Andhra Pradesh Tourism

ANDHRA PRADESH
November 2010
ANDHRA PRADESH
November 2010
Investment climate of a state is determined by a mix of factors
Skilled and cost-effective labour Labour market flexibility Labour relations Availability of raw materials and natural resources
Procedures for entry and exit of firms Industrial regulation, labour regulation, other government regulations Certainty about rules and regulations Security, law and order situation
Resources/Inputs
Incentives to industry

Investment climate of a state

Regulatory framework Physical and social infrastructure
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
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
ANDHRA PRADESH
November 2010
Contents
Advantage Andhra Pradesh State economy and socio-economic profile Infrastructure status State policies and incentives Business opportunities Doing business in Andhra Pradesh
ADVANTAGE ANDHRA PRADESH Andhra Pradesh November 2010
Andhra Pradesh State Profile
Covering an area of 275,100 sq km, Andhra Pradesh is the fourth-largest state in India after Rajasthan, Madhya Pradesh and Maharashtra. It falls in the Southern peninsula of India and has a coast line of 974 km. The state has 23 administrative districts. Hyderabad is the capital city.Visakhapatnam, Vijayawada, Tirupati, Warangal, Guntur, Kakinada, Nellore and Kurnool are the other key cities in the state. Andhra Pradesh has three major rivers, viz., the Godavari, the Krishna and the Thungabhadra. There are seven agro-climatic conditions and a variety of soils to support the cultivation of wide range of crops. The most commonly spoken language of the state is Telugu. Hindi, English and Tamil are the other languages used.
Source: Maps of India
Advantage Andhra Pradesh (1/2)

Hub for knowledge-based industries
Andhra Pradesh has emerged as a key state or the knowledgebased industry including IT, pharmaceuticals and biotechnology. It is also a leading agricultural state in the country. Over 70 of the 500 top global corporations are present in the state.
Policy and fiscal incentives

The state offers a wide range of fiscal and policy incentives for businesses under the Industrial Investment Promotion Policy, 2010-2015. Additionally, the state has well drafted sectorspecific policies.
Rich labour pool

The state has a large base of skilled labour, making it an ideal destination for the knowledge sectors. Further, the state has a large pool of semi-skilled and unskilled labour, especially, in the 15 to 49 age group.
Advantage Andhra Pradesh (2/2)
Facilitating infrastructure
The state has well-developed social, physical and industrial infrastructure and virtual connectivity, has good power, airport, IT and port infrastructure.
High economic growth

The GSDP of the state is growing at compound annual growth rate of 12 per cent annually. Vast natural gas reserves found in the KrishnaGodavari basin have opened up immense possibilities for the state economy.
Stable political environment

The state has a stable political environment with a single-party government. The State Government is committed towards creating a progressive business environment.
Andhra Pradesh in figures (1/2)

Parameter Economy GSDP as a percentage of all states GSDP Average GSDP growth rate (%)* Per capita GSDP (US$) Physical infrastructure Installed power capacity (MW) 13,409.4 159,398.5 Central Electricity Authority, as of March 2010 Cellular Operators Association of India, as of June 2010 As of October 2008 Ministry of Road Transport & Highways, Annual Report, 2008-09. Ministry of Shipping Industry sources 8.2 12.3 990.0 100.0 11.8 992.5 CMIE, as of 2007-08, current prices CMIE, 2000-01 to 2007-08, current prices CMIE, as of 2007-08, current prices Andhra Pradesh All-states Source
GSM cellular subscribers (No)

Broadband subscribers (No) National highway length (km) Major and minor ports (No) Airports (No)
33,325,765
400,663 4,537.0 1+13 9
456,586,162
4,981,976 70,548.0 12+187 133
Social indicators
Literacy rate (%) Birth rate (per 1,000 population)
* In terms of Indian rupee
60.5 18.4
64.8 22.8
Census of India, 2001 Ministry of Health & Family Welfare, RHS Bulletin, March 2008
Andhra Pradesh in figures (2/2)

Parameter Andhra Pradesh All-states Source
Ease of doing business

FDI inflows (US$ billion) Outstanding investments (US$ billion) Industrial infrastructure PPP projects (No) 74 515 www.pppindiadatabase.com Functional as of August 2010, www.sezindia.nic.in 4.8 146.1 120.2 1,972.6 Department of Industrial Policy and Promotion, April 2000 to May 2010 CMIE, as of March 2010
SEZ (No)
22
121
PPP: public private partnership, SEZ: special economic zone
Parameter Policy support Sectors with specific policies Availability of labour
Andhra Pradesh Government
Industry overall, biotechnology, Information and communication technology, tourism, textile and apparel Adequate skilled labour available
Key industries with policy thrust and factor advantages

Industry attractiveness matrix
High
Bulk drugs and pharmaceuticals IT and ITeS Textiles and apparel Agro and food processing Biotechnology
Policy thrust
Medium
Low
Medium *Factor advantage
High
*Factor advantages include benefits due to geographical location and availability of factors like talent pool, natural resources and capital
ANDHRA PRADESH
November 2010
Contents
10
STATE ECONOMY AND SOCIO-ECONOMIC PROFILE Andhra Pradesh November 2010
Socio-economic snapshot of Andhra Pradesh

Parameters Capital Geographical area (sq km) Administrative districts (No) Population density (persons per sq km) Total population (million) Male population (million) Female population (million) Decadal population growth rate (%) Sex ratio (females per 1,000 males) Literacy rate (%) Male (%) Female (%) Average life expectancy (years)
Sources: Andhra Pradesh Government (www.aponline.gov.in) Director, Census Operations, A.P. Hyderabad Directorate of Economics and Statistics, Hyderabad CMIE
Andhra Pradesh Hyderabad 275,100 23 277 76.2 38.5 37.7 14.6 978 60.5 70.3 50.4 63.9
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Andhra Pradeshs GSDP

At current prices, the Gross State Domestic Product (GSDP) was US$ 85.8 billion in 2009-2010. Between March 2000 and March 2010, the average annual GSDP growth was 12 per cent. This growth was primarily driven by the service sector and was supported by primary and secondary sectors.
Andhra Pradeshs GSDP (US$ billion)
100.0 80.0 60.0 40.0 20.0 0.0 1999-00 Source: CMIE 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 27.6 30.0 32.6 36.6 43.5 CAGR 12% 46.9 53.3 81.2 66.0 82.0 85.8
12
Andhra Pradeshs NSDP
At current prices the Net State Domestic Product (NSDP) of Andhra Pradesh was about US$ 76.9 billion in 2009-2010. The average NSDP growth rate between 1999-2000 and 2009-2010, was about 11.9 per cent.
Andhra Pradeshs NSDP (US$ billion)
100.0 80.0 60.0 40.0 25.0 20.0 0.0 1999-00 Source: CMIE 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 29.6 33.1 39.5 CAGR 11.9% 72.7 73.7 76.9
58.9
47.6
42.1
27.1
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The tertiary sector has an increasing share in Andhra Pradeshs economy

Percentage distribution of GSDP
In 2009-2010, at US$ 41.9 billion, the tertiary sector contributed 48.9 per cent to the GSDP (at current prices). It was followed by the primary sector, contributing 28.7 per cent (US$ 16.6 billion) and the secondary sectors contribution of 22.4 per cent (US$ 19.3 billion). During the period, secondary sector had largest growth of 12.8 per cent followed by tertiary sector (12.3 per cent) and primary sector (10.9 per cent).
100% 80% 60% 40% 20% 21.0 31.6 1999-00 Primary sector Source: CMIE Secondary sector 22.4 28.7 2009-10 Tertiary sector 47.4 48.9
CAGR
12.3%
12.8% 10.9%
0%
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Per capita GSDP
The per capita GSDP of Andhra Pradesh increased almost 2.8 times from US$ 366.4 in 1999-2000 to US$ 1,025.6 in 2009-2010. A robust tertiary sector has helped Andhra Pradesh increase its average per capita GSDP by over 10.8 per cent between 1999-2000 and 2009-2010.
Per capita GSDP
1,200.0 1,000.0 800.0 US$ 600.0 400.0 200.0 0.0 1999-00 Source: CMIE 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 366.4 394.0 426.5 553.1 471.6 CAGR 10.8% 589.4 662.7 990.0 812.9 990.0
1025.6
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Industries in Andhra Pradesh
The natural resources, policy incentives and infrastructure in the state are favourably suited for investments in major sectors such as drugs and pharmaceuticals, biotechnology, IT and ITeS, mines and minerals, textiles, leather and tourism. Andhra Pradesh is one of the foremost states to have developed sector-specific policies. Forming industrial clusters and developing infrastructure has been a key strategy of the state to attract investments in various industries. Between August 1991 and September 2009, the state has received 6,689 proposal for large scale industries, of which, 2,931 have been implemented attracting investment of US$ 11.5 billion and providing employment opportunity to 437,344 people.
Key industries in Andhra Pradesh
Agro and food-based industry

Biotechnology Bulk drugs and pharmaceuticals IT and ITeS Mines and minerals Textiles and leather
Tourism
Another 2,016 proposals with investment of US$ 60.4 billion are at various stages of implementation.
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Andhra Pradesh among the three largest food-grain producers in the country
In 2008-09, total area in the state under production of food grains was 7.4 million hectors which remained stable over last three years. However, because of increased productivity, production of food grains increased from 19.8 million tonnes in 2007-08 to 20.4 million tonnes in 2008-09. Major food grains^ produced in the state are rice, maize, pulses and jowar. Other major crops produced were sugarcane, cotton, groundnut, chilly and onion. In 2007-08, Andhra Pradesh was among the three largest producers in the country of rice, maize, groundnut and sunflower seeds.
Crop Sugarcane Rice
Annual production (000 tonnes) 15,322.0 14,241.0 4,152.0 3,462.0 1,448.0 973.0 729.0 728.0 436.0 149.0 2.94
Maize Cotton Pulses Groundnut
Chilly Onion Jowar Greengram Mesta*
Source: Department of Agriculture, Government of Andhra Pradesh, Socio Economic Survey 2009-2010 as of 2008-09 *A variety of Jute, in million bales ^Food grains include rice, jowar, bajra, maize, ragi, wheat, pulses and other millets.
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Andhra Pradeshs exports trends
Andhra Pradeshs exports increased at a compound annual growth rate (CAGR) of about 26.6 per cent between 2001-02 and 2007-08. The states major exports products are software and electronic parts which contribute around 50 per cent of exports. Engineering goods, drugs and pharmaceuticals, leather, animal and marine products, and agriculture and agro-based products are other major export items.
Annual exports growth trends (%)

