By Bizodisha Bureau, Bhubaneswar, December 9, 2015 : Odisha could emerge as the front runner state by pursuing more investment friendly initiatives and pro-active policies for social sector development by building physical infrastructure.

Releasing a study titled ‘Realising economic potential of Odisha: A comparative investment analysis,’ The Associated Chambers of Commerce and Industry of India (ASSOCHAM) national secretary general, D.S. Rawat on Wednesday told media persons, “With a share of over seven per cent, Odisha has attracted outstanding investments worth about Rs 12 lakh crore out of the total investments worth over Rs 158 lakh crore attracted by various sectors from both public and private sources in top 21 states across India as on March 31, 2015.”

The resource rich state continues to be the favourite investment destination in the country despite environmental and other regulatory issues.

The state is third most preferred destination for investors with only Maharashtra and Gujarat ahead of Odisha with a share of 9.7 per cent and 9.5 per cent respectively in the total outstanding investments.

The state also ranks as the fastest growing state in attracting tourists thereby registering a jump of about 133 per cent in last 10 years, besides the state has also registered positive growth both in manufacturing and services sectors contrary to economic slowdown in India and globally, the study reveals.

“Focus on key sectors like healthcare, education, tourism, information technology, mining and minerals, infrastructure – port, energy, skill development, MSME, agro and food processing, handloom and handicrafts, petrochemicals and bio-pharma will transform Odisha’s economy and take the state on higher growth trajectory,” the study highlighted.

Replying to a question, Rawat sounded optimistic about the state emerging as the lead state in attracting investment for its rice resource base, cheap man-power, long coastline and peace loving people.

“Odisha, currently ranked as the third most preferred investment destination in India has significant potential to emerge as the most lucrative state for domestic and global investors, trade and industry provided it undertakes further initiatives to facilitate ‘ease of doing business’,” said Rawat.

“The only real chink in the armor in terms of economic performance if one may call it so is that Odisha is known to be a mineral rich state it stood fourth in terms of the Value of mineral production in 2013-14 with the value standing at Rs. 23018.08 crore. Therefore a drastic decline in growth rate in this sector from 8.7 percent in 2005-06 to 2.3 percent in 2014-15 is disturbing”, the study said and called for fine-tuning of the policies to further enhance the efficiency of the mining activities.

More investment friendly initiatives together with policies to further enhance mining activities, developing rural education policy aimed at providing access to quality education, public-private partnership (PPP) based development in irrigation and allied sectors, improvement in physical infrastructure are certain key suggestions for Odisha government listed in the study prepared by the ASSOCHAM Economic Research Bureau (AERB).

Manufacturing sector accounted for highest share of about 45 per cent in the total outstanding investments attracted by Odisha which augurs well for the state to sustain its economic growth in the long run.

Electricity (33 per cent), non-financial services (11.6 per cent) and mining (8.5 per cent) are other sectors that have garnered significant share in total outstanding investments attracted by the state.

Projects with investments worth about Rs six lakh crore i.e. almost half of the total outstanding investments (Rs 12 lakh crore) attracted by Odisha are under implementation, however the state has fared better than all India average of about 55 per cent in this regard.

“Government of Odisha should be complimented for its effort in reducing the under implementation rate of investment projects from over 60 per cent registered in 2012-13 to 50 per cent in 2014-15,” Rawat said replying to a question on his assessment of the performance of Naveen Patnaik government.

The Study has identified marine industry, tourism, exports of engineering, chemicals and allied products and horticulture as the potential segments in the state which could be tapped for higher growth rate.

In marine sector, the state has the potential to boost the value of total marine exports to over Rs 2,000 crore by 2019-20 from over Rs 1,800 crore in 2013-14, by focusing on aquaculture production based on research to enhance production, profitability and area under culture.

Similarly, to boost the neglected tourism sector, Odisha government must come up with more inclusive tourism policies and programmes to derive better synergy within the sector which has seen an increase of about 133 per cent i.e. from 46 lakh (both domestic and foreign tourists) in 2005 to over one crore in 2014, the study said.

Odisha being rich in minerals and ores, the state holds tremendous potential to promote export of engineering products through an effective, proactive and supportive institutional mechanism for rapid growth of exports that can reach Rs 14,867 crore by 2017-18 from Rs 3,531 crore registered in 2013-14.

In its study, ASSOCHAM has suggested the Odisha government to take advantage of the agro-climatic conditions favourable for developing of horticultural crops by adopting a cluster-based approach, development of robust post-harvest management infrastructure and providing training to farmers, entrepreneurs and other stakeholders in various farm related activities.

The industry body secretary general further informed that ASSOCHAM is preparing a ‘Blueprint for promoting ease of doing business in Odisha,’ which would be submitted to the chief minister, