State Level Actions to Promote Growth of · PDF fileState Level Actions to Promote Growth of...

State Level Resources to Promote the Growth of Manufacturing in Kerala

1

State Level Actions to

Promote Growth of Manufacturing (Resources and Capability Review)

Kerala

Prepared for

National Manufacturing Competitiveness Council

CENTRE FOR RESEARCH, PLANNING & ACTION

July, 2012


2

Though all care has been taken as to authenticity of various data

sources and accuracy of various presentations responsibility for any

errors that may remain as well as for opinions expressed lies with

Centre for Research, Planning & Action, New Delhi the agency that

carried out this study on behalf of NMCC.


3

Table of Contents

Table of Contents .............................................................................................................. 3

List of Tables ..................................................................................................................... 4

List of Figures .................................................................................................................... 5

List of Annexure ................................................................................................................ 5

1. State Profile ................................................................................................................ 6

2. Land for Industrial Purpose ................................................................................... 11

3. Basic Infrastructure ................................................................................................ 16

4. Profile of Logistics ................................................................................................... 18

5. Trends of Industrial Production ............................................................................ 24

6. Profile of Existing Industries .................................................................................. 31

7. Raw Materials .......................................................................................................... 34

8. Skill Profile of Manpower ....................................................................................... 35

9. Profile of Business Environment ............................................................................ 41

10. Incentives and Schemes ........................................................................................... 50

11. Conclusions and Core / Thrust Areas .................................................................... 52


4

List of Tables 1.1: Administrative Units in Kerala ................................................................................ 8

1.2: Districts of Kerala & Areas ...................................................................................... 8

1.3: Key Demographics of Kerala.................................................................................... 9

1.4: Share & Growth Rate of Manufacturing Sector in Kerala GSDP (Current

Prices) ............................................................................................................................... 10

2.1: Land Use Pattern in Kerala .................................................................................... 11

2.2: District-wise Waste Land in Kerala ....................................................................... 12

2.3: Industrial Parks of Kerala Industrial Infrastructure Corporation (KINFRA) 14

2.4: Major Industrial Estates – District Wise ............................................................... 14

2.5: Kerala SIDCO Industrial Parks in Kerala – District Wise ................................. 15

3.1: Total Generation Capacity in Kerala .................................................................... 16

4.1: Ports in Kerala ......................................................................................................... 18

4.2: Road Network in Kerala ......................................................................................... 19

4.3: Communications Snapshot of Kerala .................................................................... 23

5.1: Key Industries in Kerala ......................................................................................... 24

5.2: District-wise Distribution of Operating Factories ................................................ 24

5.3: Industrial Clusters in Kerala .................................................................................. 25

5.4: Time-Series Data Showing Growth in Past 5 Years in Kerala ............................ 28

5.5: Gross Capital Formation for the State of Kerala ................................................. 29

6.1: Number of SME Units Operating in Kerala (Mar, 2011) .................................... 31

6.2: MSME Clusters in Kerala ...................................................................................... 32

6.3: Sanctioned MSME Clusters under MSE-CDP Scheme in Kerala (As on

30.6.2011) ......................................................................................................................... 32

7.1: Mineral Production in Kerala (2009-10) ............................................................... 34

8.1: Technical Education Institutions in Kerala (2010) ............................................... 36

8.3: Percentage Share of Professional & Technical Work Seekers in Kerala ........... 38

8.4: Labor Strikes Over the Year in Kerala ................................................................. 39

8.5: Company Lockouts over the Years in Kerala ....................................................... 39

9.1: Single Window Clearance Process in Kerala ........................................................ 42

9.2: No. of Applications Cleared/Disposed Since Inception ........................................ 42


5

9.2 Special Agencies to Facilitate Industrialization ..................................................... 43

9.2: SWOT Analysis of Kerala Industrial Environment ............................................. 48

10.1: Project Lending Pre-requisites for KSIDC Financing ....................................... 51

List of Figures Figure 1.1: Map of India Showing the Location of Kerala ........................................... 7

Figure 1.2: Sector Contribution to Kerala GSDP ........................................................ 10

Figure 3.1 Road Network of Kerala .............................................................................. 17

Figure 4.1: Railway Network in Kerala ........................................................................ 21

Figure 4.2: Airports in Kerala ....................................................................................... 22

Figure 6.1: Industry-wise State Public Sector Units in Kerala ................................... 33

List of Annexure Annexure 1: Industry-wise Contribution to GSDP and Growth Rates ..................... 54

Annexure 2: Industrial Land with Directorate of Industries ..................................... 55

Annexure 3: Mini Industrial Estates in Kerala: District Wise ................................... 56

Annexure 4: Mineral Resources & Availability in Kerala .......................................... 57

Annexure 5: Ratio of the State on Key Characteristics of Overall and in

Manufacturing sector for India and Kerala ................................................................. 58

Annexure 6: Distribution of factories by employment in overall and manufacturing

sector in Kerala ............................................................................................................... 59

Annexure 7: Estimate of selected characteristics of factory sector by 3-digit industry

group (NIC-2008) for Kerala ......................................................................................... 60

Annexure 8: Engineering Colleges Intake in Kerala (2010-11) .................................. 63

Annexure 9: Trade Wise Intake in Polytechnics in Kerala (2010-11)........................ 64

Annexure 10: Select Manufacturing Sector Wages Rates in Kerala ......................... 65

Annexure 11: Cost of Doing Business in Kerala .......................................................... 68


6

1. State Profile

1.1 Introduction

1.1.1 The State has seen an average industrial growth rate of 10.56 percent at constant

prices in the last 5 years. The contributions of manufacturing sector to GSDP at constant

and current prices are 9.26 per cent and 9.33 per cent respectively during 2009-10. Some

of the key industries in the state include Handlooms & Power-looms, Rubber / Bamboo /

Coir Based Industries, Food Processing, etc.

1.1.2 The State Government has provided special support to MSMEs due to its high

employment and economic growth potential. This sector contributes greatly towards

domestic needs, export marketing and foreign exchange earnings by producing varieties

of products ranging from traditional to high tech. As on March 2010, there were about

213740 SSI/MSME units registered with a total investment of Rs. 731212.13 and direct

employment generation of 8, 31,847. Majority of the SME units operate in the Wood

Based, Food Products, Readymade Garments and General Engineering sectors.

1.1.3 For more information visit:

• http://www.kerala.gov.in

• http://www.ksidc.org

• http://www.keralasidco.com

• http://www.ibef.org/states/kerala.aspx

1.2 Location and Area

1.2.1 Kerala is located along the coastline, to the extreme south west of the Indian

peninsula, flanked by the Arabian Sea on the west and the mountains of the Western

Ghats on the east. The total area of the state is 38,863 sq km and encompasses 1.18 per

cent total land of India.


7

Figure 1.1: Map of India Showing the Location of Kerala

The nature of the terrain and its physical features, divides an east west cross section of

the state into three distinct regions- hills and valleys with an average elevation of 1500

meters, midland and plains and the coastal region. Western Ghats is the origination of

about 44 rivers that flow in the state, 41 of which flow towards west into Arabian Sea and

3 are tributaries of River Cauvery. In the Midland Plains of central region, the hills have

slightly steep with wide valleys allowing agriculture. The Coastal Belt strip is

comparatively plain with extensive paddy fields, thick groves of coconut trees and

backwaters, interconnected with canals and rivers.

1.3 Administrative Units

1.3.1 The State of Kerala is divided into 14 Districts. Following are the administrative

units in Kerala.


8

1.1: Administrative Units in Kerala

Districts 14

Revenue Divisions 21

District Panchayats 14

Taluks 63

CD Blocks 152

Revenue Villages 1453

Gram Panchayats 978

Corporations 5

Municipalities 60

1.2: Districts of Kerala & Areas

Region Districts Area (Sq.Kms)

(Sq. kms) North Kerala Kannur 2966

Kasaragod 1992

Kozhikode 2345

Malappuram 3550

Wayanad 2131

Central Kerala Ernakulam 2931

Idukki 4479

Palakkad 4480

Thrissur 3032

South Kerala Alappuzha 1414

Kollam 2498

Kottayam 2203

Panthanamthitta 2462

Thiruvanthapuram 2192

1.4 Demographic Information

1.4.1 The state has high density of population and the number of females per males is

the highest in the country. Table 1.3 lists the key demographics of the state.


9

1.3: Key Demographics of Kerala

Population 3,33,87,677

Male 1,60,21,290

Females 1,73,66,387

Sex Ratio 1,084

Population Density (Per Sq.Kms) 859

Literacy Rate 93.91%

Male 96.02%

Females 91.98%

Source: Census 2011

1.5 Economy of the State

1.5.1 The State’s economy is predominantly agrarian in nature. The Gross State Domestic

Product (GSDP) at factor cost at constant (2004-05) prices has been estimated to be

181289.12 crores for the year 2009-10, registering a growth of 9.73% over the previous

year. At current prices the GSDP is estimated to be 230315.55 crores during 2009-10,

registering a growth rate of 14.57% over the previous year.

1.5.2 The per capita State Income is estimated to be Rs. 52,984 as compared to national

income of Rs. 38,155 for 2009-10 at constant (2004-05) prices.

1.5.3 The contribution of primary sector has been decreasing and tertiary sector has been

increasing over the years, with the secondary sector remaining almost stagnant. Majority

of the economic growth in the State is due the growth in the tertiary sector. Table 1.4

lists the contribution of the three key sectors to the State GSDP.


10

Figure 1.2: Sector Contribution to Kerala GSDP

Constant (2004-05) Prices Current Prices

1.5.4 Annexure: I gives details on Industry-wise contribution of State GDP. Table 1.5

specifically highlights the contribution of Manufacturing Sector to the State GDP. From

the data we see that the share of Manufacturing Sector has been increasing and is also

showing higher growth rates year-on-year.

1.4: Share & Growth Rate of Manufacturing Sector in Kerala GSDP (Current

Prices)

Sector 2007-08 Growth

Rate (%)

2008-09 Growth

Rate (%)

2009-10 Growth

Rate (%) Manufacturing 15082.23 8.61 17865.66 8.89 21477.11 9.33

Registered 6437.81 3.68 7712.89 3.84 9464.67 4.11

Unregistered 8644.42 4.94 10152.77 5.05 12012.44 5.22

Source: Economic Review 2010

1.5.5 In terms of Human Development Index and life standard of the people, Kerala is

much ahead of the most other states in India, and in fact in certain development indices, it

is on a par with some of the developed countries. This peculiar paradox often termed as

the KERALA PHENOMENON or Kerala model of development by experts, which is

mainly owing to the performance of the State in the Service Sector.

Visit: www.kerala.gov.in


11

2. Land for Industrial Purpose

Land is one of the most invaluable resources as far as state of Kerala is concerned. The

state with its dense population, is finding it difficult to satisfy the land needs of even the

most deserving categories and development initiatives.

2.1 Non-Agricultural Land

2.1.1 Kerala has a diverse land use and cropping pattern. The land reforms introduced in

the State brought in radical and comprehensive institutional changes leading to drastic

transformation in the land holding pattern and a shift in the land use pattern.

2.1.2 Agriculture is still the dominant land use type accounting for over 55% of the

geographical area followed by forest land (including degraded forest) of 28%, with only

11% under non-agricultural use. Land under non-agricultural use was 9 percent in 1999-

00 and has increased to 9.68 per cent in 2008-09 and it slightly declined to 9.31 percent

in 2009-10. The area under cultivable waste increased by 1821 hectares, while barren and

uncultivated land declined by 7019 ha. Table 2.1 shows the land use pattern in Kerala.

2.1: Land Use Pattern in Kerala

Classification of Land 2009-10 2008-09

Hectares Percentage Hectares Percentage

Total Geographical Area 3886287 100 3886287 100

Forest Cover 1081509 28 1081509 28

Land for Non-Agricultures Uses 361695 9 376155 10

Barren and Uncultivated Land 17912 0.50 24931 1

Permanent Pastures and Grazing Land 96 - 229 0

Land under Miscellaneous Tree Crops 4423 0.10 6602 0

Cultivable Land 98014 3 96193 2

Fallow other than current fallow 45374 1 45955 1

Current Fallow 76945 2 67759 2

Net Area Sown 2180679 56 2088955 54

Area Sown more than once 488026 13 605988 16

Total Cropped Area 2668705 69 2694943 69

Source: Directorate of Economics & Statistics, Govt. of Kerala


12

2.2 Waste Land

2.2.1 As per the data available with Department of Land Resource, the total waste land

available in Kerala is 2458.7 hectares.

2.2.2 Table 2.2 shows the district wise waste land in the state.

2.2: District-wise Waste Land in Kerala

District Waste Land (Hectares)

Alappuzha 1.32

Kannur 201.24

Ernakulam 103.95

Idukki 449.57

Kasaragod 322.54

Kollam 45.77

Kottayam 120.5

Kozhikode 92.76

Malappuram 203.16

Palghat 457.86

Panthanamthitta 111.36

Thiruvananthapuram 182.99

Thrissur 80.72

Wayanad 84.96

Source: Department of Land Resources, Ministry of Rural Development, GoI

2.3 Industrial Land Bank

2.3.1 Availability of developed Industrial area

2.3.1.1 A major challenge for industrial development in the State is the non-availability

of adequate land. The State Government is in the process of acquiring land at strategic

locations of the state for orderly development of industries. Such lands will be kept as

‘land bank’ for future industrial and infrastructure requirements.

2.3.1.2 In its Industrial Policy 2007, the Government has encouraged recognizing leasing

of land for industrial and commercial purpose as equity participation by the landowners.

A Fast Track Mechanism is also being devised for transparency in land acquisition and its


13

utilization for the development of infrastructure through Public Private Partnerships, and

to address the address the concerns of the landowners through a time-bound

implementation of attractive rehabilitation schemes.

2.3.1.3 To avoid the situation of non-availability of land for future expansion /

implementation of latter phases of project, the developer will be allowed a ‘call option’

on buying adjacent land in future by remitting an annual premium to the Government for

a fixed period. The appropriate market value of the land will be provided to the

landowner.

2.3.1.4 The Government is also making provisions for the conversion of Industrial land

/plots into Industrial Parks / Commercial Estates, in cases where the established industry

remained in production for at least 5 years. Any industry, which commenced production,

but has been closed due to Court Order / Government Order / declared sick by BIFR, will

also be considered for conversion, in relaxation of the condition of being in production

for 5 years.

2.3.1.5 Existing DA, DP, IE, Growth Centers etc. are being modernized, expanded and

upgraded to meet the requirements of the industry. Any unused land / unused

infrastructure facility already allotted will be resumed and reallocated for starting new

units. Distribution of Pattayam for DA / DP plots will be done on a fast track basis.

SIDCO plots will be allotted expeditiously. Industrial plots will not be utilized for non

industrial purposes and speculation of land will not be allowed. Annexure 2 provides the

details on the land available in the Industrial Estates being developed by the Directorate

of Industries.

2.3.1.6 Kerala Industrial Infrastructure Corporation (KINFRA) is another agency

responsible for the development of industrial land. Table 2.3 gives details on the land

available in KINFRA Industrial Parks. KINFRA is currently developing the following

new parks,

Kera Park – Thrissur


14

KINFRA Spices Park – Idukki

KINFRA Rubber Park – Panthanamthitta

Visit: www.kinfra.org

2.3: Industrial Parks of Kerala Industrial Infrastructure Corporation (KINFRA) District Name of Industrial Park Available Land (Acres)

Thiruvananthapuram KINFRA International Apparel Park 5.05

Panthanamthitta KINFRA Park, Adoor Food Processing / General

28.10

Panthanamthitta KINFRA Park, Kunnamthanam Land Built up space

2.00 8500 sq.ft

Ernakulam KINFRA Park, Mazhuvannur Food Zone 2.80

Malappuram KINFRA Food Processing Park, Kakkancherry Special Economic Zone

15.00

Palakkad KINFRA Industrial & Textile Park, Kanjikode 90.00

Wayanad KINFRA Park, Kalpetta (Undeveloped land) 12.00

Kannur KINFRA Park, Thalaserry 3.75

Kannur KINFRA Textile Centre, Nadukani 57.85

Kasaragod KINFRA Park, Seethangoli 1.00

Source: Kerala Industrial Infrastructure Corporation

2.3.1.7 Kerala Small Industries Development Corporation (SIDCO) is the agency

responsible for developing industrial estates for Micro & Small Enterprises. At present

there are 19 Development Area/Plot, 17 Major Industrial Estates, 3 Functional Estates

and 111 Mini Industrial Estates in the Co-operative and SIDCO series in the State.

Annexure III provides the details on land availability in Mini Industrial Estates. Table 2.4

gives district wise available land in Major Industrial Estates of Kerala SIDCO.

2.4: Major Industrial Estates – District Wise District Industrial

Estate Total Land

Available Land

District Industrial Estate

Total Land

Available Land

Alappuzha Kollakadavu 19.15315 50 cents Kottayam Ettumanoor 30.31 55 cents

Alappuzha Cherthala 8.94 20 cents Kozhikode West Hill 12.44 Nil

Ernakulam Palluruthy 1.86 Nil Malappuram Manjeri 4.99 Nil

Ernakulam Mudickal 4.6215 Nil Palakkad Karakkad 10.96 4 cents

Kannur Palayad 8.42 Nil Palakkad Olavakkode 21.93 2.98 acre

Kasaragod Kasaragod 16.84 39.81 cents

Thiruvanan thapuram

Pappanam code

18.5327 Nil

Kollam Umayanalloor 26.0343 15 cents Thrissur Kallettum 5 Nil

Kollam Karunaga ppally

8.63 35 cents Thrissur Ollur 29.5625 Nil

Kottayam Changana cherry

14.22 Nil

Source: Kerala Small Industries Development Corporation (KSIDCO)


15

Visit: www.keralasidco.com

2.3.1.8 Kerala SIDCO has established an Industrial Park in every constituency in charge a

separate Industrial Parks division. Table 2.5 provides details on the land available in the

industrial parks.

2.5: Kerala SIDCO Industrial Parks in Kerala – District Wise Name of Project Total Area

(Acres)

Allocable Area (Acres) Area Allotted

(Acres)

Available Area

(Acres)

Athani 11.81 7.07 6.94 0.13

Chelakkara 5.0251 4.2 Fully Allotted -

Angamali 15.39 13.47 12.2067 1.2633

Moodadi 3.7778 3.0373 Fully Allotted -

Shoranur 5.0104 3.8793 Fully Allotted -

Thiruvarpu 1.34 1.0295 Fully Allotted -

Kunnamthanam 5 1.5(3.5 Acres handed

over to CWC)

Under

Progress

1.5

Source: Kerala Small Industries Development Corporation (KSIDCO)

2.3.1.9 The major hurdle which comes in the way of the industrial development in the

state has been the inadequate infrastructure facilities. The Government intends to give

topmost priority to develop world-class infrastructure facilities to attract massive

investments in manufacturing and service sectors. The Government has evolved special

schemes to build up such facilities to convert the State into an investment friendly

destination. The initiatives include:

1. A proposed infrastructure company, Infrastructures Kerala Limited (INKEL), to

facilitate accelerated development of industrial infrastructure to attract massive

investment.

2. Develop major industrial water supply projects, power supply projects, sewerage

and effluent treatment plants etc., in industrial areas.

3. Ensure uninterrupted supply of quality power for industrial and commercial

purpose.


16

3. Basic Infrastructure

3.1 Power

3.1.1 Kerala is one among the few Indian states which have the lowest rates for

electricity for both domestic and commercial outfits. Kerala State Electricity Board is the

sole distributor of the electricity for the state of Kerala except for Thrissur Corporation

and Munnar where the distribution is managed by City Corporation and Tata Tea Ltd

respectively. There is a huge shortage of power from last few years and the State

Government is facing difficulties in providing sufficient power to the industries. Table

3.1 listes the current generation capacity in the state.

3.1: Total Generation Capacity in Kerala

Sr. No. Source Generation Capacity (MW)

1 Hydro 1780 MW

2 Thermal 430 MW

3 Nuclear 0

4 New & Renewable 140 MW

Total 2350 MW

Source: Energy Statistics 2011, MOSPI, Govt. of India

3.2 Water Supply

3.2.1 Kerala has many important rivers that flow from north to south; Valapattanam

river (110 kms.), Chaliar (69 kms.), Kadalundipuzha (130 kms.), Bharathapuzha (209

kms.), Chalakudy river (130 kms.), Periyar (244 kms), Pamba (176 kms), Achancoil (128

kms.) and Kalladayar (121 kms.). Other than these, there are 35 more small rivers and

rivulets flowing down from the Ghats.

3.2.2 The average per capita supply of water in major cities is 150 to 200 liters per

capita day. There are 1,745 rural water supply schemes and 69 urban water supply

schemes. To ensure uninterrupted supply of industrial water, the State Government has

proposed to develop major water supply projects in industrial areas. The current tariffs

for industrial use of water is Rs25/- per 1000 liters with a minimum charge of Rs. 250/-.


17

3.3 Roads

3.3.1 Roads are one of the basic modes of transportation system and also an important

priority sector of infrastructure. Systematic development of road is one of the important

pre-requisites for development and acceleration of growth in the economy. Among the

different modes of domestic transport systems, road transport carries more than 80

percent of the goods and passenger traffic. The network of roads, particularly from rural

to urban facilitates speedy movement of goods and services and ensures higher growth

trends, social integrity and well-being of the society. The productivity and efficiency of

road transport is directly linked with the availability and quality of road network.

3.3.2 Kerala has the highest road density among other Indian states and a well-

developed transport system operated by both public and private sector, thus enabling a

seamless movement of people and goods across the state.

3.3.3 Road density in the State is 417 Km/100 Sq.Km, which is far ahead of national

average of 100.39 Km/100 Sq.Km. The length of road per lakh population is 509.23 Km,

which is also much higher than the national average of 321.3 Km.

Figure 3.1 Road Network of Kerala


18

4. Profile of Logistics

4.1 Geographical Proximity to Ports

4.1.1 The State with a coastline of 590 kilometers has one Major port, 3 Intermediate

ports and 14 Minor Ports. Besides the Port of Kochi (a Major Port governed by Major

Port Trusts Act, 1963), there are 3 Intermediate and 14 Minor Ports in Kerala. Table 4.1

list all the ports operating in the state.

4.1: Ports in Kerala

Type Locations

Major Port Kochi Top of Form Intermediate Ports Neendakara, Alappuzha, Kozhikkode

Minor Ports Vizhinjam, Valiyathura, Thankasserry, Kayamkulam, Manakkodam, Munambam, Ponnani, Beypore, Vadakara, Thalasserry, Manjeswaram, Neeleswaram, Kannur, Azhikkal and Kasaragod

Source: Govt. of Kerala

4.1.2 The Major Port of Kochi is under the Ministry of Shipping, Government of India

while the intermediate and minor ports are under the administration of the Government of

Kerala. Most of the minor and intermediate ports in the State are seasonal in nature and

are underdeveloped. The Kochi Port, with container handling facility, is one of the most

modern international seaports in the country. It spreads over 827 hectares and has a water

frontage of 7.5 Km. An International Container Transshipment Terminal is being

developed at Vallarpadam in Kochi, completion of which would make the Kochi port a

major hub port in the Indian Ocean region.

4.1.3 The State Government has plans to provide a boost to coastal shipping with the

development of ports to ease the burden on the heavily congested highways in the State.

They have allowed private investment in Intermediate and Minor Ports from

1994.Government has also decided to develop a Deep Water Container Transshipment

Terminal at Vizhinjam in Thiruvananthapuram through PPP mode. The Terminal when

completed would be able to cater to container vessels up to 8000 TEUs in the initial

phase and 10000 to 12000 TEUs sizes in the subsequent phases.


19

4.1.4 Canals link the lakes and backwaters to facilitate an uninterrupted inland water

navigation system from Thiruvananthapuram to Vadakara, a distance of 450 kms. The

Vembanadlake stretching from Alappuzha to Kochi is the biggest water body in the state

and is over 200 sq.kms. in area. Kuttanad in Alappuzha district alone has more than 20

per cent of India's total length of waterways. Waterways are successfully used for

commercial Inland Water Transport using locally-made crafts and passenger vessels. The

Inland waterways in Kerala including navigable portions of rivers area are about 1687

kms. The West Coast Canal also called National Waterway III stretching from Kovalam

in the South to Hosdurg in the North is being renovated for commercial transport.

4.2 Spread & Quality of Road Network

4.2.1 Kerala has the highest road density among other Indian states and a well-

developed transport system operated by both public and private sector, thus enabling a

seamless movement of people and goods across the state. Table 4.2 lists the length of

road network in the state.

4.2: Road Network in Kerala

Sr. No. Type Length (Kms)

1 National Highways 1542

2 State Highways 4655

3 Major District Roads 17117

Total 23314

Source: PWD, Govt. of Kerala

4.2.2 The State Government has established Roads and Development Corporation of

Kerala Ltd (RBDCK) on 23rd September 1999 for building and strengthening

infrastructure facilities for the overall development of the state. RBDCK is intended to

give a thrust for multifaceted growth in transport infrastructure by generating additional

resources through institutional finance, market borrowing and private participation.

4.2.3 The Kerala Road Fund Board has been set up by the Kerala State Public Works

Department to bring in greater private sector participation into developmental activities

like:


20

• Promoting Public Private Sector participation in Infrastructural projects

• Funding Feasibility Studies for Innovative Road Projects

• Constructing new roads wherever necessary

• Implementing Road Safety Projects as are found essential for safe and smooth

movement of traffic

• Funding Research related to maintenance and development of roads

• Developing existing road network systems including upgrading roads maintained

by the PWD

• Implementing futuristic projects like Rapid Transit Systems and Metro Rail

Projects in Cities

4.3 Spread & Quality of Rail Network

4.3.1 The Indian Railways has spread its impressive network in Kerala connecting the

state with all the major cities of the country. A number of long distance trains operate

from Kerala to these locations on a daily basis. The Railway division at

Thiruvananthapuram, Palakkad and Madurai (Tamil Nadu) jointly carry out transport

operations in Kerala. The railway network extends over 1148 route Kms in Kerala of

which 111.14 km are meter gauge. The total route length of Railways in

Thiruvananthapuram Division is 625.80 km.


21

Figure 4.1: Railway Network in Kerala

4.4 Spread & Quality of Air Network

4.4.1 The state has three International Airports at Thiruvananthapuram, Kozhikode and

Kochi, of which the first two are owned by Govt. of India. The Cochin International

Airport is the first Greenfield airport in India setup on Public Private Partnership model.


22

Figure 4.2: Airports in Kerala

Together, they have handled 45,715 international flights, carrying 4.9 million passengers

and 36,598 domestic flights carrying 1.9 million passengers in 2008-09.

4.4.2 Besides expansion of the existing airports, two more airports are about to come up

in the State, one at Kannur district and the other at Aranmula in Panthanamthitta district.

These airports will not only cater to the large overseas community of Keralites, but also

help the tourism sector of Kerala with more connectivity and easy flying across the state.


23

4.5 Quality of Communication

4.5.1 Kerala has a tele-density of 80 per cent as compared to an all-India average of

52.7 per cent as of March 2010. The state has 1,242 automatic telephonic exchanges, of

which about 98% have Internet connectivity through the national Internet backbone.

According to estimates by the Telecom Regulatory Authority of India, Kerala had nearly

24.2 million wireless subscribers and 3.5 million wire-line subscribers as of March 2010.

Table 4.3 gives a snapshot of the communications in the state.

Visit: www.scribd.com/doc/54987552/kerala-190111

4.3: Communications Snapshot of Kerala

GSM cellular subscribers: 18,873,340

Internet/broadband subscribers: 1,059,800

Wireless subscribers: 24,194,621

Wire-line subscribers: 3,460,358

Post offices: 5,070

Telephone exchanges: 1,242


4.5.2 The state also has the highest penetration of optic fiber cable network in the

country and VSNL has an international communication gateway at Kochi with two high-

speed submarine cable landings (SEA-ME-WE-3 and SAFE) offering 15Gbps bandwidth.


24

5. Trends of Industrial Production

The State has had an average Industrial growth rate of 10.56 at constant prices in the last

5 years. The contributions of manufacturing sector to GSDP at constant and current

prices are 9.26 per cent and 9.33 per cent respectively during 2009-10. Table 5.1 lists the

key industries in the state.

5.1: Key Industries in Kerala

Handlooms & Power-looms Cashew

Rubber-based Industries Beedi

Bamboo-based Industries Mining

Coir-based Industries Tourism

Khadi & Village Industries Food Processing

Sericulture Spices & Spice Extracts

Seafood & Marine Products -

Table 5.2 gives the district wise distribution of operating factories from 2007 to 2009.

5.2: District-wise Distribution of Operating Factories

District 2007 2008 2009

Thiruvananthapuram 988 989 994

Kollam 1827 1827 1820

Panthanamthitta 2801 2823 2822

Alappuzha 412 418 419

Kottayam 231 231 244

Idukki 1273 1273 1274

Ernakulam 1508 1510 1535

Thrissur 1039 1041 1036

Palakkad 1948 1969 1968

Malappuram 622 622 623

Wayanad 2063 2064 2065

Kozhikode 2529 2547 2544

Kannur 895 896 895

Kasaragod 118 118 120



25

5.1 Nature of Industries

Micro, small and medium enterprises (MSMEs) sector contributes significantly to the

manufacturing output, employment and exports of the country. It is estimated that in

terms of value, the sector accounts for about 45 percent of the manufacturing output and

provide employment about 66 million persons in over 29 million units throughout the

country. In fact, it provides the maximum opportunities for both self-employment and

jobs next only to agriculture sector.

5.3: Industrial Clusters in Kerala

District Industries

Kannur Handlooms, Power-looms, Beedi

Allepey Coir Products

Idukki Agriculture & Forest Based

Thiruvananthapuram Handlooms, IT

Thrissur Power-looms, Handlooms, Textile, Timber, Tile, Canning

Palakkad Power-looms, Sericulture

Kollam Minerals & Mining

Kozhikode Rubber

Wayanad Minerals & Mining

Kasaragod Minerals & Mining

Kottayam Rubber, Food Products, Engineering

Ernakulam IT

Source: Directorate of Industries, Govt. of Kerala

5.1.1 Food Processing

Food processing industry has been recognized as a priority sector in Kerala due to its

potential for future growth and possibility of generating substantial employment. Kerala

Industrial Infrastructure Development Corporation (KINFRA) has been playing a pro

active role for the promotion of food processing industry in the State. KINFRA has set up

a number of food-theme based parks in the State. Being a priority sector, KINFRA has

also set up industrial parks to suit the specific needs of the food processing sector.

KINFRA Food Processing Park at Kakkancherry, Special Economic Zone (Food

Processing) at Kakkanchery, Food Processing Zone in KINFRA Small Industries Park,


26

Mazhuvannur, KINFRA Food Processing Park at Adoor and Seafood Park India Private

Ltd at Aroor are the five Food Processing Industries parks already set up by KINFRA.

5.1.2 Handloom Industry

Handloom Industry is a major traditional industry of Kerala and this sector stands second

to the coir sector in providing employment to about 1.00 lakh persons. Handloom

industry in the State is mainly concentrated in Thiruvananthapuram and Kannur districts

and in some parts of Kozhikode, Palakkad, Thrissur, Ernakulam, Kollam and Kasaragod

districts.

The Handloom industry in Kerala is dominated by co-operative sector with 94% looms

and remaining 6% of handloom units owned by industrial entrepreneurs. The co-

operative sector consists of both factory and cottage type societies. The largest number of

co-operative societies is in Thiruvananthapuram district, which accounts 53% of the total,

and the lowest in Wayanad and Panthanamthitta districts. The major products in

handloom sector of the State are dhothies, furnishing material, bed sheets, grey sarees and

lungi, which accounts for 67 percent of the total production in the industry. About 80.13

percent of the major handloom cloths are produced in the Southern region of the State

followed by the North (12 percent) and Central region (7.87 percent).

The overall production of handloom cloth by Handloom Industry of Kerala increased

from 20.20 million meters in 2008-09 to 23.95 million meters in 2009-10. The total value

of production also shows an increase from Rs. 146.38 crores in 2008-09 to Rs. 165.33

crores in 2009-10.

5.1.3 Coir Industry

Kerala accounts for 95 per cent of the total coir and coir products produced in India. The

coir industry provides employment to 383,000 workers. The Alappuzha district of Kerala

contributes around 90 per cent to the total coir produced in the state. The state has three

coir parks, two at Alappuzhaand one at Perumon, in Kollam. The Coir Co-operative

Marketing Federation (COIRFED) is the apex federation of around 819 coir co-

operatives. USA is the largest importer of coir products from India, followed by the

European Union.


27

5.1.4 Power-loom

Power-loom industry employs about 0.1 million people and ranks second among the

traditional industries of the state in terms of providing employment. The industry is

concentrated in the districts of Palakkad, Kozhikode, Thrissur, Ernakulam, Kollam and

Kasaragod. Around 94 per cent of the total number of looms is under the cooperative

sector, the rest being under industrial entrepreneurs. At the end of March 2009, there

were 676 registered primary handloom weavers co-operative societies (PHWCS),

consisting of 150 factory-type societies and 526 cottage-type societies. The overall

production of cloth in the co-operative sector of Kerala was 20.2 million meters in 2008-

09, valued at US$ 32 million.

5.1.5 Electronics

The self-contained Electronics Technology Park at Technopark, Thiruvananthapuram,

has been instrumental in attracting global electronics manufacturers. The state has an

advantage of the availability of skilled and semi-skilled workers for the electronics

industry. Major companies operating in this sector include Traco Cable Company

Limited, Transformers & Electricals Kerala Limited and Kerala State Electronics

Development Corporation Limited.

5.2 Quantum of Output

5.2.1 Table 5.4 shows time series data series showing growth in past five years in Kerala

from 2003-2004 till 2008-2009.The No. of Factories, Value of Output, Net Value Added

shows a uneven trend. There was decrease in no. of Factories in 2006-2007 over previous

years and shown a marginal increase from 2007-2008 till 2008-2009.The Value of Output

shows a increasing trend from 2003-2004 till 2005-2006.Thereafter it declined and shown

a increasing trend during 2008-2009.The Net Value Added was highest during 2007-

2008.It showed a decline during 2008-2009. Similar time series data based on several

characteristics is depicted in Annexure 7. Annexure 6 lists the distribution of factories

employment in overall and manufacturing sector in Kerala.


28

5.4: Time-Series Data Showing Growth in Past 5 Years in Kerala

Year Characteristics

No. of Factories Value of Output Net Value Added

2003-04 5491 3183189 409114

2004-05 5493 3611959 406601

AGR 0 13 -1

2004-05 5493 3611959 406601

2005-06 5643 4326786 446784

AGR 3 20 10

2005-06 5643 4326786 446784

2006-07 5554 5057943 355895

AGR -2 17 -20

2006-07 5554 5057943 355895

2007-08 5584 5556577 592824

AGR 1 10 67

2007-08 5584 5556577 592824

2008-09 5868 7090489 770511

AGR 5 28 30

ACGR% 1.3 17.4 13.5

* Annual Growth Rate * Annual Compounded Growth Rate

Source: Annual Survey of Industries, Ministry of Statistics, Planning & Implementation,

GoI., 2003-2008

5.2.2 Gross Capital Formation (GCF) – Gross capital formation had witnessed a huge

growth between 2003-04 and 2004-05 followed by sluggish growth between 2004-05 and

2005-06. The GCF had declined by about 30% between 2005-06 and 2006-07, followed

by another huge growth of 105%. Between the years 2007-08 and 2008-09, it declined by

56%. Table 5.5 lists the gross capital formation for the period between 2003-04 and

2008-09.


29

5.5: Gross Capital Formation for the State of Kerala

Characteristics Gross Capital Formation (Rs.)

2003-04 84491

2004-05 222346

AGR 163

2004-05 222346

2005-06 230537

AGR 4

2005-06 230537

2006-07 161708

AGR -30

2006-07 161708

2007-08 330916

AGR 105

2007-08 330916

2008-09 146806

AGR -56

ACGR% 12.00

* Annual Growth Rate * Annual Compounded Growth Rate

Source: Annual Survey of Industries, Ministry of Statistics, Planning & Implementation,

GoI., 2003-2008

5.3 Efficiency

5.3.1 Annexure 5 lists the ratio of key characteristics of efficiency of industry for

overall industry and in particular the manufacturing sector for India and Kerala. The fact

of the manufacturing sector not being a core sector of the State is evident in the ratio,

where the state is a lot lower on the characteristics.

5.4 Constraints

5.4.1 Availability of Land – Due the high density of population, there is a shortage of

industrial space in the state. Most of the industrial parks and estates have already been

fully allotted and the State Government is in the process of acquiring new land for

development. Until then there could be no major expansion of the industry in the state.


30

5.4.2 Infrastructure – The State is also facing the issues of inadequate and

underdevelopment infrastructure, particularly in Power and Logistics sectors. The State

Government has plans to develop rivers and backwaters to establish an Inland Waterways

System and ease the traffic on the road network.

5.4.3 Power Shortage – The State is currently facing a huge shortage of power supply and

there have been constant power-cuts for industries. Due the lack of available land for

power projects and environmental concerns, there could be no new power projects be

established in the State.

5.4.4 Environmental Issues – The State has a huge green cover and there have been issues

for developing factories which release pollutants. The current regulations also delays the

process of environmental permits for new units.

5.4.5 Greater Focus on Less Labor Intensive Jobs – Over the years the service industry in

the state has developed immensely attracting manpower from the state. This has led to a

shortage of skilled manpower for labor intensive manufacturing jobs.

5.4.6 Raw Material Shortage – Rubber-based Industries are prominent in the State and

currently there is a shortage of the raw material due to issues such as small landholding of

rubber plantations etc


31

6. Profile of Existing Industries

6.1 SMEs

6.1.1 Micro, small and medium enterprises (MSMEs) sector contributes significantly to

the manufacturing output, employment and exports of the country. In Kerala, the State

Government has provided special support to MSMEs due to its high employment and

economic growth potential. This sector contributes greatly towards domestic needs,

export marketing and foreign exchange earnings by producing variety of products

ranging from traditional to high tech. Though the volume of production of MSME sector

is very large, the quality of production, diversification of products, energy consumption

and environmental effects has always been a concern.

6.1.2 As of March 2010, there were about 213740 SSI/MSME units registered in the

state. The total investment in the tune of Rs. 731212.13 lakhs, the total number of

employment generated is 831847 and value of goods and services produced is Rs.

1545949 lakh. Table 6.1 lists number of SME units operating in the state based on

industry type. Table 6.2 lists the key MSME Clusters operating in Kerala.

6.1: Number of SME Units Operating in Kerala (Mar, 2011)

Industry

Type

No. of Units

Operating

Industry

Type

No. of Units

Operating

Wood Based 1057 Mobile Phone Repairing 97

Food Products 1619 Rexin Products 185

Readymade Garments 1553 Wax Candles 79

Cement Products 766 PVC Products 133

General Engineering 1821 Mineral Water 31

Software Development 504 Paper Products 175

Marine Products 26 Printing 324

Rubber Products 143 Miscellaneous Products/Services

3235

Fiber Glass Products 30 Total 11778



32

6.2: MSME Clusters in Kerala

District Location Product District Location Product

Alappuzha Alappuzha Coir & Coir Kollam Kollam Coir &

Ernakulam Ernakulam Rubber Kottayam Kottayam Rubber

Ernakulam Ernakulam Power- Malappuram Malappuram Power-

Ernakulam Kochi Sea Food Palakkad Palakkad Power-

Kannur Kannur Power- - - -

Source: MSME Institute, Thrissur

6.1.3 The Kerala Bureau of Industrial Promotion (K-BIP) is coordinating the Cluster

Development activities throughout the State in association with Directorate of Industries

and Commerce. It coordinates the implementation of setting up of Common Facility

Centers (CFCs) in clusters as per MSMEEDP scheme of Government of India. Table

below provides details on clusters that have been sanctioned under this scheme. Table 6.3

lists the sanctioned MSME clusters under the MSE-CDP Scheme in Kerala.

Visit: www.kerala.gov.in

6.3: Sanctioned MSME Clusters under MSE-CDP Scheme in Kerala (As on

30.6.2011)

Name of Cluster Location Total Investment

(Rs. Lakhs)

Rubber Cluster Changanacherry, Kottayam 266.54

Plastic Cluster Aluva, Ernakulam 490

Plywood Manufacturers Perumbavoor, Ernakulam 417.23

Terra Tile Cluster Thrissur 499.3

Furniture Cluster Ernakulam 496.58

Rice Millers Cluster Kalady, Ernakulam 713.4

Wood Cluster Malappuram 238.9

General Engineering Cluster Malappuram 315.01

Ethnic Food Processing Cluster Pala, Kottayam 454.86

Printers Clusters Ernakulam 253

Nature Fiber& Allied Products Cluster

Vaikkom, Kottayam 485


6.1.4 There were further proposals submitted by the State Government to Central

Government for developing the following clusters,


33

1. Wood Cluster at Chadayamangalam, Kollam

2. Wood Furniture Cluster at Kannur

3. Agriculture Implements Cluster at Shoranur, Palakkad

4. Offset Printers Cluster at Kannur

5. Toys Cluster at Kottayam

6. Garments Cluster at Kollam

6.2 Large Industries

6.2.1 There are 63 State Public Sector Units (SPSUs) under the Industries Department out

of which, 17 have remained closed for long periods. Five are welfare corporations and

four are developmental agencies. Thirty seven companies are directly engaged in

manufacturing activities. Table 6.4 gives a break up of SPSUs based on type of industry.

Figure 6.1: Industry-wise State Public Sector Units in Kerala


The PSUs have been showing a trend of growth, both in respect of turnover and profit,

compared to the performance during the preceding years. It is observed from the

performance of 37 PSUs, only 5 units are functioning in losses and it is mainly seen in

the co-operative sector.


34

7. Raw Materials

7.1 Description

7.1.1 The State is endowed with a variety of mineral resources; however they are not

available in plentiful amounts. There are occurrences/deposits of minerals such as Heavy

Mineral Sands ( Ilmenite, Rutile, Zircon, Monazite, Sillimanite), Gold, Iron ore, Bauxite,

Graphite, China Clay, Fire Clay, Tile and Brick Clay, Silica Sand, Lignite, Limestone,

Limeshell, Dimension Stone (Granite), Gemstones, Magnesite, Steatite etc. Mining

activities are largely confined to few minerals such as Heavy Mineral Sands, China Clay

and to a lesser extent Limestone/Limeshell, Silica Sand and Granite. Heavy mineral sand

and China Clay contribute more than 90% of the total value of mineral production in the

State. Table 7.1 listed the mineral production in Kerala for 2009-10.

7.1.2 There are extensive deposits of white clay and commercially valuable deposits of

graphite, lignite (brown coal), limestone, and mica in Kerala. Iron ore has been found at

Calicut. Kerala's monazite, magnetite, sillimanite, and zircon deposits are largely

undeveloped. Apart from this the beach sand of Kerala is rich in radioactive elements.

Although it has been proved that there are deposits of gold at some places of Wayanad,

Kozhikode and Malappuram districts, mining is yet to start. Neendakara, Chavara and

Kayamkulam regions have ample deposits of illuminate, magnetite, zircon etc. Kerala

State Mineral Development Corporation and the Mining and Geology Department play

the lead role in mining and research. Annexure 4 lists the location and mineral reserves.

7.1: Mineral Production in Kerala (2009-10) Mineral Production (Tons) Mineral Production (Tons)

China Clay 947619.8 Quartz 1145

Ilmanite 162066.67 Graphite 820

Rutile 8226.71 GBS 9765296.19

Zircon 16002.89 GDS 1109.65

Sillimanite 7310.29 Laterite 1322706

Silica Sand 179758.6 Brick Clay 1201741.1

Limeshell/Sea shell 85395.36 Ordinary Sand 2679072.5

Lime stone 686549.04 River Sand 5248901.6

Bauxite/Laterite 110451.44 - -

Source: Directorate of Mining & Geology


35

8. Skill Profile of Manpower

A long tradition of literacy and quality education has been the core strength of Kerala.

According to the 2011 census, Kerala’s literacy rate is 93.91%; well ahead of the national

average. With several reputed universities and technical institutions like engineering

colleges, institutes for information technology and management, research institutions, etc,

Kerala has the densest cluster of Science & Technology personnel in the country. The

large pool of educated and skilled human resource has substantial exposure to the best

practices of global business requirements thereby providing the state with the right

platform for social and economic growth.

Concerted effort is being made by the State Government for skill upgradation of work

force to match the world standards. The Government has plans for the formulation of a

scheme for capacity development of human resources for the next 20 years involving

premier institutes in the domain. A task force is being created to identify the skill sets

required for modern industries, setting up of finishing schools to meet the requirements

on the basis of the recommendations of the task force and establishing Management

Institutes for Micro Enterprise Development.

A number of factors are converging to create skills imbalance in the economy – changing

age of the workforce, larger generation of young workers and available resources,

changing nature of jobs from agrarian to manufacturing to servicing, need for

investments in training vis-à-vis growth requirements, and insufficient workforce

planning, to name a few.

8.1 Database of Training Institutions

8.1.1 The education system in Kerala is well established with infrastructure ranging from

primary schools to colleges of higher education. The state has allowed the setting up of a

number of private colleges, especially engineering colleges to supplement the

government colleges.


36

8.1.2 As of 2010 there are about 119 engineering colleges in the state with a total

sanctioned intake of 38009. Out of these engineering colleges, 105 (88.24%) are self-

financing colleges, 11 (9.24%) are government colleges and 3 (2.52%) are private aided

colleges. Kerala University has the largest number of engineering colleges affiliated to it.

During 2010, 35 self-financing engineering colleges are started in the state. Tables 8.1 list

the number of technical institutions in the state.

8.1: Technical Education Institutions in Kerala (2010)

Institutions Number Institutions Number

Government Engineering

Colleges

9 Fine Arts Colleges 3

Private Aided Engineering

College

3 Government Technical High

Schools

39

Government Polytechnic

Colleges

36 Government Commercial

Institutes

17

Government Women's

Polytechnic Colleges

7 Tailoring and Garment Making

Training Centers

42

Private Aided Polytechnic

Colleges

6 Vocational Training Centers 4

Source: Directorate of Technical Education

8.1.3 The Industrial Training Department is responsible for the functioning of Industrial

Training Institutes (ITIs) in the state. There are currently about 52 ITIs and a basic

training centre, with a total intake of 16503 students, of which 30% of the seats are

reserved for women candidates. Table 8.2 lists the district wise distribution of ITIs/ITCs

in the state.