2007-08 21.3
2006-07
2005-06 2004-05 2003-04 2002-03 2001-02 0 10 16.2 20 30 40 50 3.8 23.5 26.0 29.7
50.3
In order to boost exports from Andhra Pradesh, the State Government offers a special package of incentives to the export oriented units (EOU).
Export package to EOUs under the Industrial policy
60
Source: Capital Markets
Sales tax exemption on purchase of raw materials.
Financial assistance through Andhra Pradesh State Financial Corporation (APSFC) at concession rates.
Grant of 30 per cent on ground rent for participation in the international trade fairs, subject to a maximum limit of nine sq m.
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Investments and FDI inflows
According to the Reserve Bank of India, FDI inflows from April 2000 to May 2010 amounted to US$ 4.8 billion. The state has had a healthy FDI inflow over the years, primarily, in sectors related to IT and ITeS, automotive, engineering and electronics. Of the total outstanding investments of US$ 146.1 billion as of March 2010, Andhra Pradesh had a well balanced distribution by sectors with manufacturing, electricity, services, irrigation and construction sharing project investments of about 16 per cent to 32 per cent each.
Break up of investments by sectors as of March 2010
23.8%
22.5% 4.1%
Manufacturing Mining Electricity Services^
16.5% 31.8% 23.8%
Irrigation Construction
^Excluding financial services Source: CMIE
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ANDHRA PRADESH
November 2010
Contents
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INFRASTRUCTURE STATUS Andhra Pradesh November 2010
Road network
As on March 2009, Andhra Pradesh has 17 National Highways running through it and covering 4,537 km. Roads under the State Road and Building Department was 69,051 km.
As on March 2009, road density per thousand population was 0.86 km.
As of August 2010, there were 41 publicprivate partnership (PPP) projects in the roads sector that are at various stages of development.
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Railway network (1/2)
Andhra Pradesh has a total railway network of 4,287.4 km, which is under the control of the South Central Railway with Secunderabad as the headquarters. The state has a total of 748 railway stations. The rail network comprises of 4,102.7 km of broad gauge and 184.7 km of metre gauge tracks. When completed, the Mass Rapid Transit Service (MRTS) project is expected to carry about 1.5 million passengers per day by 2015 and 2.2 million passengers per day by 2025. The total cost for the MRTS project has been estimated at US$ 2.6 billion. The Central Government has already sanctioned 20 per cent of the project cost through the viability gap funding (VGF) mode.
South Central Railway network Division Secunderabad Broad gauge 1,311.2 945.8 1,121.6 617.2 569.6 823.0 5,388.3 Metre gauge 0.0 0.0 184.7 0.0 0.0 175.9 360.6 Total 1,311.2 945.8 1,306.2 617.2 569.6 998.9 5,748.9
Vijaywada Guntakal Guntur
Hyderabad Nanded Total
Sources: South Central Railways website, http://scrailway.gov.in, AP Admin setup, Directorate of Economics and Statistics website, www.apdes.ap.gov.in, Project description, Hyderabad metro rail website, www.hyderabadmetrorail.in
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Railway network (2/2)

The state is the first to have a PPP Metro Rail project sanctioned by Government of India. The metro rail project is environmental friendly and is expected to reduce pollutants by about 3,100 tonnes per annum (TPA). In September 2010, construction work of the project has been awarded to Larsen & Toubro Limited through competitive bidding process.
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Airports
The state has an international airport at Hyderabad and domestic airports at Visakhapatnam,Tirupati, Rajahmundry,Warangal,Vijayawada, Donakonda, Kadapa and Puttaparthy. Hyderabad is connected to several key international destinations such as Amsterdam, Bangkok, Chicago, Frankfurt, Dubai, Singapore, Sharjah, London and Kuala Lumpur, besides all major destinations across India. The Rajiv Gandhi International Airport near Shamshabad (about 27 km from Hyderabad) is a newly completed airport. It has replaced the former international airport of the city at Begumpet. The total cost for this project was US$ 560 million, it has been built on an area of 5,449 acres.
GMR-Hyderabad International Airport Limited (GHIAL), Shamsabad Started operations in May 2008. Constructed by the consortium of: GMR group Malaysia Airport Holding Berhad (MAHB) Government of Andhra Pradesh Airports Authority of India Single terminal, expandable structure Final capacity of 40 million passengers per year and one million tonne of cargo. Total built-up area of 900,000 sq m. Lufthansa Technik to set up a maintenance, repair and overhaul (MRO) facility at the airport. A new flight academy to be established at the airport.
Source: GHIAL website, www.hyderabad.aero
24
Ports

Andhra Pradesh has the second-highest cargo-handling port after Gujarat. The Visakhapatnam port ranks amongst the top three of the 12 major ports in the country. In 2009-2010, it had a port traffic of 65.5 million tonnes which accounted for 11.7 per cent of total port traffic at all major ports.
Coking coal, iron ore, petroleum products and thermal coal are some of the key products handled by the port. It also has a high volume of container traffic.
Other than Visakhapatnam, the state has 13 intermediate and minor ports. In 2008, the minor ports at Andhra Pradesh handled about nine per cent of the total traffic at all minor ports across the country.
70 60 50 40 30 20 10 0 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010^ 22 23 26 30 33 34 36 36 40 45 44 46 48
Visakhapatnam Port Traffic (million tonnes)

56 50 56.3
64.5
63.9
65.5
^Year ended in March 2010 Source: Visakhapatnam port
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Telecom infrastructure
As of December 2009, Andhra Pradesh had 4,166 telephone exchanges and 2.5 million wire line telephone connections. The number of public call offices as of March 2009 was 200,291. There are about 41.4 million cellular subscribers (GSM and CDMA) and 400,000 broadband connections.
The State Government has appointed an agency to provide reliable communications backbone, which will provide gigabit ethernet connectivity to all government departments and 40,000 offices across the state. It would connect the state secretariat to district headquarters, mandals and villages, bringing the information superhighway to the doorstep of the common man in rural areas. The broadband network being implemented with private participation would connect the state headquarters with 10 gigabit per second (gbps) to each district headquarter, one gbps to each of the 1,128 mandal headquarters and 100 megabit per second to each of the villages. As of January, 2010, there were 16,146 post offices in the state.
The state has approximately 44,000 km of fibreoptic cable network with public and private sector connectivity.
Reliance Communications has created infrastructure for providing the required bandwidth for basic telecom services and other high-end services by laying a fibre-optic cable backbone of 3,000 km throughout the state.
Sources: Chief General Manager, Telecom, Andhra Pradesh, Department of Telecommunication, annual report 2009-2010
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Power (1/2)
As of March 2010, Andhra Pradesh had a total installed power generation capacity of 13,409.4 MW, which comprised 7,688.5 MW under state utilities, 3,129.3 MW under central utilities and 2,591.6 MW under the private sector. Coal- and gas-based thermal power plants with installed capacity of 6,260 MW and 2,580.4 and hydropower plants with capacity of 3,617.5 MW were major sources of electric power in the state. The entire capacity of gas-based power plants is contributed by the private sector. Per capita consumption of electricity was 746 units in 2008-09.
Installed power capacity (MW)

14,000.0 12,000.0 10,000.0 8,000.0 6,000.0 4,000.0 2,000.0 0.0 2005-06 2006-07 2007-08 2008-09 2009-10 11,809.4 11,483.6 11,866.8 11,639.1 13,409.4
Source: Central Electricity Authority
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Power (2/2)
The integrated Andhra Pradesh State Electricity Board (APSEB) was restructured in 1999 to form the following companies:
Segment Power generation Power transmission Power distribution Company name Andhra Pradesh Power Generation Corporation Limited (AP Genco) Transmission Corporation of Andhra Pradesh Limited (AP Transco) Central Power Distribution company of Andhra Pradesh Limited (APCPDCL), Hyderabad Southern Power Distribution Company of Andhra Pradesh Limited (APSPDCL), Tirupati Eastern Power Distribution Company of Andhra Pradesh Limited (APEPDCL), Visakhapatnam Northern Power Distribution Company of Andhra Pradesh Limited (APNPDCL), Warangal AP Gencos hydro-power plants AP Gencos thermal power plants
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Urban infrastructure (1/2)

Sewerage system and solidwaste management system
Water supply
Per capita water supply across key cities
The average per capita supply of water in major cities is 106 lpcd* A coverage of 85 to 90 per cent in the core city areas. Operation and maintenance costs being recovered from water tariffs is high, at 85 per cent in Hyderabad.
Solid waste collection efficiency is very high across the cities of Andhra Pradesh and varies from 85 to 100 per cent, on an average, for all the cities
Area coverage of the sewerage system in the major cities varies from 10 per cent to 45 per cent
Current per capita supply (litres/day)
Desired Level
Source: Commissionerate of Industries, Andhra Pradesh, 2006 * litres per capita per day
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Urban infrastructure (2/2)
Under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM), 50 projects costing US$1,162.1 million have been sanctioned for Hyderabad,Visakhapatnam,Vijayawada and Tirupati. Some of the key areas of development are roads/flyovers, water supply, storm water drainage, old city drains, solid-waste management and mass rapid transport system. Projects of value US$ 216.3 million have been completed in 2005 and 2007. In 2007-08, one project of US$ 150.8 million have been completed. These projects were located in Hyderabad and Vishakhapatnam and related to roads, water supply, drains/storm water drains and sewerage. In 2009-2010, the Central Government has released US$ 52.5 million for 22 projects.
Sewerage treatment infrastructure (%)

50 40 30 20 10 10 0 Hyderabad Vijaywada Vishakapatnam Treated (%) Area Coverage (%) 10.5 23 45 40
Visakhapatnams urban Infrastructure snapshot

Visakhapatnam has a high per capita road length of 1.03 km. Percentage of pucca roads in the cities varies from 70 per cent to 95 per cent. Percentage coverage of storm water drains varies from 30 per cent to 50 per cent.
Source: JNNURM, Ministry of Urban Development, www.urbanindia.nic.in
30
Key public private partnership projects

Project name Sector Ports Ports Roads PPP type BOOT BOT-Toll BOT-Toll Project cost (US$ million) 3,652.2 358.6 344.6 Stage Construction Construction Construction
Vodarevu Nizampatnam ports and port-based corridor development

Gangavaram Port Cuddapah Mydukur Kurnool road
Integrated solid waste management for Hyderabad

Four-laning of Hyderabad Karimnagar Ramagundam road Narketpally Addanki Medaramitla road Bus terminal and commercial development at Musheerabad Health spa and resort Four-laning of Khammam Tallada Devarapally road Four-laning of Perecherla Thokapalli road Four-laning of Warangal Khammam road
Source: www.pppindiadatabase.com
Urban development
Roads Roads Urban development Tourism Roads Roads Roads
DBFOT
BOT-Toll BOT-Toll Lease Lease BOT-Toll BOT-Toll BOT-Toll
195.0
295.2 260.2 54.3 13.0 143.5 113.5 103.5
Construction
Bidding Bidding Bidding Bidding EOI EOI EOI
EOI-Expression of interest, BOOT: build-own-operate-transfer, BOT: build-operate-transfer, DBFOT: design-build-finance-operate-transfer
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Education sector (1/2)

The state had a literacy rate of 60.5 per cent in 2001 as against 44.1 per cent in 1991. In 2001, the male literacy figure stood at 70.3 per cent, while female literacy was at 50.4 per cent.
In 2008-09, total of 13.7 million students were enrolled in 98,027 schools. There were 65,609 primary schools, 14,942 upper primary schools, 17,376 high schools and 100 higher secondary schools. The total number of teachers was 449,145.
The state adds more than 100,000 engineering graduates, 12,000 management graduates and 350,000 English-speaking graduates every year. The Hyderabad University and the Osmania University are among the leading universities of the country.
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Education sector (2/2)
At the intermediate college level, courses are available in the science, arts and commerce streams. Vocational courses are offered in the fields of agriculture, engineering and technology, home science, paramedical, business and commerce, and humanities. In 2009-2010, there were 4,611 junior colleges with a total enrolment of 0.8 million students.
Engineering
Colleges by courses, 2009-2010 Course Number of colleges 656 703 881 278 213
Master of Computer Application (MCA) Master of Business Administration (MBA) Bachelor of Pharmacy Polytechnics
The Technical Education Department of Andhra Pradesh supports 656 engineering colleges.
Degree colleges, 2009-2010 Degree colleges

Source: Socio Economic Survey 2009-2010, Government of Andhra Pradesh
Life-sciences institutes

