Cellular

• Reliance Communications

• Tata Indicom

*As of 2006-07

**Mobile connections pertain to BSNL only


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Urban infrastructure … (1/2)

Water supply

• The average per capita supply of water in major cities and towns is 150-200 litres per day.

• Meghalaya has 16 urban agglomerations and about 71 per cent of the population in these is provided with piped-water supply.

Sewerage

• Solid-waste segregation and disposal is diligently adhered to across the state.

• A 100 tonnes per day (TPD) compost plant in Shillong and 40 TPD plant in Tura are operational in the public private partnership (PPP) mode for safe disposal of solid wastes.

• Sites have been identified in Williamnagar, Baghmara and Resubelpara and work has commenced on developing compost plants.


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• Under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM), two projects worth US$ 47.4 million were approved in 2008-09 for developing urban infrastructure in Shillong; the aim is to provide better drainage and drinking water supply.

• Under the Environmental Improvement of Urban Slums (EIUS) programme, 45 notified and five slum areas in Shillong, Tura, Jowai, Baghmara, Williamnagar and Nongstoin have been provided with basic amenities.

• The New Shillong township is being developed, based on the Shillong Master Plan, 1991-2011; the new township would cover an area of 2,030 hectares, of which 500 acres is to be acquired and developed by the government.


Urban infrastructure … (2/2)

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Education infrastructure

• According to the Census 2001, Meghalaya had a literacy rate of 62.6 per cent as of March 2001; male literacy rate was 65.4 per cent and female literacy rate was 59.6 per cent.

• The North East Hill University (NEHU) provides Bachelors, Masters and Doctoral degrees in the science, technology and humanities streams.

• The North East Indira Gandhi Regional Institute of Health and Medical Sciences (NEIGRIHMS) conducts bachelor of medicine and post graduate courses in medicine; a bachelors of nursing college also operates under its aegis.

• The National Institute of Fashion Technology (NIFT) conducts courses on fashion technology.

• The Indian Institute of Public Health, Indian Institute of Information Technology, industrial training institutes (ITI), polytechnics are under various stages of implementation in the PPP mode.

Source: Statistical Handbook 2008-09, as of 2006

Educational infrastructure (No)

Universities 1

Colleges 56

Polytechnics and ITI training institutes 8

Teacher training institutes 3

High and higher secondary schools 774

Middle and senior basic schools 2,259

Primary and junior basic schools 6,351

Pupil-teacher ratio of schools in Meghalaya

Primary schools 34:1

Secondary schools 24:1

High and higher secondary schools 25:1

Source: State Development Report 2008-09, as of 2005-06


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Health infrastructure

• There are 10 private hospitals in the state with a total bed strength of 1,650 beds.

• The state’s four military and paramilitary hospitals provide preventive and promotional healthcare services.

• NEIGRIHMS, which has been instituted to provide medical education, has a 500 bed super-specialty hospital; expansion works are underway.

Source: Statistical Handbook of Meghalaya, 2008-09

Health indicators

Beds per 100,000 population# 137

Birth rate* 24.4

Death rate* 7.5

Infant mortality rate** 56

Health infrastructure

• Primary health centres: 104• Sub-centres: 404• Community health centres: 28• Hospitals: 9• Dispensaries: 12• Leprosy colonies: 2• Leprosy control units: 2• Doctors: 671• Nurses: 893

Sources: Statistical Handbook of Meghalaya, 2008-09# State Development Report, 2008-09*Per thousand persons, as of 2006-07**Per thousand live births, as of 2006-07


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Cultural infrastructure

• Shad Suk Mynsiem, Nongkrem dance, Wangala, Behdeinkhlam, Laho dance, Chad Sukra, Autumn festival, Strawberry festival, Ranikor festival are the well-known festivals of Meghalaya.

• Meghalaya has varied tourist attractions such as caves, national parks and sanctuaries, sacred groves, waterfalls, lakes and rivers – making it an ideal tourism destination.

• Meghalaya sports a 18-hole natural golf course, which is a major sport and corporate attraction.

• Bara bazar, Jail road, G.S. road, Police bazar, Glory’s plaza, Meghaloom, Nagaland Handloom and Handicrafts, Assam Emporium, India Emporium, Khadi Gramodyog, Manipur Emporium, Tantuja, and Purbashree are the key shopping areas in Meghalaya.

• Capt. Williamson Sangma State Museum, Don Bosco Centre for Indigenous Cultures, Entomological Museum (Butterfly Museum) are the famous museums of Meghalaya depicting its rich cultural heritage.