Visit: www.det.kerala.gov.in/index.php


37

8.2: District Wise Distribution of ITIs/ITCs in Kerala

District No of Affiliated ITIs/ITCs

Total Government Private

General Women SCDD General Women SCDD

Thiruvananthapuram 62 4 1 6 51 0 0

Kollam 53 1 1 3 48 0 0

Panthanamthitta 35 1 0 1 33 0 0

Alappuzha 49 1 1 2 45 0 0

Kottayam 35 2 0 2 31 0 0

Idukki 10 1 0 0 9 0 0

Ernakulam 57 1 1 0 55 0 0

Thrissur 42 2 1 3 34 2 0

Palakkad 17 1 1 1 14 0 0

Malappuram 16 1 0 3 11 1 0

Kozhikode 27 1 1 1 23 1 0

Wayanad 4 1 0 0 3 0 0

Kannur 29 1 1 1 26 0 0

Kasaragod 9 1 0 2 6 0 0

Total 445 19 8 25 389 4 0

Source: Department of Industrial Training, Govt. of Kerala

8.2 Availability of Technically Qualified Persons

8.2.1 The number of professional and technical work seekers in 2009 was 1.65 lakhs.

This number slightly decreased to 1.61 lakhs in June 2010. The share of employment

seekers with professional and technical qualifications is given in the table below and it is

seen that more than 90 percent of the technical and professional employment seekers are

ITI and Diploma holders in engineering. Table 8.3 lists the percentage work seekers in

the state.


38

8.3: Percentage Share of Professional & Technical Work Seekers in Kerala Educational Qualification 2007 (%) 2008 (%) 2009 (%) 2010 (%)

Medical Graduates 1.55 1.55 1.66 1.28

Engineering Graduates 5.1 5.54 6.51 4.74

Diploma Holders in Engineering 23.56 22.21 24.8 23.6

ITI Certified holders 68.93 69.84 66.23 69.89

Agricultural Graduates 0.47 0.455 0.4 0.25

Veterinary Graduates 0.39 0.402 0.41 0.23

Total 100 100 100 100


8.2.2 Analysis of the sector wise growth of employment in public and private

establishments in Kerala in March 2010 revealed that the highest employment is in the

community, social and personnel services 44.29%, followed by manufacturing 22.91%,

financing and business services 9.20%, Transport 8.32%, Agriculture 7.17%, Electricity,

Gas, Water, Sanitary services 2.63%, Construction 1.91% and the lowest employment is

in the mining and Quarrying 0.239%.

8.2.3 Engineering colleges in the state offer varied courses to suit the needs of the

growing industry. Annexure 8 and 9 provide details on course-wise student intake for

engineering and polytechnic colleges.

8.3 Labor Wage Rate

8.3.1 The State Labor Department has identified 83 categories of employment spanning

agriculture, manufacturing and service industries under the Minimum Wages Act, out of

which minimum wages are notified in 46 employments. Annexure 10 lists the minimum

wages for key manufacturing industries of the state.


39

8.4 Attitude of Labor Towards Professional Work Culture

8.4.1 During 2009-10, 2352 industrial disputes were registered in the State. At the end

of the year, there were 5122 cases along with the pending disputes of previous year which

is less than 14.1% of previous year. A total of 2357 disputes were settled during the year

under review. Due to strike and lockout 39347 workers were affected which led to loss of

839788 man days. Table 8.4 and 8.5 lists the number of strikes and lockouts in the state

and the lost man-days.

8.4: Labor Strikes Over the Year in Kerala

Items 2005 2006 2007 2008 2009 2010

(As on

30.9.10)

Pending 1 0 1 0 4 3

Arose 10 6 2 22 18 8

Total 11 6 3 22 22 11

Man-day lost 3250553 86977 86746 394198 177494 135502


8.5: Company Lockouts over the Years in Kerala

Items 2005 2006 2007 2008 2009 2010 (As

on

30.9.10)

Pending 27 23 27 4 8 10

Arose 4 6 0 5 13 9

Total 31 29 27 9 21 19

Man-day lost

1855429 1811755 1505370 758144 506606 649439


8.5 Status of Labor Related to Legislation

8.5.1 The prominent role of the Labor Department is to maintain industrial peace and

harmony in Kerala. Enforcement of labor laws and implementation of labor welfare

schemes are pre requisites for maintaining the harmonious relation and creating


40

conducive climate for sustained investment. Labor Department is responsible for the

enforcement of labor enactments, settlement of industrial disputes, administration of

various welfare measures, revising / fixing the minimum wages of employees,

implementation of social security and insurance schemes so as to safeguard the rights and

privileges of working class and thereby providing a labor friendly atmosphere in the

State. There are 30 labor enactments administered by the Department. 83 categories of

employment have been covered by the minimum wages Act, 1948 out of which minimum

wages are notified in 46 employments.

8.6 Labor Regulations

8.6.1 Kerala is a model state for labor welfare measures. About 28 Labor Welfare Fund

Boards are functioning in Kerala under different departments. The State Government is

of the view that healthy labor relation and good work culture are the pre requisites for the

growth and sustenance of the industry. They have proposed to spearhead a massive

campaign to highlight the healthy labor relations and to remove the unfounded

perceptions.

The management will have the right to choose and deploy employees. However, local

workforce shall be engaged to the extent possible.

Government will take initiative in promoting a new management culture through regular

interaction with the industrialists and trade unions.

A reconciliation forum will be set up involving Departments of Labor, Industries and

Commerce, ensuring participation of trade unions for the effective redressal of labor

issues. Arbitration mechanism shall be implemented if industrial disputes arise, for

speedy decisions.

Public Sector Advisory Board and Fast Track Labor Courts will be constituted for Policy

making and dispute settlement.


41

9. Profile of Business Environment

9.1 Single Window System

9.1.1 Kerala is one of the first states in India to have legislation for statutory Single

Window Clearance. The Government of Kerala has introduced the Single Window

Clearance System from 1st June, 2000 for expediting the issue of various clearances for

new Industrial Projects. As per this system, a final clearance for all new projects, either

approval or rejection, is to be given within a specific period from the date of submission

of application; a statutory requirement under the Kerala State Single Window Clearance

Boards and Industrial Township Area Development Act 1999.

9.1.2 A State Level Board for aiding medium and large-scale industries has been

constituted in this regard, headed by the Chief Secretary, which shall issue clearances

within a timeframe of 45 days. Kerala State Industrial Development Corporation has been

designated as the Single Contact Point and the Convener of the State Board. The Board

has statutory powers to enforce its decisions.

9.1.3 In a similar manner, District Level Boards have been constituted for clearing

small scale industrial undertakings, with the District Collector as the Chairman and

General Manager, District Industries Centre as the Convener; the stipulated time frame

being 60 days.

9.1.4 Industrial Area Boards have also been set up in various industrial areas of the

state for the clearance of projects being set up in these areas. An officer not below the

rank of District Collector is the Chairman in each Board, with the Designated Authority

of the Industrial Area as Convener, to issue clearances within a period of 30 days

9.1.5 A composite application form has also been formulated, which the entrepreneur

needs to submit only at the designated contact points. With the introduction of the Single

Window Clearance System, setting up of Industrial projects in the State is expected to


42

become a hassle free operation. Table 9.1 shows the Single Window Clearance process

and Table 9.2 lists the number of applications cleared/disposed since inception.

9.1: Single Window Clearance Process in Kerala

9.2: No. of Applications Cleared/Disposed Since Inception

District Single Window Clearance Board Green Channel Counter

Received Disposed Received Disposed

Thiruvananthapuram 18 14 4 4

Kollam 220 210 1202 1199

Panthanamthitta 206 180 878 871

Alappuzha 80 76 1162 1162

Kottayam 150 147 3318 3318

Idukki 0 0 0 0

Ernakulam 243 218 756 745

Thrissur 91 86 2630 2599

Palakkad 195 186 5136 5133

Malappuram 108 104 739 734

Kozhikode 173 167 3558 3558

Wayanad 2 2 250 250

Kannur 218 210 8464 8456

Kasaragod 21 21 2393 2393

Total 1725 1621 30490 30422



43

9.2 Special Agencies to Facilitate Industrialization

9.2.1 Kerala State Industrial Development Corporation (KSIDC)

Kerala State Industrial Development Corporation Ltd. (KSIDC) is a wholly owned

company of Government of Kerala setup for the promotion and development of medium

and large scale units in the State. It acts as the nodal agency for foreign and domestic

investments in the state by providing comprehensive support for investors, besides

processing various incentive schemes and facilitating constant interaction between the

government and the industrial sector. The agency promoted more than 650 projects in the

State with an investment outlay of Rs.5155crores. Following are the key areas of focus

for the agency:

1. Identification of Investment Ideas

2. Translating ideas into concrete proposals

3. Feasibility Study, Project Evaluation

4. Financial Structuring, Loan Syndication

5. Assisting in Central and State Govt. Clearances

6. Development and Administration of Growth Centers

7. Industrial and Infrastructure development

On-Going Mega Projects

Life Sciences Park - KSIDC proposes to develop a Life Sciences Park at

Thiruvananthapuram. 260 acres of land in Veiloor Village have been identified for the

purpose and KSIDC is in the process of acquisition of this land for the project. The Life

Sciences Park, when functional, would be a geographic cluster of industry

(Biotechnology, Nanotechnology & Life Sciences), research institutions and sci-tech

academia. The Park would address the needs of the rapidly emerging life sciences

industry and is expected to attract investments, both domestic and foreign, in the related

areas.

Electronics Hub - KSIDC has initiated steps for setting up of an Electronic Hub at Kochi.

The proposed Electronic Hub would be developed in 330 acres of land, offering world


44

class facilities for manufacturing, contract manufacturing, R&D and fabrication units in

the electronics sector. The Hub would house companies in the semiconductor and

electronic components sector, including their manufacture, research & development,

design, etc. The land acquisition procedure has been initiated.

Petro-Chemical Complex - The market survey conducted by KSIDC by engaging M/s.

Industrial Development Service Pvt. Ltd. (IDS), New Delhi has established scope for

setting up a project for manufacturing Propylene Oxide utilizing Propylene available with

BPCL-Kochi Refinery. In this context, KSIDC has developed a proposal for setting up a

Propylene-based petrochemical complex at Kochi. The estimated investment for setting

up the above project is Rs.1000Crore. KSIDC has prepared a pre-feasibility report for the

project and is looking for technology tie-up.

Titanium Sponge Project - Govt. of Kerala proposes to set up a Titanium Complex in

Kollam District consisting of a Titanium Sponge Plant of 10000 tons per annum capacity,

Titanium metal and downstream products. The proposed plant will be located adjacent to

the Kerala Minerals and Metals Ltd. (KMML), Chavara, a Govt. owned company

producing Titanium products. An extent of about 300 acres of land has been identified for

the project. KSIDC has commissioned a consultant to conduct techno-economic

feasibility of the project.

LNG Terminal - As the State's Promotional Agency, KSIDC has been instrumental to

facilitate establishment of the LNG Terminal at Kochi. The Terminal is being

implemented by M/s. Petronet LNG Ltd, a joint venture of ONGC, GAIL, IOC and

BPCL. Capacity of the LNG Re-gasification Terminal in the 1st phase is 2.5 Million

TPA, which will be enhanced to 5 Million TPA in the 2nd phase. The location is inside

the Cochin Port SEZ at Puthuvypeen, Kochi. The project aims to supply Regasified LNG

(R-LNG) to various customers in sectors like power, fertilizer, and industrial sector and

for City Gas Distribution (CGD) in the Southern States of Kerala, Tamil Nadu and

Karnataka, with the pipeline infrastructure is in place. The project, which has an

estimated cost of Rs.3,600Crores in the 1st phase has 3 major components, viz., Storage

Tanks, Marine Facility and Re-gasification Facility. 2 Nos. of Storage Tanks with a total

capacity of 5 Million TPA are under construction.