Government colleges: 249 Aided colleges: 179 Un-aided colleges: 1,459^ Under-graduate and post-graduate colleges: 5,236^
^As of 2008-09 Source: Socio Economic Survey 2009-2010
Centre for Cellular and Molecular Biology Centre for DNA Fingerprinting and Diagnostics Indian Institute of Chemical Technology International Crop Research Institute for Arid and SemiArid Tropics (ICRISAT) Directorate of Rice Research, National Academy of Agricultural Research Management National Institute of Nutrition Indian Council of Agricultural Research Centres.
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Health infrastructure
As of March 2008, Andhra Pradesh had 1,570 primary healthcare centres (4-6 beds in each), with 2,214 doctors. There were 167 community healthcare centre (30 beds in each) with 235 specialists. There are 12,522 sub-centres in the state. Hyderabad has approximately 60 hospitals that classify as authorised centres for providing medical services.
Leading hospitals in Hyderabad
Apollo Hospital
Yashoda Super Specialty Hospitals
Care Hospital Wockhardt Kamineni Hospital Nizams Institute of Medical Sciences
MNJ institute of Oncology and Regional Cancer Centre
Indo-American Cancer Institute and Research Hospital

Global Hospital Medwin Hospital
Health indicators Birth rate* Death rate* Infant mortality rate**

*Per thousand persons ** Per thousand live births Source: Ministry of Health & Family Welfare As of March 2008
Medicity Hospital 18.4 7.5 52 L V Prasad Eye Institute Krishna Institute of Medical Sciences
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Cultural infrastructure
There are several sports complexes in Hyderabad, Visakhapatnam,Tirupati and other cities. Swimming and tennis are the major sports although, other games are also popular. The Boulders Hill in Hyderabad, The Army Golf Course in Secunderabad and the East Point Golf Club in Visakhapatanam are well known golf courses in the state. The Tirupati temple in Southern Andhra Pradesh makes the state one of the leading religious tourism spots in the country. AP Tourism promoted convention centres in Hyderabad state include Taramati Baradari, Hyderabad International Convention Centre, Shilpa Kala Vedika, HITEX, Marriott Convention Centre, Ramoji Film City, Katriya De Royal Convention Facilities.
Major stadiums and sports complexes in Hyderabad Swarnandhra Pradesh Sports Complex G. M. C. Balayogi Athletic Stadium Gachibowli Indoor Stadium Fateh Maidan Sports Complex The Lal Bahadur Stadium The Lal Bahadur Stadium Aquatics Complex Kotla Vijay Bhaskar Reddy Indoor Stadium SAAP Tennis Complex, Fateh Maidan Shooting Range, Hyderabad Central University Rajiv Gandhi International Cricket Stadium
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Industrial infrastructure development (1/2)
On the industrial infrastructure front, the state has taken a number of developmental initiatives to achieve consistent economic growth. The Government has initiated a set of prestigious projects including those in industrial infrastructure for the specific sectors, through the Andhra Pradesh Industrial Infrastructure Corporation Limited (APIIC). As of 2008-09, there were 69 Software Technology Parks of India (STPI) in the state. APIIC has already helped set up over 300 industrial estates and specialised parks including the L&T Infocity, ICICI Knowledge Park, SP Bio-tech Park, Marine Bio-tech Park, Agri Bio-tech Park, special economic zone (SEZ), Pharma City, Hardware Park, HITEC city, leather parks, food processing park and agri-export zones. As of August 2010, 1,303 units were registered with the STPI, Hyderabad.
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Number of STPI registered in India and Andhra Pradesh (No)

1400 1200 1000 800 1164 1052 845 616
600
400 200 173 174
176
69
0 2005-06 2006-07 All India 2007-08 AP 2008-09
Sources: IT parks, IT SEZs, IT and Communications Department website, http://apit.ap.gov.in, Export Performance of IT/ITES Industry for the year 2008-09- presentation, STPI website, www.hyd.stpi.in
Industrial infrastructure development (2/2)
Integrated Infrastructure Development Centres (IIDC) to establish industries in rural/backward areas and provide agricultureindustry link. Centres are located in Nandyal (Kurnool),Tada (Nellore), Keelapattu and Madikonda (Warangal), Gajularamaram (Ranga Reddy) and Surampally (Vijaywada). The Central Government has given formal approval to 106 SEZs, in-principle approval to four SEZs and 74 notified SEZs. APIIC has developed an Export Promotion Industrial Park (EPIP), spread over 204 acres in Medak, at an estimated cost of US$ 35.36 million. Critical Infrastructure Balancing Scheme (CIBS) to fund Industrial associations/service societies/NGOs for development of critical infrastructure.
Genome Valley Genome Valley is Indias first state-of-the-art life sciences cluster, spanning 600 sq km in Hyderabad. Provides access to world-class infrastructure to domestic and international companies. Comprises dedicated parks such as ICICI Knowledge Park and Shapoorji Pallonji Biotech Park developed on a public-private partnership (PPP) model.
Larsen & Toubro (L&T) Infocity

Developed jointly by APIIC and L&T. Spread across 158 acres at Madhapur with state-of-theart infrastructure. Built in three phases with total built-up area of 1.8 million sq ft on 20.7 acres of land. Employs more than 12,500 persons.
Sources: Commissionorate of Industries, Andhra Pradesh, 2006, SEZ India website, www.sezindia.nic.in, Andhra Pradesh Government budget website, http://budget.ap.gov.in
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SEZs and industrial clusters

Upcoming SEZs Industrial clusters in AP
ANDHRA PRADESH
Industrial Clusters
MAHARASHTRA Sircilla Warangal Rangareddy Hyderabad Bheemavaram Nalagunda Guntur Karnool Kadapa Hindupur Chittoor Kuppam Ongole Vijaywada Khammam Vizianagaram Vishakapatnam MADHYA PRADESH
KARNATAKA
Nellore
Automobiles & Engineering IT / ITES Pharma / Biotech Mineral Textile & Apparel Food Processing
TAMIL NADU
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Infrastructure investments
Infrastructure investments in Andhra Pradesh were over US$ 33.4 billion, as of March 2010. Over 56 per cent of investments in infrastructure were in the area of power generation and distribution. About 15.3 per cent of the investments were in the road sector, while another 14 per cent were in the railways sector. Other sectors such as shipping (8.8 per cent), airport (3.5 per cent) and oil and gas (2.3 per cent) also attracted investments.
Infrastructure type Power* Roads Oil and gas Railways Airport Shipping Total
*Generation and distribution Source: CMIE As of March 2010
Investments (US$ million) 18,864.7 5,122.8 753.1 4,571.5 1,162.8 2,927.6 33,402.5
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Existing mega parks

Location (district) Chittoor Medak Ranga Reddy Name of the park Food processing park Export promotion industrial park Agri-biotech park Apparel park Biotech park Financial district Gems and jewellery park Hardware park Hi-Tech city Hitex exhibition centre ICICI knowledge park Industrial estate for lady entrepreneurs International convention centre Mind Space IT parks Visakhapatnam AP SEZ JN Pharma City park Visakhapatnam industrial water supply project Visakhapatnam SEZ
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Upcoming specialised parks

Location (district) Ranga Reddy Name of the park Pharma cluster Location (district) Visakhapatnam Name of the park Brandix textile city
Business district and trade towers

Rajiv Gandhi nanotech park Semindia Fab city Hardware park Aero park Auto park Nalgonda Medak Anantpur
IT park
Apparel export park Marine biotech park Handloom textile park Textile park Textile park
IT parks (three)
Guntur
Khammam
Food processing park

Food processing park Textile park Petroleum. Chemicals and Petrochemicals Investment Region (PCPIR) Food processing park
Sircilla, Karimanagar Vijayawada, Krishna
Textile park Auto component
Mahabubnagar Visakhapatnam, Vizianagaram, East Godavari Nellore
IT park
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Sector-specific industrial parks (1/2)

Industry
Lifesciences
Name of the park, location

Agri-science park
Brief description
The State Government and ICRISAT have jointly set up an agri-science park at the ICRISAT campus to support the growth of agri-based biotech industry in the state. JNPC project is being developed at Parwada, Visakhapatnam, at an estimated cost of US$ 73.17 million through a PPP model between the State Government and Ramky Pharma City (India) Limited. Infrastructure includes water supply, hazardous waste management facilities, effluent treatment plants, power and street lighting. Designed by JTC - Jurong Corporation of Singapore, it has a saleable area of 1,420 acres and the remaining 700 acres would have common facilities and utilities with green areas and open spaces in the park. About 600 acres have been earmarked for setting up a Pharma SEZ.
Jawaharlal Nehru Pharma City (JNPC)
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Sector-specific industrial parks (2/2)

Industry Apparel and textile Name of the park, location Apparel Export Park Brief description The park is spread over 172 acres in Gundlapochampally and has units exporting to the US, the UK and other countries and for stores such as WalMart and JC Penny. The park has been developed on 60 acres for providing facilities such as training centres, business resource centres, textile processing units, testing labs, CAD centres, common effluent treatment plants, has a 33/11 kV substation with uninterrupted power supply, assured water supply and singlewindow clearance for all approvals. Centre Government approved project under the Textile Centre Infrastructure Development Scheme. So far, 50 acres of land have been developed. Set up in an area of 1,000 acres at a project cost of US$ 609.8 million by Brandix Lanka Limited. Commercial operations started in January 2007. Project developed on 146 acres of land for accelerated industry growth there. Proposed to be developed as a natural garment cluster with basic infrastructure facilities and skilled manpower. The Government has identified 50 acres on National Highway-9 near the Pochampally Silk City and has approved the project at an outlay of US$ 810,000.
Textile Park, Sircilla
Textile Park, Pashamylaram
Brandix India Apparel City, Visakhapatnam Apparel Export Park, Visakhapatnam Textile Park, Pamidi Handloom Apparel Park, Pochampally
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Virtual infrastructure
E-seva
Rajiv Internet Village
AP online
E-procurement
Presence of e-governance initiative, which offers a wide spectrum of citizenfriendly services One-stop shop for services of various state and central government departments in an efficient, reliable, transparent and integrated manner Facilitates online transaction processing of payments, issue certificates, permits, licenses and many other services
Launched by the State Government in August 2004, its objective is to bring government services/benefits closer to people living in rural areas. Further, it aims to provide computer literacy to at least one person in each family in rural areas Provides high bandwidth connectivity in rural areas
E-governance: gateway for the State Government, offers multiple services through a single window to citizens Developed and launched by the Government in partnership with Tata Consultancy Services Facilitates online submission of forms including registrations, licences, permits, certificates and representations to different government departments. Facilitates online payments for utilities, taxes, fee, deposits and stamp duties.
Automates procurement and purchase procedures spanning from demand aggregation to procurement and fulfilmentof the State Government. Presently, the portal is servicing 29 government departments, 39 public sector undertakings, four universities and 127 urban local bodies. Over 61,000 tenders with work amounting to US$ 26.3 billion have been handled through the portal.
Source: "Mauritius pact with State Government", Eprocurement website, www.eprocurement.gov.in
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ANDHRA PRADESH
November 2010
Contents
45
STATE POLICIES AND INCENTIVES Andhra Pradesh November 2010
Sector-specific policies (1/12)

Andhra Pradesh Industrial Investment Promotion Policy (IIPP), 2010-2015 Vision: To build a strong and vibrant industrial economy that spins off large capital formation in the state and advances inclusive development of all sections of people and industry, that creates increasing employment opportunities, and raises wage incomes to higher levels through skill upgradtion so as to improve the quality of life of citizen of the state. Objectives:

Promote Andhra Pradesh as the best investment destination. Increase growth of manufacturing sector from 12 per cent to 17 per cent per annum. Creation of additional employment of 500,000 persons per year (200,000 direct employment and 300,000 indirect employment). Attracting US$ 3.16 billion of investment in the manufacturing sector, every year . Provide special focus on micro-, small- and medium scale enterprise (MSME) with emphasis on food processing. To enhance the knowledge and skills of human resources for better productivity and global competitiveness. To create enabling environment for ensuring maximum value addition to the abundantly available resources. To build conducive ecosystem for sustained growth of industry.
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IIPP, 2010-2015 (continued) Incentives: For micro- and small- enterprises (MSE):
Subsidy of 15 per cent of fixed capital investment ,subject to a maximum of US$ 42,194.
Reimbursement of 100 per cent of value added tax (VAT) / central sales tax (CST) or state goods and service tax (SGST) for a period of five years for micro enterprises.
Reimbursement of 50 per cent of VAT, CST or SGST for a period of five years for small enterprises. Interest subsidy on term loan for MSEs in excess of three per cent per annum subject to a maximum of nine per cent per annum for a period of five years. Providing tender forms free of cost. Exemption from paying earnest money deposit (EMD) and security deposit (SD). Price preference to the extent of 10 per cent, i.e., where the bid by micro and small enterprises are within 10 per cent of lowest bid, the local micro and small enterprises will be offered reasonable part of the order at lowest bid value. Reimbursement of 50 per cent of cost incurred in quality certification / patent registration, to an upper limit of US$ 4,219.
Incentive for medium and large industries:

Reimbursement of 25 per cent of VAT, CST or SGST for a period of five years for medium and large enterprises. All projects with investments more than US$ 52.7 million or providing employment for more than 2,000 people, will be classified as mega projects and will be considered for tailor-made benefits, based on factors such as technology induction, employment opportunity, location of units, etc.
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IIPP, 2010-2015 (continued) Incentives: For enterprises managed by women: Enterprises started by women entrepreneurs as sole proprietary concerns/partnership/private limited companies or cooperatives which have 100 per cent women participation in the enterprise will be eligible for the following benefits:

All the benefits as per IIIP, 2010-2015. Additional five per cent (i.e., total of 20 per cent) subsidy on investment, limited to US$ 10,548. Reservation of 10 per cent of land in the industrial estate / parks developed by APIIC.
For enterprises managed by entrepreneurs belonging to scheduled cast (SC) and scheduled tribe (ST): Industrial units which have been established under sole proprietorship of SC/ST entrepreneurs or those partnership or private limited companies with 100 per cent share belonging to SC/ST entrepreneurs will be eligible for following benefits:
Reimbursement of 100 per cent of stamp duty and transfer duty paid by the industry on purchase of land meant for industrial use. Reimbursement of 100 per cent of stamp duty for lease of land/shed/building and also for mortgages and hypothecations. Reimbursement of 25 per cent of land conversion charges for the industrial use, limited to US$ 21,097.
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IIPP, 2010-2015 (continued) Incentives: For enterprises managed by entrepreneurs belonging to scheduled cast (SC) and scheduled tribe (ST) (continued):
Seed capital assistance to first generation entrepreneurs to set up micro enterprises in form of 10 per cent subsidy on cost of machineries , which will be deducted from the eligible investment subsidy. Interest subsidy on term loan for fixed capital investments by micro and small enterprises in excess of three per cent per annum subject to a maximum of nine per cent per annum for a period of five years. Preferential allotment of land in the industrial estates developed by APIIC. Subsidy of 35 per cent on fixed capital investment, additional five per cent subsidy for SC/ST women and additional five per cent investment subsidy for the units set up in the scheduled areas by ST entrepreneurs up to a maximum limit of US$ 105,485. 33.33 per cent subsidy on land cost at industrial estates and industrial development areas, limited to US$ 21,097. Cost of power will be reimbursed at US$ 2.1 cent per unit for five years as per guideline. Micro, small, medium and large enterprises will be reimbursement VA, CST or SGST to the extent of 100 per cent, 50 per cent and 25 per cent respectively. Subsidy of eight per cent on capital expenditure on equipments for technology upgrade, limited to US$ 105,485 (for MSMEs)
Reimbursement of 50 per cent of expenses incurred for quality certification/patent registration up to a limit of US$ 4,219 for MSMEs.
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Information and Communications Technology (ICT) Policy, 2010-2015 Objectives: To make Andhra Pradesh as one of the fore runners in IT sector in the country. The objective will be achieved through the following:
Provision of congenial, industry-friendly and proactive climate for IT companies to locate, grow and sustain their operations in most competitive and hassle-free environment.
Creation of employment opportunities to the educated youth of all sections of the society across all regions. Achieving higher levels of exports resulting in enhanced productivity, and augmentation of GSDP. To spread IT to nook & corner of the state. Leverage IT as a tool for the socio-economic development of the state.
Key targets:

Achieve exports of US$15 billion by the IT sector in the state. Achieve annual growth rate of 17 per cent for the IT sector in the state. Generate 125,000 direct employment. Generate 500,000 indirect employment. Computer training for e-literacy. Special focus areas of the policy are start up companies, small and medium enterprises (SMEs), IT product/research and development companies, SC/ST entrepreneurs, women entrepreneurs, animation, gaming and digital entertainment, engineering services, tier-II locations (Vijayawada, Tirupati, Kakinada and Warangal), tier-III locations (other than Hyderabad and tier-II locations) , promotion of IT incubation facilities at engineering colleges, corporate social responsibility, promotion of womens participation in IT sector, electronic hardware (non-hazardous) and eGovernance.
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ICT Policy, 2010-2015 (continued) Incentives:
IT/ITeS units will be exempt from the purview of the Andhra Pradesh Pollution Control Act, except with respect to power generation sets. IT/ITeS units and companies will be exempt from the statutory power cuts. IT industry will be exempt from inspections under the following, barring inspections arising out of specific complaints:

The Factories Act 1948. The Maternity Benefit Act 1961. The AP Shops & Establishments Act 1988.
The Contract Labour (Regulation & Abolition) Act 1970.

The Payment of Wages Act 1936. The Minimum Wages Act 1948. The Employment Exchanges (Compulsory Notification of Vacancies) Act 1959.
Three shift operations with women working in the night for IT/ITeS units or companies will be granted. IT/ITeS units or companies and non-hazardous hardware manufacturing industry are declared as essential service under AP Essential Services Maintenance Act.
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ICT Policy, 2010-2015 (continued) Special incentives for special focus areas:

Reimbursement of stamp duty, transfer duty and registration fee. Recruitment assistance. Subsidy on lease rentals. Subsidy on cost of power.
Subsidy on cost incurred in participating in exhibitions.

Subsidy on cost incurred in filing for patents and obtaining quality certifications. Subsidy on lease rentals. Subsidy on interest charges. Rebate on land cost.
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Textile and Apparel Policy, 2005-10 Objectives: To generate employment opportunities for an additional 1.5 million persons in the sector by 2010, to increase exports to US$ five billion to US$ six billion by 2010, to set up apparel exports and textile parks in clusters with state-of-the-art technology to attract investors, promote exports and generate employment opportunities, to introduce the system of PPP and special incentives to high value and high employment-generation projects. Incentives: All the incentives provided in the Industrial Investment and Promotion Policy are automatically applicable to textiles and apparel units.
Fresh Food Policy, 2005 Incentives: Reimbursement of cost of power to be extended for a period of five years from April 2005.
Food processing units that commenced commercial production after November 14, 2003, are eligible for reimbursement of power costs.
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Tourism Policy, 2006 Objectives: To create a unique selling proposition and a brand image for the state, to ensure deserved positioning on the tourism map of India and the world, to create and differentiate tourism products across segments such as eco-tourism, pilgrimage, heritage, business, sports, spiritual, health, leisure and rural tourist, to provide incentives and concessions to tourism projects to be set up in special tourism areas with assurance on features such as sustainable employment generation, promotion of rural tourism and commercially viable projects, to develop the sector through public private partnerships (PPP), to adopt a single-window clearance system. Incentives and concessions:
Concession on allotment of land on a long lease of 33 years. For mega projects, the lease period to exceed 33 years and lease rent shall be 10 per cent of market value, subject to review every five years. Investment subsidy of 20 per cent of project cost and 15 per cent for up-gradation of existing hotels, limited to US$ 48,000. 100 per cent reimbursement of stamp duty and transfer fee on purchase of land or lease of land meant for the project. Reimbursement of 25 per cent of value-added tax and luxury tax paid for a period of five years. Reimbursement of 25 per cent of entertainment tax for multiplexes in theme parks and urban entertainment centres for a period of five years, limited to 100 per cent of the project cost for projects more than US$ 1.219 million and located in notified tourism areas or special tourism areas. Floor area index relaxation, and automatic conversion/exemption from land-use zoning regulations.
Market development assistance scheme for promotional activities
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Electronic Service Delivery Policy, 2003 Aim: To evolve a comprehensive and generic policy that permits rapid growth of electronic delivery of services under egovernance projects such as e-Seva, APonline, e-Procurement, CARD and i-Community.
Key provisions and incentives:

To adopt new and more efficient, cost-effective delivery channels with suitable interfaces for backward integration. The Government to establish a standards-based e-government Gateway to enable the various service providers to interact with the backend databases and applications of various government departments and agencies and provide cost-effective services to the citizens and businesses. To avoid the problem of limited suitability of all the delivery points and channels for delivering all the services, those services involving checking of documents, issue of certificates, licenses needing authentication, etc., to be done at departmental outlets and/or e-Seva centres. For sustaining various citizen-service projects and initiatives, it is necessary that the concerned partner, vendor or entrepreneur is compensated on a per transaction basis. The transaction cost could be met either by the government department/agency or by the customer, depending on the nature of the service. The following principles are to be adopted in this regard:
No user charges to be collected from the citizen in respect of payment for utility bills and taxes, irrespective of the delivery channel. The concerned department or agency will pay the service charges to the service providers. In respect of other services such as information services, interactive services like online filing of forms, form submission and issue of certificates, a charge of US 11 cents to US 33 cents to be payable by the customer to the operator of the Service Delivery Point (SDP). The revenue sharing between the SDP, service providers and the government department to be mutually agreed between the various parties involved and specified in a Service Level Agreement (SLA).
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Biotechnology Policy, 2001 Objectives: To undertake a detailed inventory evaluation of the bio-resources in the state, to encourage research and development (R&D), to develop high-quality infrastructure and provide special incentives to biotech industry.
To create an enabling environment and simplify procedures, to facilitate the flow of venture capital funds and address issues such as Intellectual Property Rights (IPR). The thrust areas identified include diagnostics, therapeutics, pharmaco-genomics, bioinformatics, agriculture biotechnology, industrial biotechnology, inputs to the industry (hardware suppliers instrumentation and chemicals), marine biotechnology, forest and environment-focussed biotechnology, contract research in all areas of biotechnology and related areas. The strategy adopted involves encouraging R&D, developing infrastructure, providing incentives, land and grants for training institutes and housing, mega projects, developing adequate human resources, creating an enabling environment, funding biotech activities, and protecting IPR. The Andhra Pradesh Government is working on a new biotechnology policy.
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Biotechnology Policy, 2001 (continued) Key Incentives:
A sales tax of just one per cent for high-end biotech products manufactured by units located in the Biotech Park at Turkapalli village, Shamirpet mandal, Ranga Reddy district and others applicable for a period of seven years from the date of commencement of commercial production of a biotech unit and up to March 2010 and for units commencing operations before March 2006.
Government of Andhra Pradesh to provide government land on lease or as equity to other Biotech Parks, if the site is found suitable for such projects. Subject to certain conditions, bioinformatics companies will be offered rebate on the cost of government land allotted to them at US$ 440 per job created. Bio-informatic centres to be permitted to be established without any location restrictions. They can be established in residential, commercial or industrial zones. Companies setting up Bioinformatics Centres in the Genome Valley will get a rebate of US$ 660 per job created, subject to the value of a maximum of two acres of government land and 100 per cent exemption from registration and stamp duties. Similar incentive to be provided to the bio-informatic units to be set up in Biotech Parks. The biotech industry is exempt from the purview of statutory power cuts, industrial power tariff (and all other admissible incentives and concessions for industry) to apply. General permission to be accorded to run a three-shift operation to the biotech industry (subject to Government of India concurrence), permit flexibility in the opening and closing times and in the weekly holiday of a biotech unit by amending relevant provisions of the A.P. Shops and Establishment Act, exempt biotech units from the provisions of Contract Labour Act 1970, in so far as non-core activities are concerned, set up exclusive Special Industrial Tribunals for Biotech Parks to give top priority to the settlement of disputes that may arise in units located in the Biotech parks.
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ANDHRA PRADESH
November 2010
Contents
Company logos cited in this section are registered trademarks of the respective companies.
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BUSINESS OPPORTUNITIES Andhra Pradesh November 2010
IT and ITeS
Andhra Pradesh has had a steady growth in IT and ITeS exports from SEZs and Software Technology Park (STP), recording a 24.5 per cent growth in 2008-09 against the national average of 20.7 per cent. Total exports were about US$ 7.1 billion in 2008-09 (from STP and SEZ) against US$ 6.5 billion in 2007-08. Total employment generated by IT and ITeS industry in the state increased from 239,000 in 2007-08 to 251,786 in 2008-09. In 2008-09, employment generated by the IT sector has grown by 12,786 (including STP and SEZ units). As of July 2009, the state had attracted investments to the tune of US$ 110 million, of which investments from foreign companies were at US$ 2 - 3 million.
Key players