• Lady Hydari park, Mattilang park, Sa-I-Mika park, Thangkharang park, Eco park in East Khasi hills; Nehru park, Kharsati park, Thrills Fun park in Ri Bhoi; Nokrek National park in West Garo hills; BalpakramNational park in South Garo hills, Ialong park, Iooksi (Kupli) park in Jaintia hills are the popular national parks and recreation centres in Meghalaya.


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Industrial infrastructure

• Meghalaya has industrial estates at Shillong, Nongstoin, Mawlyndep, Tura, Williamnagar and Khliehtyrshi; an industrial area at Umiam; an export promotion industrial park (EPIP) at Byrnihat; and a growth centre at Mendipathar.

• District Industrial Centres (DIC) are functional under the MIDC in each district and are involved in industrial infrastructure development of the district.

• The state has constituted a single-window clearance agency for industrial investment approvals.

• Techno-economic feasibility reports (TEFR) are available with the MIDC for poultry, agro-based industry, fruit processing, paper-grade lime, alcohol from tapioca, calcium carbonate extraction, ceramic-glazed tile manufacturing, marble and tile, and meat processing.

• Under the central government’s Assistance to states for Developing Infrastructure for Exports (ASIDE) programme, 29 infrastructure development projects have been approved, worth US$ 21.4 million.


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Advantage Meghalaya







Contents

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Sector-specific policies … (1/7)

North East Industrial and Investment Promotion Policy (NEIIPP), 2007

Aim: To promote the Northeast region as an attractive investment destination through various concessions and incentives.

Key features:

• Industries under this policy are eligible for incentives for a period of 10 years from the date of commencement of commercial production.

• All units, new as well as the existing ones that undergo substantial expansion (minimum 25 per cent increase in fixed capital) and start production before 2017, would qualify for the incentives.

• Incentives would be available for all existing industrial units and upcoming units anywhere in the Northeast.

• A high-level monitoring committee or advisory committee would oversee implementation of the NEIIPP.

• NEIIPP would not be applicable for peripheral activities such as preservation while storage, cleaning, packing, re-packing, labelling or re-labelling, sorting, etc.

• North East Industrial Development Finance Corporation (NeDFI) will act as the nodal agency for disbursal of subsidies.

• NEIIPP 2007 has replaced the North East Industrial Policy1997.

Continued..

STATE POLICIES AND INCENTIVES Meghalaya April 2010

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NEIIPP, 2007

Incentives and concessions:

• 100 per cent excise duty exemption on finished products made in the Northeast Region.

• 100 per cent income tax exemption for industrial units.

• Capital investment subsidy increased from 15 per cent to 30 per cent for plant and machinery up to US$ 360,000 per unit. For units above US$ 360,000 of capital investment and up to US$ 7.5 million, an empowered committee approves. For units above US$7.5 million the Union Cabinet approves.

• Interest subsidy to be given at the rate of 3 per cent on working capital.

• 100 per cent reimbursement of insurance premium.



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Industrial Policy, 1997

Aim: To facilitate rapid and sustained industrial development of the state.

Key initiatives:

• Meghalaya to develop general infrastructure such as road, power, water and communication.

• The state government to invite private sector in undertaking joint projects.

• MIDC to act as a channelling agency for obtaining credit for industrial development.

• DICs to serve as principal contact and guiding agency for entrepreneurs and investors.

• State government to set up single-window clearance for large and medium industries.

• Agriculture, horticulture, bio-technology, animal husbandry and meat processing, minerals, electronics and IT have been identified as thrust sectors.



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Industrial Policy, 1997


• State capital investment subsidy provided at 30 per cent of the fixed capital, with a ceiling of US$ 43,000.

• Interest subsidy for bank loans at the rate of 4 per cent, with a ceiling of US$ 435 per month for a period of three years.

• Subsidy on power tariffs at the rates of 30 per cent and 25 per cent for loads up to 2 MW and above 2 MW, respectively.

• Cost of drawl of power-line above 33 kV is reimbursed if a separate line is required for the industry.

• Exemption from sales tax for a period of seven years from the date of commercial production.

• Refund of central sales tax paid on machinery and equipment up to the commissioning of the industry.

• Subsidy on cost incurred on quality control measures and pollution control measures.

• Exemption from stamp duty.

• Additional sales tax incentives, limited to the amount of capital subsidy.

• Additional 5 per cent capital investment subsidy for export oriented units.



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The Meghalaya State Tourism Policy, 2007 (Draft)

Aim: To promote tourism as an economic driver of the state

Key thrust areas:

• Nature tourism, adventure and sports tourism, cultural tourism, health tourism, golf tourism, convention tourism and arts and crafts tourism.

• Public private partnership (PPP) mode to be given preference for infrastructure development and service delivery.

• Training centres to be set up by the Government to provide training in hospitality and tourism industry.