45

GAIL Pipe Line Project - KSIDC has signed an MoU with M/s. GAIL India Ltd, a'

Navaratna' Central PSU to facilitate establishment of Gas pipeline in the State of Kerala.

GAIL proposes to lay Gas pipeline from the Kochi LNG Terminal to various bulk

consumers of Gas in Kerala, Tamil Nadu and Karnataka. GAIL is laying the pipeline in

the following routes, for supply of R-LNG from the Kochi Terminal.

1. Kochi-Koottanad-Bangalore-Mangalore Pipe line (KKBMPL) Project

2. Sub-Sea Gas pipeline from Kochi to NTPC, Kayamkulam

3. The project will be implemented in 2 phases. The 1st phase is expected to be

completed in 2012 and the 2nd phase in 2013. The total project cost is estimated

at Rs 3,700 Crores.

Gas Distribution Project - KSIDC has signed a JV Agreement with GAIL for promoting a

Joint Venture Company (JVC) to develop Gas Distribution Project in Kerala. The JVC

proposes to create the Supplementary Gas Infrastructure in the State. It also intends to

take up City Gas Distribution Projects in the State.

Industrial Corridor - The Kochi-Coimbatore, Kochi-Kasaragod Industrial Corridor is

designed to utilize the existing infrastructure and new projects like LNG Terminal, ICTT

Vallarpadam, LNG Pipelines and High Speed Rail Corridor. The vision of the project is

to create strong economic base with global competitive environment and state of art

infrastructure to activate local commerce, enhance foreign investment and attain

sustainable development. The project is conceived to be developed as a global

manufacturing and trading hub supported by world class infrastructure and green

technology. The goals of the project are to double the employment, industrial output and

exports within a period of 5 years. The RFP for consultancy and pre-feasibility study will

be issued immediately. The first phase of the project proposes to start the corridor with

5000 hectares of land in the Kochi-Coimbatore route. The project would be implemented

through an SPV which would coordinate project development, finance and

implementation.

Gas based Thermal Power Project - Govt of Kerala, vide Govt order GO (MS)

No.19/2009/ID dated 07..02..2009, have appointed KSIDC as nodal agency for

development of thermal power project at Cheemeni, Kasaragod and allocated 2000 acres

of land necessary for the project. Govt. has constituted a Steering Committee with Chief


46

Secretary as Chairman for taking decisions on the project. Vide GO dated 1.12.2010

Govt. of Kerala have accorded administrative sanction for setting up of Gas based

Thermal Power Plant at Cheemeni, Kasaragod with project configuration of 1100-1200

MW units. A Special Purpose Vehicle (SPV) with 50:50 equity participation by KSIDC

and KSEB is being formed shortly for development of the power project. KSIDC has

appointed consultants for carrying out DPR&EIA studies, and the DPR is available.

Government of Kerala will be providing land on lease and obtain clearances for the

project. Apart from these, the Govt. will also provide Viability Gap Funding Grant to the

extent of Rs.500crores covering a period of 5 years. The project would be developed

through a developer selected through tariff based competitive case -2 bidding guidelines

of Govt of India. The process for selection of developers will be initiated shortly.

KSIDC has developed four Industrial Growth Centers (IGC) in the State, located at

Kannur, Kozhikode, Malappuram and Alappuzha districts. The Industrial Growth Centers

are aimed at the development of industrially backward districts of the State. The

Industrial Growth Centers are under various stages of development and thrust is given for

improving essential infrastructure facilities, in order to attract entrepreneurs.

All IGCs are provided with basic infrastructure facilities required for industries like

Roads, Telecommunication, Water Supply, Power, Administrative Buildings, etc. Land is

allotted to prospective entrepreneurs in the form of industrial plots and built up area.

Visit: www.ksiidc.com

9.2.2 Kerala Small Industries Development Corporation Ltd. (SIDCO)

KERALA SIDCO is a promotional agency set up as a Public Sector Undertaking by the

state government for providing assistance to SSI's such as providing infrastructure

facilities, distribution of essential raw materials, marketing of the SSI products,

undertaking civil and electrical works etc. The agency also acts as a nodal body for

supplying Bitumen to local Bodies as nodal agencies and Paraffin Wax to Small Scale

Industries. Currently the agency owns about 12 industrial lands in the state.

Major functions of the agency include – offer factory sheds & developed land in all

districts of the state, provide industrial raw materials through district depots, marketing

assistance etc.


47

9.2.3 Kerala Industrial Infrastructure Corporation (KINFRA)

Kerala Industrial Infrastructure Development Corporation (KINFRA) aims at bringing

together all the suitable resources available in the state and developing infrastructure to

boost industrial growth in the state. It has 12 well-defined industrial parks of which many

are functional and some are in the launching phase. Each of these Parks offer

comprehensive infrastructure and support services to the clients. The most fascinating

feature of KINFRA is that it offers single window clearance facilities, along with

attractive incentives and excellent opportunities for expansion and diversification.

Visit: www.kinfra.org

9.2.4 Kerala Financial Corporation (KFC)

Kerala Financial Corporation was established by the State Government with the objective

of enabling rapid industrialization of the state by extending financial assistance to Micro,

Small and Medium Enterprises in manufacturing and service sectors.

Visit: www.kfc.org

9.2.5 Infrastructure Kerala Ltd. (INKEL)

Infrastructures Kerala Limited is a company promoted by Government of Kerala and

prominent global investors and industrialists for conceptualizing, developing and

operating projects across sectors including SEZs, industrial parks / estates and physical

infrastructure. It acts as a key-link between the State government and private sector, thus

maximizing investments by promoting and facilitating major infrastructure projects in the

State.

Visit: www.inkelkerala.com

9.2.6 Kerala Bureau of Industrial Promotion (K-BIP)

Kerala Bureau of Industrial Promotion (K-BIP) was established as an autonomous body

under the Industries Department for the promotion of potential business opportunities in

the state. It works in close co-ordination with other promotional agencies of the state for

the uplift of the industrial development giving specific attention to the strategic


48

advantages of the State. It acts as an interface between prospective entrepreneurs and

other State agencies. It also provides linkage between national and international agencies

for technology upgradation, technology development and technology management for the

various sectors. Major activities of the Bureau include:

1. Act as a single-point source for information to present and prospective

entrepreneurs

2. Identify prospective entrepreneur and motivate them in establishing industrial

units and other productive ventures

3. Support entrepreneurs in selection of product, technology, plant and machinery

and location

4. Consulting services for the preparation of Project Profiles, Market Survey Reports

and Project Reports

5. Organize training programmes and workshops

6. Co-ordinate the promotional activities of all institutions involved in the industrial

development of the State

7. Establish, maintain or manage offices, bureaus, counters, conference halls

anywhere in India required to further the cause of industrial development of

Kerala

Visit: www.keralaindustry.org

9.2.7 SWOT Analysis of Kerala’s Industrial Environment is presented in Table 9.2.

9.2: SWOT Analysis of Kerala Industrial Environment

STRENGHTS WEAKNESSES

Greater focus of the New State Government on the development of Industry High Literacy Rate ensuring availability of skilled manpower Abundant natural resources such as Rubber, Spices, Minerals etc

Shortage of Industrial Land – Majority of Industrial Parks are already full State facing acute power shortage leading to industry inefficiency Underdeveloped logistical infrastructure connecting interior regions to ports


49

Cont…

OPPORTUNITIES THREATS

Located close to a major Global Trade Route Potential for Electronics & Light Engineering based industries Potential for Food-Processing Industry due to its proximity to Middle East Availability of Inland-waterways which can be developed for direct connectivity to Ports

Rampant increase in manufacturing industry may to lead to destruction of environment which is key for the State to maintain is Tourism dominance

9.3 Cost of Starting a Business

Annexure XI provides detail on the Cost of Starting a Business for the State of Kerala. It

gives a detailed summary of the bureaucratic and legal hurdles an entrepreneur must

overcome in order to incorporate and register a new firm, along with their associated time

and set-up costs. It examines the procedures, time and cost involved in launching a

commercial or industrial firm with up to 50 employees and start-up capital of 10 times

the economy's per-capita gross national income (GNI).


50

10. Incentives and Schemes

10.1 Packages offered to Entrepreneur / Industrialists

10.1.1 The State Government intends to capitalize the inherent strength of the State to

attract investments by providing incentives for investments in supporting facilities and

those equipments and systems. The proposed incentives under the Industrial Policy

include:

a. Subsidy upto 50% of the cost of capital equipments used in pollution control,

effluent treatment and other allied functions, subject to maximum of Rs.25 lakhs.

b. Special incentives package / facilities to large Investments with Rs.100 crores

and above to be considered on a case to case basis by the High Level Committee

chaired by the Chief Minister.

c. Incentives for all type of enterprises in line with the MSME Act of the

Government of India.

d. Price preference policy for Micro & Small Enterprises as stipulated in the Micro

Small & Medium Enterprises Development Act

e. Modify the existing Negative List with a view to extend the coverage of

incentives. The revised list of negative industries will be published.

10.1.2 Project Lending Scheme to Medium & Large Scale Industries

KSIDC offers financial assistance and support to medium and large scale industries in the

State including service sectors like tourism, star category hotels, resorts, hospitals,

infrastructure projects, etc and where the constitution of assisted unit is in the nature of

Private/ Public Ltd Company.

Usually assistance is extended to projects with an investment of Rs.200 Lakh and above

and our term loan assistance is limited to a maximum of Rs.2000 Lakh in a project and it

can go up further in a single project with State Government''s permission. The definition

of the medium and large scale manufacturing industries as defined by the Central

Government is applicable to Corporation also.


51

In addition to the above, the project should be financially and technically viable with

satisfactory financial indices like Internal Rate of Return (IRR), Debt Service Coverage

Ratio (DSCR), payback period etc, and the promoter directors should execute personal

guarantees with the Corporation for the timely repayment of the financial assistance

sought.

Visit: www.ksidc.org/projectlending.php

10.1: Project Lending Pre-requisites for KSIDC Financing

Debt Equity Ratio

(a) 1:1 up to 1.5:1 for new companies with minimum/no track record. (b) 1.5:1 upto 2:1 for companies in the thrust sectors/expansion of good assisted units & other good non-assisted units.

Term Loans Up to Rs.20Crore can be sanctioned. No cap for term loan under direct financing. However loan exceeding Rs.20crore is subject to approval by State Govt. The minimum amount considered for assistance is Rs.1 Crore except in case of expansion proposals of assisted units, where the minimum limit would be Rs. 50 lakhs.

Short Term Loan

May be considered for assisted units on a selective basis.

Repayment Repayment period is 6-8 years with a moratorium of 2-3 years, on a selective basis.

Interest Rate Based on a sliding scale with interest band ranging from 10.50 - 12.50% for thrust sectors & 11.50 - 13.50% for others.

Source: KSIDC

10.1.3 Equipment Purchase Loan Scheme

KSIDC has an Equipment Purchase Loan Scheme, which is a scheme devised and

followed by IDBI for their existing good clients.

Under this scheme, loan will be given to purchase items of Plant & Machinery required

for improving the capacity utilization, production efficiency, etc, of an industrial

establishment, subject to certain terms and conditions as given below.

The Debt-Equity ratio is very liberal, as financing will be provided upto 77.5% of the

invoice value of the equipment. The balance 22.5% of the invoice value is the minimum

margin required to be invested by the Promoter. The security is exclusive. Payment

period of upto six years is allowed. The institution/ firm need to have continuous Net

Profit for the last 3 financial years. Accounts of the firm need to be maintained regularly.