Mahindra Satyam Microsoft Genpact Cognizant Zensar Technologies iGate IBM Patni Computer Systems Tata Consultancy Services (TCS) Ikanos Communications HCL Intergraph CSC Sonata Software
As of August 2010, 1,303 IT and ITeS companies were registered under STPI, Hyderabad scheme.
STP: Software technology park
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IT/ITeS company profiles (1/4)

Mahindra Satyam Formerly, Satyam Computers, Mahindra Satyam was established in 1987 and has its global headquarters at Hyderabad and several offices in 38 countries including India. The company provides software solutions to over 370 customers including four of the top ten electronics and electrical equipment manufacturers, three of the top ten in aerospace and defence, two of the top five chemicals manufacturers and four of the top five networking and communications equipment manufacturers. Established in 1998, the Microsoft India Development Centres (MSIDC) is located in Hyderabad on a 42-acre state-of-the-art campus and employs around 1,500 employees. The company focuses on strategic and IP sensitive product development for Microsoft. It is Microsofts largest software development centre outside the US. It has established centres of excellence for storage, networking and mobility, and has filed over 270 patents in last five years. IBM is a leading global IT services and solutions provider with offices across the world. Products offered by companys India operations include software, storage, systems and servers, semiconductors, etc. IBM has been present in India since 1992. Since inception, IBM in India has expanded its operations considerably with regional headquarters in Bengaluru and offices in 14 cities including a global delivery centre in Hyderabad. According to the IT market research firm, Springboard Research, IBM emerged as the largest player with a 10.8 per cent share of the Indian IT services market in 2008. Founded as a captive arm of Dun & Bradstreet with headquarters in the US and operations in India, Cognizant now has over 50 development centres (including one in Hyderabad) and 25 regional sales offices, globally. Its services include business process outsourcing,, application and IT infrastructure services and business consulting. In 2009, the company earned revenue of US$ 1.2 billion. In December 2009, Cognizant invited 120 personnel working in Invensys Rail, at Hyderabad, to work on its recent global product research and development tie-up with the latter.
Microsoft
IBM
Cognizant
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Zensar Technologies Zensar technologies is an Indian company for IT enabled services with 20 offices around the world and three delivery centres, one of which is located at Hyderabad. Zensar provides end-to-end services from IT development to business process. Zensar has a strong engagement with Oracle, which is their worldwide certified partner, with a team of over 750 consultants. In the SAP space, Zensar provides template-solutions in key verticals of dairy, textile, pharmaceuticals, manufacturing and IT / operations. Zensar is one of the large partners of SAP in certain key segments and markets. Companys revenue in 2009-2010 was US$ 105 million. iGATE is an ITeS, consulting and BPO services provider. Registered in the US, iGATE has 34 offices across 16 countries. In 2009, total revenue of the company was US$ 195 million. The company has delivery centres in the US, UK, Canada, China, Malaysia and India. In Andhra Pradesh, it has an office at Hyderabad.
iGATE
Genpact
Genpact is a leading BPO company with delivery centres in 13 countries. It has three facilities in Hyderabad providing diverse specialised services in domains of IT infrastructure management, enterprise applications, procurement and supply chain services, finance and accounting services, and customer service to Genpact clients across the globe. The State Government allotted about 50 acres of land to Genpact in 2007-08 to set up an IT SEZ in Hyderabad.
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Patni Computer Systems Patni is one of the leading global providers of IT services and business solutions. Of the total 22 global delivery centres of Patni, three are located at Hyderabad. Revenue of the company in 2009-2010 was US$ 366 million. A company of the TATA group of India , TCS is a well recognised global service provider for a wide range of IT solutions, consulting, BPO, engineering services and IT infrastructure . In 2009-2010 total revenue of the company was US$ 4.9 billion. The company has 142 offices across the world at more than 42countries. It has four centres / offices in Hyderabad, two of which serve as innovations labs where cutting edge research in the field of IT and other domains such as life sciences, open source technologies and quantitative finance are carried out. Headquartered in the US, Ikanos has offices around the world to service a global customer base. Most of the company's engineering and research is conducted at Toronto (Canada), Bengaluru and Hyderabad. Ikanos develops robust, high performance semiconductor and software products. The company is a solutions provider to many of the worlds leading network-equipment manufacturers and telecommunications service providers, with more than 330 million ports shipped to date. Incorporated in 1976, HCL is a leading global technology and IT enterprise with annual revenue of US$ five billion. The companys operation span 26 countries. Has delivery facilities in the US, UK, Finland, Poland, Puerto Rico, Brazil, China, Malaysia, Singapore, Australia, Czech and India. In India, the company has offices in 170 cities and 500 points of presence reaching 4,000 towns. In Andhra Pradesh, HCL has offices located at Hyderabad and Vijayawada.
Tata Consultancy Services (TCS)
Ikanos Communications
HCL
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Intergraph
As a leading global provider of spatial information management (SIM) software, Intergraph Corporation fuses geospatial technology to security, helping some of the world's largest government, military, and industrial organisations in more than 60 countries better manage their operations and safeguard their infrastructure. In India, Intergraph Consulting Private Limited is a 100 per cent owned subsidiary of Intergraph Corporation. Incorporated in 1987, Intergraph Consulting is a strategic offshore development centre engaging in product development, customisation, research and development serving Intergraph customers worldwide. It has its India office at Secunderabad, Hyderabad. A US-based company, CSC was established in 1991 and since then has expanded its India operations to productively respond to the needs of their customers, worldwide. Recent acquisition s like that of Covansys and expansion activities have increased CSCs development and delivery centres to seven locations in the country including Hyderabad. In India, the company offers to clients worldwide, highvalue technology solutions including applications development and product support, infrastructure and BPO services. Incorporated in 1994, Sonata's services include IT consulting, product engineering services, application development, application management, managed testing, infrastructure management, packaged applications and travel solutions. As per the industry rankings released by NASSCOM for 2008-09, Sonata Software figured among the Top 20 IT Software Services Exporters in India for the second consecutive year. Headquartered in Bengaluru, Sonata has a development centre at Hyderabad. In 2009-2010, total revenue of the company was US$ 50 million.
CSC
Sonata Software
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Pharmaceuticals and biotechnology
Hyderabad is the hub of the bulk-drugs industry, accounting for one-third of the national production of bulk drugs. The state produces a majority of 500 basic drugs produced in the country. The biotechnology market size of the sector in Andhra Pradesh in 2008-09 stood at US$ 475 million and accounted for 18 per cent of the total Indian biotechnology industry. The industry accounts for 43 per cent of the total biotech revenue generated by companies in south India (US$ 1,104 million). The State Government has helped develop the pharmaceutical and biotechnology industry through specific policies promoting knowledge-based cluster approach with financial incentives and appropriate infrastructure support. Presence of related educational infrastructure has also helped the industry. The biotechnology incubation centre was commissioned in late 2008.
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Key players

Dr Reddys Laboratories AMRI Natco Pharma Limited Divis Laboratories Aurobindo Pharma Nektar Anus Laboratories Limited Suven Life Sciences Limited Indigene Matrix Laboratories Limited Hetero Drugs Neuland Laboratories Glochem Industries Limited (GIL)
Shantha Biotechnics Vimta Labs Indian Immunologicals Limited (IIL) Parexel Bharat Biotech International Limited (BBIL) Biological E. Limited Novartis Krebs Biochemicals & Industries Limited (KBIL)
Pharmaceuticals and biotechnology company profiles (1/7)

Dr Reddys Laboratories Limited Established in 1984, Dr Reddys ranks among the top 15 generics players in the world. With revenue of US$ 958 million, it is the first pharmaceutical company in Asia-Pacific (outside Japan) to be listed on the New York Stock Exchange (NYSE). It has offices in 35 countries and operations in over 115 countries. Overseas business contributes around 86 per cent of the total revenue. Aspires to become a discoveryled global pharmaceutical company and one of the top 10 generic companies in the world. Present in the therapeutics category: anti-infectives, cardio-vascular (CVS), diabetes, dermatology, pain management, nutritional, dental, urological and oncology. AMRI research centre is located in Hyderabad in the ICICI Knowledge Park. Established in 2005, AMRI provides custom synthesis of scaffolds and building blocks, as well as preparation of reference standards. A second laboratory for preparing larger amounts of pharmaceutical intermediates, starting materials and other compounds is now operational as well. The Centre's operations are fully integrated with USbased resources. Natco has four manufacturing facilities and employs around 1,500 people. The company manufacturers formulations, bulk drug and parenterals. Natco is also a large contract manufacturers in India. The company has headquarters at Hyderabad. Revenue of the company in 2009-2010 was US$ 65 million.
Albany Molecular Research Inc (AMRI)
Natco Pharma Limited
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Divis Laboratories
Divis is a leading manufacturer of active pharmaceutical ingredients (API) with revenue of US$ 197 million in 2009-2010. The company has a state-of-the-art multi-purpose plant at Choutupal, in Nalgonda district, and a second plant at Visakhapatnam. The company is among the top 10 producers of naproxen in the world and 90 per cent of the products are being exported to several countries, including the US and Europe. Divis also exports dextrome thorphan, iopamidol, nabumetone, phenyle ephedrine and phen procumar. Aurobindo is one among the vertically integrated pharmaceutical companies in India with revenue of US$ 689 million in 2009-2010. It has a product portfolio spread over major product areas encompassing CVS, central nervous system (CNS), anti-retroviral, antibiotics, gastro-enterologics, anti-diabetics and anti-allergic with approved manufacturing facilities by the United States Food and Drug Administration (USFDA), UK Medicine and Healthcare products Regulatory Authority (UKMHRA), World Health Organisation (WHO), Medicine Control Council of South Africa (MCC-SA), ANVISA-Brazil for both APIs and formulations and has global presence with own infrastructure, strategic alliances, subsidiaries and joint ventures. Along with a registered corporate office at Hyderabad, it has overseas branch offices at Ghana, Ethiopia, the UK, Vietnam and Hong Kong. Nektar Therapeutics is a leading biopharmaceutical company developing a robust pipeline of novel therapeutics based on its advanced polymer conjugate chemistry technology platform. Nektar also partners with the top biopharmaceutical companies to bring new products to market. To date, Nektar's technology and drug development expertise have enabled nine approved products for partners, which include leading biopharmaceutical companies. Headquartered in the US, Nektar's R&D facility is located in Secunderabad, Andhra Pradesh.
Aurobindo Pharma
Nektar
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Anus Laboratories Limited Anu's Laboratories Limited, an ISO 9001:2000 certified company was established in 1996. The company is engaged in manufacturing of quality drug intermediates to meet the needs of international customers. The optimised process of 2,4-Dichloro-5 fluoro-acetophenone has enabled the brand to establish itself as the flagship product of the organisation. The products is available to its wide customer-base as a competitive product of the highest quality. Other high quality intermediates such as chlorohexanone, 1,3-dibromo propane are also manufactured by the company along with methyl-4 (4-chloro 1-oxo butyl) a, a di-methyl acetate. It has a state-of-the-art research and development facility, located at Balanagar, Hyderabad, which supports product development, contract research and customised synthesis programmes of the organisation.
Suven Life Sciences Limited
The company develops and supplies pharmaceutical and agro-chemical intermediates for New Chemical Entities (NCEs) and APIs. In 2009-2010, total revenue of the company was US$ 27 million. The company's manufacturing facilities include fine chemicals, pyrimidines, purines, imidazoles, indoles and specialty intermediates. Suven's main thrust is in Contract Research And Manufacturing Services (CRAMS) and the company is serving as many as 22 global life sciences and fine chemical companies. Suven Life Sciences USA LLC, its wholly owned subsidiary, recently acquired the assets of the New Jersey-based Synthon Chiragenics Corporation, the global player in carbohydrate- based Chiral technology for pharmaceuticals. Indigene Pharmaceuticals is a biopharmaceutical company focused on designing, developing, and delivering prescription and consumer healthcare products. The company has offices in the US, Hyderabad, Canada and Switzerland.
Indigene
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Matrix Laboratories Limited
Matrix has a USFDA-approved facility located at Hyderabad, and has a strong presence in central-nervous-system drugs, quinolone anti-bacterials, anti-retrovirals and anti-histamines. Focusing , mainly, on synthetic research and process development, Matrix has six laboratories with a team of 70 scientists. The company's major customer spread is across 80 countries. In 2009-2010 total revenue of the company was US$ 317 million. It has three API facilities at Hyderabad and one at Visakhapatnam. In January 2007, Mylan Inc of the US acquired controlling stake in the company, following which Matrix has now become a subsidiary of Mylan. Headquartered in Hyderabad, Hetero Drugs made a mark being the first in Andhra Pradesh to produce all the anti-retrovirals: indinavir sulphate, nelfnavir, efavirenz, lopinavir, ritonavir, lamivudine, zidovudine , stavudine and abscavir sulphate. The company markets its products to over 50 countries and, recently, penetrated the regulated markets in US, Canada and Europe. In 2005, it was awarded a licence to make generic oseltamivir, Tamiflu. The Swiss firm, Roche, licensed it to make a generic version of the drug. Hetero Drugs is the parent company in the Hetero group of companies and other companies which are part of the group are Hetero Labs, Hetero Research Foundation, Symed Labs Limited, Cirex Laboratories, Genx Laboratories and also foreign subsidiaries such as Invagen Inc, in USA and Richmond Labs in Argentina, etc. Also, now, Hetero has its own retail chain of pharmacy outlets in India named, Hetero Pharmacy.
Hetero Drugs
68