• Single-window clearance to be set up in cognizance with the NEIPP 2007.



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The Meghalaya State Tourism Policy, 2007 (Draft)

Aim: To promote tourism as an economic driver of the state

Key incentives and initiatives:

• Reimbursement of up to 30 per cent of realistic wage of local tribal employees, annually.

• Subsidy at the rate of 50 per cent for purchase and installation of power generation set, above 2 MW.

• 100 per cent refund of central sales tax (CST) on equipment and machinery installed as on the date of commissioning of the unit.

• Stamp duty exemption up to 75 per cent on investments above US$ 434,782.

• Reimbursement of 25 per cent of the entertainment tax for theme parks and urban entertainment centres for a period of five years

• Exemption from luxury tax for a period of five years.

• Reimbursement of 25 per cent of the value added tax (VAT) for five years from the commencement of operation.



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IT Policy, 2004

Aim: To create wealth, generate employment and bring in IT-led economic growth.

Key initiatives:

• Facilitate creation of IT infrastructure, software technology park and last mile connectivity to villages.

• Facilitate the establishment of IT enabled service centres in the state.

• To develop the human resource base required for the IT industry.

• Apply IT in governance and management of the state government programmes.

• Earmark up to 5 per cent of the government’s budget for IT-related expenditure.


• Over and above the state incentives for industrial units, 10 per cent subsidy to be provided for IT industries in respect of power captive generation set, capital subsidy and capital rent subsidy.



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Advantage Meghalaya







Contents

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Floriculture

• Meghalaya has a plant vascular diversity of 3,331; more than 300 varieties of orchids are found in the state.

• Decorative plants such as dahlia, canna, gladiolus, begonia, tropaeolum, aster, polargonium, antirrhinum, crinum, celosia, kniphofia, impatiens, chrysanthemum, petunias, pansy, calendula, sweet peas and salvia are found in abundance in the state.

• The existing industry is at a nascent stage and has the potential to be developed and promoted for export oriented business.

Medicinal plants and bamboo • Meghalaya houses 834 of the 6,000 medicinal plants available in India.

• This sector has been identified as one of the priority sectors for investment by the state.

• Around 120 species have been identified for commercial production.

• Meghalaya is one of the leading producers of bamboo in the country; bamboo enterprises could be developed from the bamboo reserves and forest cultivations.

BUSINESS OPPORTUNITIES Meghalaya April 2010

39

Agriculture, horticulture and food processing• Meghalaya has a climate that supports agricultural and horticultural activities; the state offers potential for

investment in these areas.

• It supports multiple crops viz., rice, maize, pulses, oil seeds, cotton, jute, and mesta; Meghalaya produces substantial quantities of oranges, peaches, pineapples, pears, guavas, plums, bananas, potatoes, tapioca, bay leaves, ginger, maize and jackfruit.

• Meghalaya’s turmeric is considered one of the best in the world as it contains 7.5 per cent of curcumine.

Hydroelectric power

• It is estimated that Meghalaya has a hydroelectric power capacity of 3,000 MW, of which only 187 MW has been developed so far.

• The state government is inviting investments in this area through the PPP mode. Independent power producers (IPP) are also being invited to develop hydro projects in Meghalaya; this provides immense potential for investment.


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Tourism sector• Meghalaya is richly endowed with flora, fauna, thick

forests, ancient forest groves, large rivers and grass fields – making it an attractive tourism destination.

• The number of foreign tourists has increased by 24 per cent between 2006 and 2007. During the same period, the domestic tourist population increased by 14 percent from 400,287 in 2006 to 457,685 in 2007.

• PPP is being invited by the Meghalaya government to create tourist complexes, eco-tourism, adventure tourism, ethnic culture tourism, health farms, hotels, convention centres, tourist travel services, etc.

IT sector• The IT policy of Meghalaya defines the IT penetration plan for various industries and public sector

organisations.

• With a high literacy rate, affordable cost, substantial English-speaking population, improved telecommunication connectivity and favourable climate, Meghalaya is well poised to serve the IT industry.

• The policy also provides various incentives and concessions for investments in IT sector.

Source: Maps of India


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Sericulture industry

• Mulberry, muga and eri cocoons are cultivated in Meghalaya.

• The state produced 295.3 million tonnes of eri, 269.1 million tonnes of muga and 19.9 million tonnes of mulberry cocoon in 2005-06.

• Sericulture has predominantly remained a cottage industry and the government is taking proactive steps in training the people, reaching out to the market and providing technical support.

Handloom and handicrafts

• Meghalaya has an established tradition of high-quality weaving, with more than 25,000 households engaged in handloom weaving.