There should not be any default to any financial institution/ bank.


52

11. Conclusions and Core / Thrust Areas

11.1 Conclusions

The new State Government has envisaged a 100-day program towards the development

of the state by bringing in industry-friendly policies and establishing institutional

structures for industrial growth. Following key initiatives have to be quickly taken up for

increasing the competitiveness of the state.

11.1.1 Industrial Policy – The State requires a new industrial policy since the previous

one was released in 2007. There should be a greater focus on providing incentives and

capital support to investors.

11.1.2 Creation of Land Banks – One of the major constraints for any industrial project

is the availability of land. There is an immediate need for the creation of land banks for

industrial use.

11.1.3 Availability of Power – The State has been facing huge power shortages for a

while and this will be a deterrent to prospective investors for setting up industries in the

state. The State has to evolve a policy to either improve power generation locally or allow

industries to purchase power directly from other states/private power companies.

11.2 Core / Thrust Areas

11.2.1 Food Processing

Because:

Food processing industry has been recognized as a priority sector in Kerala

Food Processing Parks,Zones and SEZs for food processing are amongst the several

industrial infrastructure that have been established


53

11.2.2 Coir

Because:

Kerala has 95 percent of the total coir produced in the country

Presence of suitable infrastructure to support the development of the coir industry in the

form of coir parks

Potential to export coir products-US and European Union are the biggest markets.


54

Annexure 1: Industry-wise Contribution to GSDP and Growth Rates

Industry of Origin 2009-10 at Current Prices Growth Rate (%)

1 Agriculture & Allied Activities 26424.2 11.47

2 Forestry & Logging 3509.75 1.52

3 Fishing 2704.55 1.17

4 Mining & Quarrying 2730.65 1.19

Subtotal of Primary Sector 35369.2 15.36

5 Manufacturing 21477.1 9.33

5.1 Registered 9464.67 4.11

5.2 Unregistered 12012.4 5.22

6 Electricity, Gas and Water Supply 3715.33 1.61

6.1 Electricity 3375.31 1.47

6.2 Gas 45.1 0.02

6.3 Water Supply 294.92 0.13

7 Construction 28111.2 12.21

Subtotal of Secondary Sector 53303.6 23.14

8 Transport, Storage & Communications 21660.1 9.4

8.1 Railways 742.77 0.32

8.2 Transport by other means 16428.6 7.13

8.3 Communications 4379.03 1.9

8.4 Storage 109.61 0.05

9 Trade, Hotel & Restaurants 48685.1 21.14

10 Banking & Insurance 11991.6 5.21

11 Real Estate Ownership, Business, Legal 27306.4 11.86

12 Public Administration 9557.02 4.15

13 Other Services 22442.6 9.74

Subtotal of Tertiary Sector 141643 61.5



55

Annexure 2: Industrial Land with Directorate of Industries

District Name of DA/DP Total Area

Allotted Area

Available Area

Thiruvananthapuram

DA Vcli 108.63 88.28 20 Cents

DP Manvila 27.53 22.69 -

Kollam DP Mundakkal 20.667 18.088 -

Panthanamthitta DP Kunnathanam 20.94 15.37 0.41 Acres

Alappuzha DA Kollakadavu 16.22 15.47 -

DP Chengannur 5.51 4.28 -

DA Punnapra 57.28 53 -

Coir Park 1 Cherthala 23.4 21.2 -

Coir Park 2 Cherthala 17.06 16.54 -

CIE Aroor 15.8 12.33 -

DA Aroor 47.17 41.78 -

Kottayam Poovanthuruthu 41.25 37.32 -

Athirampuzha 1 0.86 -

Vaikom 3.75 3.25 -

Idukki DP Muttam 5 4.58 -

Ernakulam DA Aluva 57.82 54.91 -

DA Edayar 435.22 376.71 3.91 Acres

DA Angamaly 219.52 214.52 2.10 Acres

DA Vazhakulam 15.26 12.16 -

DP Angamaly 31.91 26.62 25 Cents

DP Kalamassery 78.12 64.74 7 Cents

Thrissur Athani 48.286 43.286 .20 Acres

Kunnamkulam 3.0035 2.1 .10 Acres

Ayyankunnu 29.32 21.6 .60 Acres

Velakode 24.066 21.866 1.1

Kozhikode DP West Hill 12.63 10.33 -

Palakkad Pudussery 134.15 129.99 0.22 Acres

Janjikode-NIDA 532.8 513.44 0.69 Acres

DP Kappur 18.26 16.71 2.44 Acres

DP Shornur 17.72 17.12 10.62 Acres

Kanjikode (W) 143.14 -

Malappuram FIE Manjeri 16.19 6.79 -

Kannur DP Andoor 59.31 46.61 -

Kasaragod DA/DP Ananthapuram

212.5 203.58 152.79

Chathanchal 28.5 24.48 1.86



56

Annexure 3: Mini Industrial Estates in Kerala: District Wise

District Industrial Estate Total Area Vacant Land

Alappuzha Kadakarapally 1 Acre Nil

Alappuzha Mararikulam 1 Acre Nil

Ernakulam South Vazhakulam 1 Acre Nil

Ernakulam Rayamangalam 1 Acre Nil

Ernakulam Piravam 1 Acre Nil

Ernakulam Kothamangalam 1 Acre Nil

Ernakulam Edathala 1 Acre Nil

Idukki Olamattom 1 Acre Nil

Idukki Kodikulam 1 Acre 41 Cents

Iddukki Adimali 1 Acre Nil

Kannur Baliyapattom 1 Acre Nil

Kannur Thaliparamba 1 Acre Nil

Kasaragod Kanhangad 1 Acre 10 Cents

Kollam Chithara 1 Acre Nil

Kollam Thrikkovilvattom 1 Acre Nil

Kollam Chadayamangalam 1 Acre Nil

Kottayam Nattakam 1 Acre Nil

Kottayam Ayarkunnam 1 Acre Nil

Kottayam Pampady 1 Acre Nil

Kozhikode Perambra 1 Acre Nil

Kozhikode Kadalundi 1 Acre 15 Cents

Malappuram Edavanna 1 Acre Nil

Malappuram Oorakam 1 Acre Nil

Malappuram Kokkoor 1 Acre Nil

Palakkad Vaniyamkulam 1 Acre Nil

Palakkad Ottapalam 1 Acre Nil

Palakkad Pattambi 1 Acre Nil

Panthanamthitta Pandalam 1 Acre Nil

Thiruvananthapuram Ulloor 1 Acre Nil

Thiruvananthapuram Varkala 1 Acre Nil

Thiruvananthapuram Vellanad 1 Acre 20 Cents

Thiruvananthapuram Anad 1 Acre Nil

Thrissur Arimpur 1 Acre Nil

Thrissur Kattur 1 Acre Nil

Thrissur Mala 1 Acre Nil

Wayanad SulthanBathery 1 Acre Nil

Source: Kerala SIDCO


57

Annexure 4: Mineral Resources & Availability in Kerala

Mineral Reserves (million tons)

Region Available

Mineral Sands 144 Neendaraka, Kayamkulam

Iron Ore 84 Kozhikode, Malappuram,

Bauxite 12.5 Sooranad, Vadakkumuri, Chittavattom, Adichanallur (Kollam District) Mangalapuram, Chilambil, Sasthavattom, Attipra (Thiruvananthapuram),

China Clay 172 Thiruvananthapuram, Kollam, Kannur, Kasaragod

Ball Clay 5.67 Kollam, Alappuzha, Ernakulam, Thrissur, Kannur

Fire Clay 11.5 Coastal areas

Tile & Brick Clays

- Thrissur, Kozhikode, Ernakulam, Kollam, Thiruvananthapuram, Kannur and Palakkad

Graphite 6.81 Thiruvananthapuram, Kollam, Kottayam, Idukki and Ernakulam

Silica Sand 28.4 Alappuzha

Limestone 24 Million – Crystalline Limestone

Palakkad, Idukki

Gemstones* - Thiruvananthapuram and Kollam Districts

Granite - Thiruvananthapuram, Kollam, Panthanamthitta, Kottayam, Palakkad, Kannur, Kasaragod, Wayanad, Kozhikode,

Magnesite 0.037 Palakkad District

Steatite/Talc 7.94 Kannur District

*Chrysoberyl, Cat's eye, Alexandrite, Ruby, Sapphire, Beryl, Aquamarine, Topaz, Kornerupine, Zircon, Sphene, Spinel, Garnet


58

Annexure 5: Ratio of the State on Key Characteristics of Overall and in

Manufacturing sector for India and Kerala

Overall Sectors Ratio Manufacturing Sector Ratio

Characteristics Structural ratios ALL SECTORS Orissa

Structural ratios ALL SECTORS India

Structural ratios only for Manufacturing Sector Orissa

Structural ratios only for Manufacturing Sector India

Fixed Capital per Factory (Rs. Lakh)

203 680 206 672

Gross Output per Factory (Rs. Lakh)

1209 2107 1223 2154

Net Value Added per Factory (Rs. Lakh)

131 340 135 350

Workers per factory Number

56 57 58 58

Employee factory Number

65 73 67 75

Net Value Added per Employee (Rupees)

201938 465916 202999 465554

Emoluments per Employee (Rupees)

70569 114272 69811 115091

Wages per Worker (Rupees)

47612 68103 47000 68507

Source: Annual survey of Industries, Volume 1, 2008-09, MoSPI, GoI


59

Annexure 6: Distribution of factories by employment in overall and manufacturing

sector in Kerala Kerala All India

Characteris

tics

manufactur

ing sector

%

manufactur

all

the

% all

sector

manufactur

ing sector

%

manufactur

all the

sectors

% all

sectors

No. of

workers

322358 322358 33104

3

33104

3

8511704 8511704 877674

5

877674

5 Total

persons

367768 367768 38155

8

38155

8

10946303 10946303 113274

85

113274

85

0 --- 14 2360 42.74 2454 41.82 53175 36.49 56379 36.3

15 -- 19 512 9.27 569 9.70 15359 10.54 16509 10.63

20 -- 29 463 8.38 493 8.40 17288 11.86 18683 12.03

30 -- 49 571 10.34 643 10.96 18720 12.85 20318 13.08

50 -- 99 571 10.34 617 10.51 17752 12.18 19145 12.33

100 -- 199 403 7.30 444 7.57 10677 7.33 11261 7.25

200 -- 499 263 4.76 269 4.58 7530 5.17 7765 5

500-999 128 2.32 128 2.18 2795 1.92 2824 1.82

1000-1999 127 2.30 127 2.16 1440 0.99 1442 0.93

2000-4999 95 1.72 95 1.62 716 0.49 721 0.46

5000&

Above

29 0.53 29 0.49 274 0.19 274 0.18

Total 5522 100.00 5868 100.0

0

145727 100 155321 100

Source: Annual survey of Industries, Volume 1, 2008-09, MoSPI, GoI


60

Annexure 7: Estimate of selected characteristics of factory sector by 3-digit industry group (NIC-2008) for Kerala

Characteristics Number of Factories (no.)