Neuland Laboratories Neuland has two world-class manufacturing facilities on the outskirts of Hyderabad. The company claims to be the largest manufacturer of albuterol sulfate in the world with USFDA approval and Certificate of Suitability from the European Department for the Quality of Medicines, Council of Europe. It has also a US FDA approved manufacturing facility for ranitidine HCl Form1, ciprofloaxcin and latnoprost. The company exports to over 65 countries worldwide, including USA, Canada, Europe, Latin America, Korea, Japan, Australia and South Africa. In 2009-2010 revenue of the company was US$ 59 million Glochem is a public limited company manufacturing bulk drugs, drug intermediates and specialty chemicals. GIL has tie-ups with companies in India and abroad, including the US and Europe, for contract manufacturing and custom synthesis. GIL has been developing, manufacturing and delivering tailor-made fine chemicals and intermediates for the leading pharmaceutical and fine chemical companies on exclusive basis. It is based in Hyderabad. A pioneer in the field of biotechnology, Shantha Biotechnics is the first Indian company to develop, manufacture and market a recombinant human healthcare product in India. Shantha is currently focused on developing generic biologicals, novel therapeutic antibodies, proteins and vaccines. It has also started exploratory research in the fields of oncology, infectious diseases and platform technologies. SHANVAC- B is the first Indian Hepatitis-B vaccine to pre-qualify for WHO approved supply to UN agencies, globally. Today, Shantha caters to major international markets including AsiaPacific, Africa, Commonwealth of Independent States (CIS) and Latin America in addition to the United Nations Childrens Fund (UNICEF) and Pan American Health Organisation (PAHO). Based in Hyderabad, Shantha Biotech became a part of the Sanofi-Aventis group in July 2009.
Glochem Industries Limited (GIL)
Shantha Biotechnics
69

Vimta Labs Vimta Labs is Indias leading contract research and testing organisation. Established in 1984, Vimta now serves several market leaders across the globe. The company has a team of 707 professionals comprising 442 scientists in various disciplines such as chemistry, pharmacy, medicine, microbiology, molecular biology and informatics. The team is slated to double in next three years. VIMTA is a multisite organisation with more than 300,000 sq ft world-class laboratory facilities. Its facilities in Andhra Pradesh include a life sciences campus and central laboratory at Hyderabad along with Clinical Laboratories at Visakhapatnam. IIL produces a range of veterinary vaccines such as foot -and -mouth disease (FMD) vaccine, antirabies vaccine, bacterial vaccines, canine vaccines and a host of other combined vaccines. IIL's range of human vaccines comprises of rabies, Hepatitis B, measles, MMR and DPT. It has one of the leading research and development centres in India. The company has headquarters and manufacturing facilities in Hyderabad, an institute in Ooty and an overseas office in Vietnam. Over the past 25 years, PAREXEL has developed significant expertise to assist clients in the worldwide pharmaceutical, biotechnology and medical device industries with the development and launch of their products in order to bring safe and effective treatments to the global marketplace for the patients who need them. Headquartered near Boston, Massachusetts, PAREXEL operates in 69 locations throughout 52 countries around the world, and has approximately 9,000 employees. It has offices located at Hyderabad and Bengaluru and offers contract services in clinical evaluation through to commercialisation and medical marketing to device industries. BBIL is a multidimensional biotechnology company specialising in product-oriented research, development and manufacturing of vaccines and bio-therapeutics. BBIL's state-of-the-art manufacturing plant is the largest of its kind in Asia-Pacific. The first bio-pharma facility in the country to be audited and approved by the Korean Food & Drugs Administration (KFDA), it is located at the Genome Valley, Hyderabad. Built with an investment of over US$ 22 million , the facility's manufacturing, control procedures and protocols, conform to the stringent standards laid down by internationally recognised institutions such as USFDA and WHO.
Indian Immunologicals Limited (IIL)
PAREXEL
Bharat Biotech International Limited (BBIL)
70

Biological E. Limited
Biological E. manufactures sera and vaccines, oncology drugs, cardio-vascular, bulk drugs, formulations and herbal products. The company has established alliances with world-renowned pharma companies such as Evans Medical of the UK, Solvay & Cie of Belgium (veterinary products), Pasteur Meraux Connaught of France (sera and vaccines) and ICI, an exclusive marketing tie-up for animal health products. Biological E. Limited has several firsts to its credit. It was the first pharmaceutical company to manufacture anti-TB drugs in India and the first private sector vaccine manufacturer in the country. The company is investing approximately US$ 50 million towards the development and expansion of infrastructure. State-of-the-art equipment is being installed in all locations to meet the US FDA and European MEA standards in manufacturing, quality control and pre-clinical activities. Another project underway is the modern biotech facility, with an investment of US$ 21.7 million at the Genome Valley. Novartis has presence in over 140 countries and employs 97,000 people. Has been present in India for the last 60 years in healthcare sector. Setting up its healthcare-related IT/ITeS and R&D facility in Hyderabad. The company has a development centre at Hyderabad which integrates development franchises of the company though information technology. The facility also operates as a global centre for marketing and sales, sourcing, business planning and analysis. In 2009-2010, the company earned revenue of US$ 131 million. KBIL was established in the year 1991 as a public limited company with the objective of establishing commercially viable biotech processes with applications in medicine and agriculture industries. The company has pioneered in fermentation technology over the last decade. KBIL manufacturing Unit-I is located at Regadichelika village of the Nellore district. Products manufactured from Unit-I facility are ephedrine, pseudoephedrine and their salts, which are used for making formulations for respiratory ailments, viz., cough and cold .
Novartis
Krebs Biochemicals & Indisutries Limited (KBIL)
71
Apparel and textiles
The state is a leading producer of cotton, with a production of about 3.46 million tonnes in 2008-09. Medium grade and superior long staple varieties of cotton are predominantly grown in the state.
The State Government has identified textile sector as one of the long term growth engines. To utilise potential of the sector, the State Government has already established five apparel export parks (AEP) and seven textile parks. It proposes to establish another 15 AEPs in the state.
There are over 80 spinning mills including a number of 100 per cent export-oriented units with state-ofthe-art machinery, producing cotton, synthetic and blended yarns. There are 1,079 weaving units with a production capacity of 789 million metres of fabric per annum. The state has, moreover, emerged as a large textile processing centre. Over 100 units are set up in the state with a processing capacity of 13 million metres of cloth per annum. The number of power looms in the state aggregates to around 44,000 employing approximately 1,10,000 workers. Apparels, fabrics and furnishings have been identified as potential products by the state. It aims to achieve, annually, US$ 6 billion in textiles exports, and US$ 2 billion in handloom exports by 2010. The state aims to increase its domestic contributions for apparels and textile products to US$ 4.87 billion. The domestic sales of the state are expected to be around US$ 3 billion per annum by 2010.
72
Agri and processed food sector
During March, 2005 and March 2010, the agricultural sector in the state witnessed a growth of 14.1 per cent and the total crop area increased to 12.2 million hectares by 2008-09. A variety of agro-climatic conditions in the state make it conducive for growing a variety of horticulture crops such as fruits, vegetables, spices, tuber crops, plantation crops and floriculture. The state is one of the large producer of rice in India. It is a leading producer of cash crops such as tobacco, groundnut, dry chilly, turmeric, oilseeds, cotton, sugar and jute. The state is one of the largest producers of horticulture products in India, production is expected to reach 22.9 million tonnes by 2020. The state produces some of the finest varieties of mangoes, grapes, guavas, papayas and bananas. It is the number one producer of sweet lime, lime, papaya, chilly, turmeric and palm oil. To achieve the growth envisaged for the agricultural sector, the state aims to attract investments of around US$ 17.07 billion by 2010, with the total investment until 2020 targeted at around US$ 39.02 billion.
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Key players CongAgra Foods Cargill ITC APDDCF Ushodaya Enterprises Kraft foods
Agri and processed food sector company profiles (1/2)

CongAgra Foods ConAgra Foods, US is one of the worlds leading food companies. It has partnered with ITC Agro and established an R&D centre to adapt food technologies to Indian conditions. The company is now a US$ 320 million entity with a dominant market position in the edible oils and branded foods sectors. Edible oil brands include Sundrop, Healthy World, ACT II and Rath. Agro Tech Foods Limited, an affiliate of ConAgra Foods have their registered office at Hyderabad. Cargill maintains a number of businesses in India, with operations including the handling and processing of a wide range of products, including refined oils, grain and oilseeds, sugar, cotton and animal feed. In addition, Cargills presence in India has been growing since it began a joint venture operation in 1987. In 2006, Cargill entered into a joint venture and subsequently owned a leading shrimp feed manufacturing farm in Rajahmundry. It has also entered a joint venture project to set up a sugar refinery in the state. ITC is a large Indian business conglomerate with diverse business interests including agri-foods, paper, fast moving consumer goods, lifestyle and retailing and hotels. In 2009-2010, total revenue of the company was US$ 5.5 billion. A substantial part of ITCs agri-business is located in Andhra Pradesh. The company has one unit each at Anaparti and Chirala and a research centre in Rajamundhry. The company also runs its innovative internet based e-choupal initiative in the state for the benefit of the farmers.
Cargill
ITC
74
Agri and processed food sector company profiles (2/2)