• There are eight production centres, 32 demonstration-cum-production centres, 10 weaving training centres and a state-level handloom training institute (Mendipathar, East Garo Hills) in the state.

• With support from National Institute of Design and National Institute of Fashion Technology, the handloom industry is being developed by the Meghalaya Government.


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Minerals and mining

• Meghalaya has a rich mineral resource of 640 million tonnes of coal, 5,000 million tonnes of limestone, six million tonnes of fire clay, 90 million tonnes of lithographic clay, 4.5 million tonnes of china clay, 5 million tonnes of phosphate rocks, 0.045 million tonnes of sillimanite, 25 million cubic metres of granite, and substantial reserves of quartz, feldspar, gypsum and uranium.

• The mining industry has just opened up in Meghalaya; most of the coal and stones are being exported to Bangladesh.

• A number of cement factories are being either planned or being set up, owing to the rich mineral content of the state.

Leather and allied industries

• Meghalaya had 39 leather-based industries in 2007-08; the state exported 57 million tonnes of raw hides in 2006-07 to Bangladesh.

• Though Meghalayans use a lot of leather in their clothes and in domestic applications, tanning and processing industry is not well developed, providing significant opportunity for the development of the industry.


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Major industrial projects being implemented

Promoter Project Investment(US$ million) Location

Infrastructure

Uranium Corporation of India Limited Uranium mining and processing 248.8 West Khasi Hills

Meghalaya Energy Corporation Limited Myntdu Leshka hydro-power project 154.7 Jainitia Hills

Meghalaya Energy Corporation Limited Umtru hydel power project 54.1 Ri-Bhoi

National Highways Authority of India Jorbat Shillong road up-gradation 133.3 Shillong

North Eastern Railway Azra-Byrnihat railway 118.8 Byrnihat

Manufacturing

Jai Balaji Shakti Cement Limited Cement project 155.0 Jainitia Hills

Nilanchaal Cement Private Limited Portland cement 113.0 Jainitia Hills

Goldstone Cements Limited Slag cement 97.8 Jainitia Hills

Jai Umadutt Cement Limited Cement project 47.8 East Khasi Hills

Kaziranga Cement Private Limited Cement project 39.6 East Khasi Hills

Source: projectstoday.com


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Advantage Meghalaya







Contents

45

Key approvals required

Approvals and clearances required Department

Incorporation of company Registrar of companies

Registration, Industrial Entrepreneurs Memorandum, industrial licenses

Industries Department of Meghalaya Permission for land use

Allotment of land

Site environmental approvalMeghalaya Pollution Control Board No objection certificate and consent under Water and Pollution

Control ActRegistration under States Sales Tax Act and Central and State Excise Act Excise Department Commercial taxes

Sanction of power

Meghalaya Energy Corporation LimitedPower feasibility

Power connection

Approval for construction activity and building plan Public Works Department

Water and sewerage clearancePublic Health and Engineering Department

Water connection

DOING BUSINESS IN MEGHALAYA Meghalaya April 2010

46

Cost of doing business in Meghalaya

Cost parameter Cost estimate Source

Cost of land (per acre) US$ 50,000 to US$ 75,000 (Shillong) Property dealers

Hotel costs (per room per night) US$10 to US$ 35 State tourism website

Cost of office space (2,000 sq ft) US$ 75 to US$ 200 per month Property dealers

Cost of residential space (2,000 sq ft house) US$ 60 to US$ 100 per month Property dealers

Power cost (per kWh) Commercial and industrial: US 5.8 cents Meghalaya Power Distribution Corporation Limited

Labour cost (minimum daily wages) Unskilled: US$ 2.2 Skilled: US$ 3.0

Labour Department, Government of Meghalaya


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Contact list

Key agency Contact information

Ministry of Development of North Eastern Region 258, 1st Floor, Vigyan Bhavan-AnnexeNew Delhi - 110011Phone: 91-11-2302 2401, 2302 2400Fax: 91-11-2306 2754Website: mdoner.gov.in

Industries Department of Meghalaya Director of Industries,Administrative Building, Lower LachumiereShillong - 793 001East Khasi Hills District, MeghalayaE-mail: [email protected]

Meghalaya State Electricity Board Meghalaya Energy Corporation LimitedLum Jingshai, Short Round RoadShillong – 793001MeghalayaPhone: 91-364 2590610/ 2590742/ 2590710/ 2591843Fax: 91-364-2590355


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Exchange rates

Year INR equivalent of one US$ 2000 46.62001 48.32002 48.02003 45.62004 43.72005 45.22006 45.02007 42.02008 40.22009 46.0

Annexure

Average rates for the year

Meghalaya April 2010DOING BUSINESS IN MEGHALAYA

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