Fixed Capital

Invested Capital

Total Output

Total Inputs

Gross Value Added

Net Value Added

Income Profit

Post Harvest Crop Activities (016) 7 75 87 61 70 -9 -22 -22 -34

Processing and preserving of fish, crustaceans and molluscs and products thereof (102)

114 19683 33402 146414 133782 12632 10426 1448 -2181

Processing and preserving of fruit and vegetables (103)

35 1536 2281 4074 4064 10 -110 -191 -662

Manufacture of vegetable and animal oils and fats (104)

35 9757 17763 92747 89569 3178 1705 514 -1144

Manufacture of dairy products (105) 56 14217 16753 67461 59232 8229 6513 6070 2596

Manufacture of grain mill products, starches and starch products (106)

148 26334 48719 171540 164246 7294 4597 2425 573

Manufacture of other food products (107) 777 49856 143901 564121 469227 94894 90156 80749 31227

Manufacture of Prepared Animal Feeds (108)

18 4632 7249 39339 30898 8441 7795 7234 5850

Manufacture of Beverages (110) 41 30023 38437 60199 52869 7330 4051 3184 -563

Manufacture of Tobacco Products (120) 799 316 436 16801 6740 10061 10041 9970 860

Spinning, weaving and finishing of textiles (131)

162 94647 121294 60739 58373 2366 -6953 -14752 -25280

Manufacture of other textiles (139) 170 38496 55531 69936 70857 -921 -4230 -11984 -18617

Manufacture of wearing apparel, except fur apparel (141)

24 15404 18321 26439 17176 9263 8291 6782 829

Manufacture of knitted and crocheted apparel (143)

20 55 277 663 548 115 107 106 68


61

Tanning and dressing of leather; manufacture of luggage, handbags, saddlery and harness; dressing and dyeing of fur (151)

5 394 1893 4694 3667 1027 977 822 402

Manufacture of Footwear (152) 85 7023 10422 35927 28497 7430 5890 5361 3633

Saw milling and planning of wood (161) 216 820 1558 8886 7199 1687 1594 1399 245

Manufacture of products of wood, cork, straw and plaiting materials (162)

321 14120 23882 76683 65638 11045 9369 7356 1161

Manufacture of paper and paper products (170)

116 28488 45868 86404 63863 22541 19860 18220 8332

Printing and service activates related to printing (181)

117 8272 14502 40292 22138 18154 17351 15500 10430

Manufacture of refined petroleum products (192)

21 310443 465349 2765979 2580966 185013 165929 163986 163986

Manufacture of basic chemicals, fertilizer and nitrogen compounds, plastics and synthetic rubber in primary forms (201)

70 90979 124502 341243 307660 33583 24980 19682 19682

Manufacture of other chemical products (203)

118 24845 51792 128565 91904 36661 34154 31869 31869

Manufacture of pharmaceuticals, medicinal chemical and botanical products (210)

124 23883 35173 50953 35913 15040 12379 9226 9226

Manufacture of rubber products (221) 280 55816 88039 538541 430441 108100 100962 96711 96711

Manufacture of plastics products (222) 170 14037 21635 64768 50560 14208 12145 9626 9626

Manufacture of glass and glass products (231)

7 3551 4821 7096 6181 915 631 76 76

Manufacture of non-metallic mineral products n.e.c. (239)

867 60401 76833 113463 79891 33572 28183 25473 25473

Manufacture of basic iron and steel (241) 241 59747 135339 583786 552660 31126 25978 19177 19177


62

Manufacture of basic precious and other non-ferrous metals (242)

23 15073 23569 54068 46616 7452 6090 5125 1893

Casting of metals (243) 30 6389 12790 33837 31502 2335 1539 577 -1316

Manufacture of structural metal products, tanks, reservoirs and steam generators (251)

51 633 1046 3467 2597 870 818 786 -223

Manufacture of other fabricated metal products; metalworking service activities (259)

91 3436 5352 14033 11645 2388 2023 1708 -543

Manufacture of electronic components 19 27566 44330 92535 66828 25707 23357 18570 9426

Manufacture of communication equipment 3 952 2385 6584 5033 1551 1476 1401 182

Manufacture of optical instruments and equipment

8 405 3459 14811 9225 5656 5619 5542 4334

Manufacture of electric motors, generators, transformers and electricity distribution and control apparatus

29 1686 8757 41202 27475 13727 13467 13206 7312

Manufacture of batteries and accumulators 6 91 91 0 0 0 -9 -9 -9


63

Annexure 8: Engineering Colleges Intake in Kerala (2010-11)

Name of Course Total Intake

Applied Electronics and Instrumentation 1380

Agricultural Engineering 46

Architecture 180

Automobile Engineering 300

Bio-medical Engineering 180

Bio- Technology 300

Civil Engineering 4472

Chemical Engineering 170

Computer Science and Engineering 7460

Diary Science and Technology 25

Electronics and Communication 9060

Electricals and Electronics 5460

Electronics and Instrumentation 300

Food Technology 60

Instrumentation and Control Engineering 120

Industrial Engineering 30

Information Technology 2715

Mechanical (Automobile) 60

Mechanical Engineering 5181

Mechanical (Production Engineering) 90

Polymer Engineering 60

Production Plant Engineering 150

Printing Technology 30

Aeronautical Engineering 180

Total 38009



64

Annexure 9: Trade Wise Intake in Polytechnics in Kerala (2010-11)

Name of Trade Sanctioned Intake

Civil Engineering 1221

Mechanical Engineering 1584

Electrical and Electronics 1078

Electronics Engineering 2310

Chemical Engineering 121

Automobile Engineering 319

Textile Technology 198

Computer Science and Engineering 2035

Instrument Technology 198

Polymer Technology 198

Computer Hardware Maintenance 583

Tool and Die 132

Electronics Production Technology 132

Architecture 99

Electronics and Communication 462

Electronics and Instrumentation 390

Wood and Paper Technology 44

Printing Technology 77

Bio-Medical Engineering 66

Electronics and Aviation 55

Information Technology 66

Computer Application and Business Management 242

Commercial Practice 374

Total 11984



65

Annexure 10: Select Manufacturing Sector Wages Rates in Kerala

Scheduled Employment Category of Basic V.D.A. Total

Workers Minimum Wages

Wages

Ayurvedic & Allopathic Medicines Unskilled 96.23 68.06 164.29

Semi-skilled 100.54 68.06 168.6

Skilled 102.69 68.06 170.75

Highly skilled 107 68.06 175.06

Beedi and Cigar Industry Grade (3) 80.96 57.08 138.04

Grade (2) 85.19 57.08 142.27

Grade (2)(A) 87.3 57.08 144.38

Grade (1) 93.65 57.08 150.73

Block Rubber Factories Unskilled 135 68.06 203.06

Semi-skilled 150 68.06 218.06

Skilled 159 68.06 227.06

Brick Manufactures Unskilled 85.2 157.7 242.9

Semi-skilled 87.6 157.7 245.3

Skilled 90 157.7 247.7

Cashew Industry Lowest Rate 98.1 26.55 124.65

Highest Rate 115.1 26.55 141.65

Coir Manufacturing Piece rate wages exists

Fish Peeling and Fish Canning, Lowest Rate 132 43.46 175.46

Freezing and Exporting of Sea Foods. Highest Rate 230 43.46 273.46

Gold and Silver Ornaments Unskilled 175 51.66 226.66

Semi-skilled 225 51.66 276.66

Skilled 250 51.66 301.66

Handloom Industry Unskilled 118 51.66 169.66

Semi-skilled 124 51.66 175.66

Skilled 131 51.66 182.66


Hill Product Industry Lowest Rate 128 68.06 196.06

Highest Rate 130 68.06 198.06

Hosiery Manufacturing Unskilled 65 94.28 159.28

Semi-skilled 68 94.28 162.28

Hosiery Manufacturing Skilled 106.62 94.28 200.9

Highly skilled 164.3 94.28 258.58


66

Ice Factory Unskilled 72.96 81.26 154.22

Highly skilled 75.31 81.26 156.57

Khadi Industry categorized according to

Grade VII 115 51.66 166.66

turn over Grade VI 134 51.66 185.66

Grade V 144 51.66 195.66

Grade IV 153 51.66 204.66

Grade III 163 51.66 214.66

Grade II 173 51.66 224.66

Grade I 192 51.66 243.66

Light Motor Vehicles Lowest Rate 148 68.06 216.06

Highest Rate 174 68.06 242.06

Match Industry Lowest Rate 59.3 71.47 130.77

Highest Rate 66.7 71.47 138.17

Minor Engineering Unskilled 138 68.06 206.06

Semi-skilledGr.2

150 68.06 218.06

Semi-skilledGr.1

145 68.06 213.06

Skilled Gr.3 164 68.06 232.06

Skilled Gr.2 158 68.06 226.06

Skilled Gr.1 154 68.06 222.06


Supervisory 192 68.06 260.06

Minor Ports Lowest Rate 75 209.03 284.03

Highest Rate 139 209.03 348.03

Oil Mill Unskilled 123 68.06 191.06

Semi-skilled 126.8 68.06 194.86

Skilled 127.85 68.06 195.91

Power loom Industry excluding the workers employed in power loom section of Cotton Textile Mills in the State

Unskilled 71.8 80.11 151.91

Semi-skilled 73.38 80.11 153.49

Skilled 78.16 80.11 158.27

Highly skilled 78.16 80.11 158.27

Printing Press Unskilled 137.55 54.32 191.87

Skilled C 151.3 54.32 205.62

Printing Press Skilled B 166.4 54.32 220.72

Skilled A 183.1 54.32 237.42


67

Rice Mill, Flour Mill & Dhal Mill Unskilled 167 45.05 212.05

Semi-skilled 174 45.05 219.05

Skilled 181 45.05 226.05

Rubber Crepe Mills Unskilled 130 68.06 198.06

Semi-skilled 134 68.06 202.06

Skilled 139 68.06 207.06

Rubber Products Industry Unskilled 85 88.11 173.11

Semi-skilled 92.5 88.11 180.61

Skilled 95 88.11 183.11

Highly skilled 96.25 88.11 184.36

Tile Industry Unskilled 120.2 68.06 188.26

Semi-skilled 120.7 68.06 188.76

Skilled 121.8 68.06 189.86

Highly skilled 122.3 68.06 190.36

Timber Industry and Plywood Industry Unskilled 111 68.06 179.06

Semi-skilled 113 68.06 181.06

Skilled 115 68.06 183.06


Manufacture and sale of Umbrellas Guaranteed Minimum Wages - 125/-

Grade VII 155 43.42 198.42

Grade VI 165 43.42 208.42

Grade V 173 43.42 216.42

Grade IV 177 43.42 220.42

Grade III 185 43.42 228.42

Grade II 205 43.42 248.42

Grade I 231 43.42 274.42

Source: Department of Labor, Govt. of Kerala


68

Annexure 11: Cost of Doing Business in Kerala STEP Procedure Time to

Complete (in days)

Associated Cost (in INR)

1 Obtain director identification number (DIN) online from the Ministry of Corporate Affairs portal (National)

1 100

2 Obtain digital signature certificate online from private agency authorized by the Ministry of Corporate Affairs (National)

3 1500

3 Reserve the company name online with the Registrar of Companies (ROC) (National)

2 500

4 Stamp the company documents at the State Treasury (State) 5 1,525

5 Make a seal (Private) 30

6 Obtain a Permanent Account Number (PAN) from an authorized franchise or agent appointed by the National Securities Depository Ltd (NSDL) or the Unit Trust of India (UTI) Investors Services Ltd, as outsourced by the Income Tax Department (National)

15 67

7 Obtain a Tax Account Number (TAN) for income taxes deducted at the source from an authorized franchise or agent appointed

14 57

8 Register with the Office of Inspector, Shops and Establishment Act (State/ Municipal)

14 I500

9 Register for Value-Added Tax (VAT) at the Commercial Tax Office (State)

25 1,800

10 Register for Profession Tax at the Profession Tax Office (State) 9 No Cost

11 Register with the Employees' Provident Fund Organization (National) 18 No Cost

12 Register for medical insurance at the regional office of the Employees State Insurance Corporation (National) m

15 No Cost

State Level Actions to Promote Growth of · PDF fileState Level Actions to Promote Growth of...

Documents

Transcript of State Level Actions to Promote Growth of · PDF fileState Level Actions to Promote Growth of...