Andhra Pradesh Dairy Development Cooperative Federation (APDDCF) APDDCF runs 12 dairy plants and manufactures milk products under the Vijaya brand name. These plants together have a capacity of 2,437 litres per day. Products include butter, UHT milk, milk powder, ghee, flavoured milk, khoa, kulfi and processed cheese. It is one of the 15 dairy cooperatives operating under the National Dairy Development Board (NDDB). Established in 1980, the company manufactures products such as pickles, fruit and vegetable purees, instant food mixes, etc., under the well known brand name Priya. Headquartered in Hyderabad, the Ramoji group company uses technology and is actively involved in research and development of food products. Multinational branded food and beverages company, Kraft Foods, established a soft drink manufacturing plant in Andhra Pradesh in 2001 and is currently working on a new agronomy project.
Ushodaya Enterprises
Kraftfoods
75
Agriculture and allied industry (1/2)

Forestry
Fisheries
Andhra Pradesh has 6.21 million hectares of forest area, which accounts for 22.6 per cent of the total geographical area of the state. In 2009-2010, contribution of forestry to the GSDP was estimated at US$ 441 million.
The fisheries sector has been identified as one of the six growth engines in agriculture sector under, Vision-2020 of the state. Among Indian states, Andhra Pradesh is one of the largest producer of brackish-water shrimp and fresh-water prawn production. In 2008-09, total production of fish in the state was 1.25 million tonnes compared to 1.05 million tonnes a year ago. Production of fish comprised of around 960,000 tonnes of inland fish (including fresh water prawn & brackish water shrimp) and around 290,000 tonnes of marine fish. The contribution of fisheries to GSDP in 2009-2010 was estimated to be US$ 2.4 billion, over 25 per cent increase over 2008-09 . The Andhra Pradesh Government has entered into an agreement with the US-based World Tuna Development International (WTDI) to develop tuna fishery in the Bay of Bengal. The State Government will invest US$ two million towards 51 per cent of the equity in the proposed joint venture company named as Andhra Pradesh Marine Fisheries Development Limited (APMFD) while WTDI will invest the remainder. The balance US$ 11.5 million will be taken as term loans from banks.
Sources: Commodities Bureau Agriculture action plan 2009-2010, Department of Agriculture website, http://agri.ap.nic.in, Andhra Pradesh economy in brief 2008, APDES website, www.apdes.ap.gov.in, news publications, Socio Economic Survey 2009-2010.
76
Agriculture and allied industry (2/2)
Animal husbandry is rapidly expanding in the state and is playing a significant role in improving the rural economy. This sector provides gainful employment to a large number of small and marginal farmers and agricultural labourers and enhance their economic status. Activities of the animal husbandry department have been oriented towards improving health of livestock and increased production of milk, eggs and meat. As of March 2010, the state had 5,083 institutes supporting production in the animal husbandry sector and 5,320 institutes for health of livestock.
Product Milk (million tonnes) Egg (in million) Meat (million tonnes)
Production (2008-09) 9.6 18,344 0.6
Production (2007-08) 8.9 17,588 0.55
Sources: Socio Economic Survey of Andhra Pradesh, 2009-2010.
77
Petroleum, chemicals and petrochemicals
According to the Ministry of Petroleum and Natural Gas, for 2008-09, the net natural gas production was about 1,524 million cu m. The states Krishna-Godavari basin area has a total hydrocarbon resource base of 1,130 million metric tonnes. Andhra Pradesh is set to become the second Indian state after Gujarat to enter the oil and gas exploration and production segment through bids for oil and gas blocks under the Central Governments New Exploration Licensing Policy (NELP). The Andhra Pradesh Government decided to enter the oil and gas exploration and development sector and set up a special purpose vehicle (SPV), the Andhra Pradesh Gas Infrastructure Corp Limited as a joint venture between two state-owned entities. The infrastructure provider for industries in the state, APIIC, would hold 51 per cent in the SPV and AP Genco, would hold the balance. Hindustan Petroleum Corporations Visakhapatnam plant has expanded its refined crude throughput from the existing 7.57 million tonnes in 2005-06 to 8.79 million tonnes in 2009-2010. In October 2009, the Department of Petroleum, Government of India, signed a memorandum of understanding with the Andhra Pradesh Government for setting up a petroleum, chemicals and petrochemicals investment region (PCPIR) in the Visakhapatnam-Kakinada region as an industrial cluster. The investments expected in the PCPIR are estimated to be around US$ 74.6 billion. The State Government has initiated process of appointing consultant for preparing master plan for the project.
78
Tourism
Arrival of international tourist in Andhra Pradesh (in 000)
Andhra Pradesh is known for its pristine beaches, sacred places of worship, lush green forests, spicy cuisine and hospitable people. With tourist attractions such as Charminar, Golconda Fort, and Ramoji Film City, Araku Valley, Borra Caves, Tirupati Balaji Temple, and Puttaparthi Saibaba, the state offers attractive investment opportunities to developers and investors.
1000 800 600 400 200 0 2007 2008 2009 770 789 795
The state ranked seventh in international tourist arrivals and accounted for 5.8 per cent of the total international tourist arrivals in India in 2009. With 24.2 per cent share of domestic travelers, the state ranked first in domestic tourist arrivals.
Nine projects have been sanctioned for the state by the Ministry of Tourism during 2008-09, at a project outlay of US$ 21 million. The State Government has identified Hyderabad, Visakhapatnam,Tirupati,Vijayawada, Nagarjunasagar and Warangal for tourism development.
Arrival of domestic tourist in Andhra Pradesh (in million)

180 160 140 120 100 80 60 40 20 0 2007 2008 2009 Source: Ministry of Tourism, Government of India 127.9 132.7 157.5
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Tourism upcoming mega projects

Kadapa heritage circuit Tirupati heritage circuit Charminar area Mega park near Nagarjuna Sagar
Sources: Directorate of Tourism and Directorate of Economics and Statistics, Andhra Pradesh.
80
Leather
The state is a major producer of hides and skins, producing about 19 million pieces per annum, constituting around 10 per cent of the countrys output. The 34 large and medium tanneries in the state produce about 40 million sq ft of processed hides and skins per annum. The state has15 leather goods and footwear manufacturing units in the large- and medium-scale sector. The Government provides financial assistance in the form of investment grants to the extent of 30 per cent of cost of plant and machinery for SSI and 20 per cent of cost of plant and machinery for other units, subject to a ceiling of US$ 120,000 for technology up-gradation or/and expansion.
Leather Industries Development Corporation (LIDCAP) LIDCAP is the nodal agency for leather industry development in the state. Plans to establish71 mini-industrial parks on 25 acres of land for processing raw material, 16 medium industrial parks of 100 acres each for processing semi-finished leather, six mega industrial parks of more than 300 acres each including an international leather complex at Krishnapatnam (KILC). KILC is a world class infrastructure for leather tanning and leather processing. The project finance is supported by the Government of India, Government of Andhra Pradesh and has private participation in the SPV. KILC is located at Krishnapatnam in the Nellore district in an area of 412 acres near the sea coast. It is proposed that KILC will house about 25 tanning units in a floor area of 250 acres of land and about 21 leather processing units with capacities ranging between six and 25 tonnes and a total capacity of 300 tonnes in a floor area of 220 acres.
Source: Leather sector in AP, ILC profile, LIDCAP website, www.lidcap.org
81
Mines and minerals
The states mineral production was valued at US$ 2.7 billion in 2009-10.
Contribution to national minerals resources (%) in the country Barytes Ball clay Corundum Diamond Calcite Mica Garnet Limestone 94 63 61 40 39 28 26 20
According to Ministry of Mines, in 2008-09, Andhra Pradesh is estimated to account for approximately 12.4 per cent to total mineral production in the country.
Coal is the major mineral produced in the state which contributed 29.5 per cent of the total value of mineral production in the state. Production in iron ore increased by eight per cent, while that of manganese ore by 31 per cent and petroleum (crude) by 3.2 per cent in 2008-09. Production of silica sand increased by 49 per cent, ochre by 11 per cent, quartzite by 60 per cent, dolomite by 16 per cent, limestone by 16 per cent and coal 11 per cent in 2008-09.
Sources: Indian mineral scenario - states, Ministry of Mines website, www.mines.nic.in
82
Gems and jewellery
Hyderabad is one of the leading hubs for the jewellery sector in India. The state produces a wide array of precious- and semi- gems as well as pearls. The AP Gems and Jewellery Park has been developed on an area of 2.5 acres in Hyderabad with an investment of around US$ 12.68 to US$ 13.90 million. The park is a joint venture between the Phoenix Group, IOI Corporation and AP State Trading Corporation. It has been developed as a state-of-the-art facility in which the floor space will be sold to jewellers and pearl dealers.
Hyderabad Gems SEZ Limited (HGSEZ) Situated at Hardware Park near the upcoming international airport. SEZ to be set up at a cost of about US$ 121.95 million. The 200-acre park will house more than 75 diamond, gold and watch manufacturing units and will generate 50,000 new jobs. An international trade centre, a world class convention centre, plus an exhibition area will also be a part of the SEZ. It is the first jewellery park to have an integrated manufacturing and trading facility.
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Other growth sectors (1/2)

Hospitality and entertainment
Leisure and entertainment
Being a major tourist hub in the country, the state is making rapid strides in the retail and entertainment segment. To attract new investments in the sector, the Government offers various incentives including an investment subsidy of 20 per cent of the project cost, subject to a maximum of US$ 50,000. To encourage up-gradation to international standards, selected hotels will be offered an incentive of 15 per cent of the project cost.
The sector is attracting investments in projects such as world -class spas, entertainment centres, mega shopping malls, multiplexes, business convention centres and theme parks. Urban entertainment, including amusement parks, has redefined leisure and entertainment activities in the city.
Hotel projects under construction Name Park Hyatt 7-Star hotel Leela Palace Kempinsky hotel
Source: www.projectstoday.com
Promoters Gayatri Hi-Tech Hotels Limited Hotel Leelaventure Limited
Project cost (US$ million) 76.1 67.4
Location Banjara Hills, Hyderabad Hyderabad
84
Other growth sectors (2/2)

Retail
Electronics hardware
Semiconductors
Organised retail is catching up fast with significant mall development in the pipeline. Shopping malls are being developed in suburban and peripheral areas followed by central business district. Reliance Retail opened its first 'Reliance Fresh' stores in Hyderabad and Secunderabad in late 2006. Reebok has opened its largest store in the world in Hyderabad. GVK group opened GVK one a world-class shopping space measuring 6,25,000 sq . ft in May 2009. GVK one also hosts a 1,200-seat INOX multiplex along with a themed entertainment centre Funzone.
Key segments within the electronics hardware industries in the state: Telecommunications Industrial electronics Test and measuring equipment Computer and consumer electronics Strategic electronics There is immense scope for investments in the fields of nanotechnology, semiconductors, computer peripherals, appliances, precision engineering, integrated circuits, large scale integration chips (LSICs) and very large scale integration chips (VLSICs).
An investment of US$ 3 billion has been announced for setting up a fabrication unit in the Fab City, Hyderabad. Fab City has been allotted 1,200 acres, close to the new international airport. The Electronics Hardware Policy of the state offers various incentives such as exemptions, reimbursements, facilitating technical education, etc. to promote the industry.
Sources: News publications, "Urban infrastructure", GVK group website, www.gvk.com
85
Major industrial projects being implemented

