 "Odisha to set aside legacy of failed mega projects, tap emerging sectors")
Two of the biggest investments in Odisha — mega steel mills proposed by Posco and ArcelorMittal, which together had committed Rs 1 lakh crore in the state, did not take off. But, the state is gearing up to overcome the baggage of these failed big-ticket projects and script a new investment story propelled by human resource rather than natural resource.
Experts reached a consensus on moving beyond the failed showpiece investments at the Business Standard Round Table-2016 here on Wednesday.
“The time has come to look forward. We have to look at a variety of sectors — opportunities thrown up by food processing, especially marine processing and apparel manufacturing, rather than looking back at the opportunities lost. In our state, we hardly do any value addition whereas a country like Vietnam takes marine products from us, adds value and exports to countries like Japan and Korea at 10 times the valuation. Also, we can tap apparel manufacturing since a lot of Odia workers are engaged in this sector in Bengaluru and Tirupur. They would like to come back if we can create the opportunities,” said Odisha chief secretary Aditya Padhi at the inaugural session titled ‘Attracting Investments: Challenges and Opportunities’.
According to him, Odisha is constantly reinventing itself with the state’s focus shifting from natural resource to human resource. “We would like to capitalise on the demographic dividend.”
T K Chand, chairman of National Aluminium Company (Nalco), said: “Both the Posco and ArcelorMittal projects have been blown out of proportions. People did not realise it was the timing that led to project withdrawals when there was a global downturn.”
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Commenting on the failed projects of Posco and ArcelorMittal, Subroto Bagchi, chairman, Odisha Skill Development Authority, said: “We tend to be defensive about the past. The time has come not to be defensive. When things happen, they happen and if they don’t, they don’t happen.”
Bagchi said Odisha has been caught in an image warp and there was a need to break this stereotype.
“There is an emotional infrastructure of the past. We need a new breed of thinking. We want to be viewed as a state rooted in the past and nested in the future. We want Odisha to be a sandbox for innovation. There has to be a coming together of both reason and season.”
He cited Tirupur’s example where about 10,000 Odia girls are apparel makers. Tirupur has set itself an export target of Rs 100,000 crore by 2020 and most of the companies there have annual turnover of only Rs 200 crore.
Odisha industries minister Debi Prasad Mishra said Odisha could build on its inherent strengths in apparel making. “The state government has pronounced a dedicated policy for handloom and apparel and also for other sectors such as electronics, information technology, tourism and biotechnology. We have moved away from the practice of signing MoUs (memoranda of understanding).”
The minister said the state government’s focus was on rapid reforms to speed up implementation of the investment intents.
The chief secretary conceded that Odisha wasn’t great in terms of conversion of investment intentions, but it wasn’t bad either. “Nationwide, the average conversion rate is 15 per cent and we are well within this figure,” he said.
The participating speakers also agreed on the need to expand investment basket, exploiting opportunities offered by emerging sectors.
P K Jena, electronics and IT secretary, said: “We are focusing on quality investments. At the recent ‘Make in Odisha’ conclave, we got excellent queries from a lot of companies on electronics manufacturing.”
Sanjeev Chopra, principal secretary (industries), said: “We have received investments worth Rs 34,000 crore in six focus sectors. This is not a mean amount as we have not marketed them as we should have done in the past. The state has also seen an unprecedented interest in the apparel sector.”
The state drew investment intentions worth Rs 2.03 lakh crore at the recent ‘Make in Odisha’ conclave. Chopra said the government would put in place a mechanism where these investment intents would be pursued.
On the traditional mineral-based industries, there exist new investment opportunities, said R K Sharma, principal secretary (steel & mines), Odisha.
Sharma said Odisha could look at economical ways to extract nickel as it was home to 90 per cent of the country’s deposits.
He also suggested that coal washery projects be tapped, so that dependence on coking coal imports could be reduced. Although the state’s prime focus was on major minerals given the revenue implications, it was also coming out with a new policy for auctioning minor minerals such as gemstones and granite.
Rinkesh Roy, chairman of Paradip Port Trust (PPT), spoke on the central government’s increasing thrust on coastal infrastructure.
He cited the Sagarmala project under which PPT is building an outer harbour at a cost upwards of Rs 9,000 crore. Big investments are also planned to augment rail capacities between Paradip and Angul.
Arun Misra, managing director of Tata Steel SEZ, stressed on the need to create infrastructure to lure investors in emerging areas such as electronics manufacturing. “When you move out of mineral-based investments, you got to create facilities so that they can quickly get into production.”