Project Pranahita-Chevella lift irrigation scheme Krishnapatnam ultra-mega power project Krishnapatnam power project (1,600 MW) Integrated steel project, Phase-I Galeru Nagari Sujala Sravanthi irrigation project Solar energy equipment project (120 MW) Diesel hydro treater project - Visakh Refinery Polavaram irrigation project Greater Hyderabad growth corridor project Godavari drinking water supply scheme Finished steel project Sector Irrigation Power Power Steel Irrigation Promoter Government of Andhra Pradesh Coastal Andhra Power Limited AP Genco Bramhani Industries Limited Government of Andhra Pradesh Investment (US$ million) 8,369.6 3,695.7 1,813.0 978.3 3,635.0 Location Bejjur, Adilabad Krishnapatnam, Nellore Nellore Cuddapah Cuddapah, Nellore, Chittoor
Power Refinery Irrigation Roads Water supply Steel
X L Telecom Limited Hindustan Petroleum Corporation Limited (HPCL) Government of Andhra Pradesh Hyderabad Growth Corridor Limited Hyderabad Metro Water Supply & Sewerage Board Rashtriya Ispat Nigam Limited
782.61 782.0 658.7 652.2 652.2 652.2
Shamsabad, Hyderabad
Visakhapatnam West Godavari Medak, Ranga Reddy Visakhapatnam
86
Key industrial projects being planned

Project Hyderabad elevated-MRTS project Kakinada refinery project Bhavanapadu coal-based power project Alumina refinery project Multi-product Industrial Park Alumina refinery project Sector Transport Refinery Power Aluminium Industrial park Aluminium Power Construction Roads Power Promoter Hyderabad Metro Rail Limited Investment (US$ million) 2,637.4 3,260.9 2,407.6 1,956.5 1,652.2 1,521.7 Location Hyderabad Kakinada, East Godavari Srikakulam Boddavara Perupalem Hindupur Hyderabad Multiple locations Warangal
Kakinada Refinery & Petrochemicals Limited

East Coast Energy Private Limited Jindal South West Aluminium Limited Yeswanth Industrial Infrastructure Projects Private Limited National Aluminium Co Limited Sheshadri Power & Infrastructure Private Limited CBD Tower Private Limited National Highways Authority of India AP Genco
Coal-based power project

Business complex Road up-gradation (IcchapuramSrikakulam-Ankapalli-Rajahmundary) project Kakatiya power project, Stage-II
1,521.7
1,521.7
771.7
645.4
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Contents
88
DOING BUSINESS IN ANDHRA PRADESH Andhra Pradesh November 2010
Key approvals required (1/2)

S No 1 2 Approvals and clearances required Registration, IEM, Industrial licenses Allotment of land/shed in industrial estates or industrial areas Acquisition and alienation of government lands Respective departments of state Registrar of firms Andhra Pradesh Industrial Development Corporation Chief Commissioner of Land Administration (CCLA) Panchayat Raj Department 4 Site and building plan approval Urban Development Authority Town and Country Planning Municipality Urban Development Authority 5 Change of land use Consent for establishment under pollution control Green Town and Country Planning Municipality 7 days AP Pollution Control Board 45 days 7 days Estimated time 7 days
7 days for up to 1,000 sq m 21 days for above 1,000 sq m 45 days
Orange
Red
21 days
45 days
Source: Commissionerate of Industries, Government of Andhra Pradesh
89
Key approvals required (2/2)

S No Approvals and clearances required Respective departments of state Estimated time
Consent for
7 8 9 10 11 12 13 14 15 16 17 operation under pollution control Excise registration
Green
Orange Red Fire Services Department Excise Department Commercial Taxes Department Power distribution companies Factories Department Hyderabad Metro Water Supply and Sewerage Board Irrigation Department AP Pollution Control Board
7 days
21 days 45 days 15 days 14 days 7 days 7 days 23 days 7 days 7 days 7 days 23 days 30 days
No-objection certificate for fire safety VAT/CST Registration Power feasibility Power connection Approval of factory plans Factory license Sanction of water supply Water connection Permission to draw water from rivers and/or public tanks
Source: Commissionerate of Industries, Government of Andhra Pradesh
90
Cost of doing business in Andhra Pradesh

Parameter Land price (US$ per sq m) Labour (US$ per man year) Lease rent (US cents per sq ft) Electricity (US cents per unit) Residential rent (US cents per sq ft per month) Five-star hotel room (US$ per night) Water (US cents per 1,000 litres)
Sources: Andhra Pradesh Government websites and industry sources
Cost 20 to 200 825 to1,250 36.6 to 61.0 Commercial: 15.8 Industrial: 9.8 to10.8 12.6 to 62.5 73.0 to 512.0 Commercial: 50.0 Industrial: 62.5
91
Single-window approval mechanism
Andhra Pradesh is the first state in the country to have enacted the Industrial Single Window Clearance Act No 17 of 2002. The Act made it compulsory for new industries to register with the single-window to obtain clearances quickly. It also simplified procedures for getting industrial clearances. Committees were constituted at district and state levels to communicate to the applicant, the status of their clearances. It has set time slots for issuing clearances and incorporated a provision for deemed approval after the expiry of time limit. District level committees can clear investments not exceeding US$ 1,054,852. State level committees can clear those exceeding US$ 1,054,852. Above the district and state level committees is an empowered committee headed by the Chief Secretary of the State Government who reviews and monitors disposal of applications. Overall, a State Board under the chairmanship of the Chief Minister oversees the progress of the scheme. The maximum time taken to issue clearance of applications at all stages is 45 days.Violation of provisions of the Act made either through self-assessment or otherwise would invite a penalty of US$ 108 in the first instance and US$ 217 in the second instance.
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Key investment promotion offices (1/2)

State Investment Promotion Board (SIPB) The SIPB has been created by the Government of Andhra Pradesh with the state Chief Minister as Chairman and members consisting of the Finance Minister , Minister for Revenue, Minister for Major Industries, Minister for Energy, and other ministers connected with specific projects as special invitees as well as the Chief Secretary to Government as member or convener. The SIPB meets once a month to make final decisions regarding investments and promotion of industries in Andhra Pradesh and for approval of the projects. The project proposals and other issues regarding investments and promotion of industries in Andhra Pradesh are processed by the Industries & Commerce Department and submitted to the Board. The Industries & Commerce Department also circulates the project proposals, with detailed notes, to all the concerned departments, for their action. The detailed note along with the reaction of the concerned departments are presented and discussed in the meeting of the Board, before taking a final decision. It is ensured that all final and necessary decisions are given for the industrial projects within a period of four weeks. The Industries & Commerce Department issues a single order on each project, incorporating the decisions of the Board. The concerned Departments of Secretariat issue further necessary orders, with which they are concerned, on the decisions taken by the SIPB. Major Industries, Commerce and Export promotion Ministry

Controls the office of the Principal Secretary, Industries & Commerce, Commissioner of Industrial Promotion They are responsible for SSIs and control the office of the Commissioner of Industries & Export Promotion, Commissioner Handlooms and Textiles, Commissioner for Sugar and Director, Mines and Geology. The Industries & Commerce department is headed by the Industries Minister and is controlled by the Principal Secretary.
93
Key investment promotion offices (2/2)

Corporations under Industries and Commerce Department Andhra Pradesh Industrial Development Corporation (APIDC) Andhra Pradesh Industrial Infrastructure Corporation (APIIC) Andhra Pradesh Mineral Development Corporation (APMDC) Andhra Pradesh State Finance Corporation (APSFC) Andhra Pradesh State Trading Corporation (APSTC) Andhra Pradesh State Handloom Weavers Co-operative Society Limited (APCO)
Leather Industries Development Corporation of Andhra Pradesh (LIDCAP)

Andhra Pradesh Handicrafts Development Corporation (APHDC) Andhra Pradesh Khadi & Village Industries Board (KVIB)
94
Contact list
Key agency Contact Information 6th Floor, Parisrama Bhavan Fateh Maidan Road, Basheerbagh Hyderabad - 500 004 Phone: 91-40-2323 7622, 2321 2798 Fax: 91-40-2323 3393, 2323 3251 E-mail: apiic@hyd.sancharnet.in Website: www.apiic.in Industries and Commerce Department 2nd Floor, D Block, Room No-348A Secretariat Hyderabad - 500022 Phone: 91-040-23454449 Fax: 91-040-23452985 E-mail: secy_inds@ap.gov.in Website: www.industriesportal.apcgg.gov.in
AP Industrial Infrastructure Corporation
Department of Industries and Commerce
95
Annexure
Exchange rates Year 2000 2001 2002 INR equivalent of one US$ 46.6 48.3 48.0
2003
2004 2005 2006 2007
45.6
43.7 45.2 45.0 42.0
2008
2009 2010
Averages for the year
40.2
46.0 47.4
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ANDHRA PRADESH
November 2010
DISCLAIMER
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Andhra Pradesh Tourism

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Andhra Pradesh Tourism

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ANDHRA PRADESH

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

Investment climate of a state

Regulatory framework Physical and social infrastructure

ADVANTAGE ANDHRA PRADESH Andhra Pradesh November 2010

Andhra Pradesh State Profile

ADVANTAGE ANDHRA PRADESH Andhra Pradesh November 2010

Advantage Andhra Pradesh (1/2)

Policy and fiscal incentives

Rich labour pool

ADVANTAGE ANDHRA PRADESH Andhra Pradesh November 2010

Advantage Andhra Pradesh (2/2)

High economic growth

Stable political environment

ADVANTAGE ANDHRA PRADESH Andhra Pradesh November 2010

Andhra Pradesh in figures (1/2)

GSM cellular subscribers (No)

ADVANTAGE ANDHRA PRADESH Andhra Pradesh November 2010

Andhra Pradesh in figures (2/2)

Ease of doing business

PPP: public private partnership, SEZ: special economic zone

Parameter Policy support Sectors with specific policies Availability of labour

Andhra Pradesh Government

ADVANTAGE ANDHRA PRADESH Andhra Pradesh November 2010

Key industries with policy thrust and factor advantages

Medium *Factor advantage

STATE ECONOMY AND SOCIO-ECONOMIC PROFILE Andhra Pradesh November 2010

Socio-economic snapshot of Andhra Pradesh

STATE ECONOMY AND SOCIO-ECONOMIC PROFILE Andhra Pradesh November 2010

Andhra Pradeshs GSDP

STATE ECONOMY AND SOCIO-ECONOMIC PROFILE Andhra Pradesh November 2010

Andhra Pradeshs NSDP

STATE ECONOMY AND SOCIO-ECONOMIC PROFILE Andhra Pradesh November 2010

The tertiary sector has an increasing share in Andhra Pradeshs economy

STATE ECONOMY AND SOCIO-ECONOMIC PROFILE Andhra Pradesh November 2010

Per capita GSDP

STATE ECONOMY AND SOCIO-ECONOMIC PROFILE Andhra Pradesh November 2010

Industries in Andhra Pradesh

Key industries in Andhra Pradesh

Agro and food-based industry

STATE ECONOMY AND SOCIO-ECONOMIC PROFILE Andhra Pradesh November 2010

Crop Sugarcane Rice

Maize Cotton Pulses Groundnut

Chilly Onion Jowar Greengram Mesta*

STATE ECONOMY AND SOCIO-ECONOMIC PROFILE Andhra Pradesh November 2010

Andhra Pradeshs exports trends

Annual exports growth trends (%)

Source: Capital Markets

Sales tax exemption on purchase of raw materials.

STATE ECONOMY AND SOCIO-ECONOMIC PROFILE Andhra Pradesh November 2010

Investments and FDI inflows

Break up of investments by sectors as of March 2010

Manufacturing Mining Electricity Services^

16.5% 31.8% 23.8%

^Excluding financial services Source: CMIE

INFRASTRUCTURE STATUS Andhra Pradesh November 2010

Source: Maps of India

INFRASTRUCTURE STATUS Andhra Pradesh November 2010

Railway network (1/2)

Vijaywada Guntakal Guntur

Hyderabad Nanded Total

INFRASTRUCTURE STATUS Andhra Pradesh November 2010

Railway network (2/2)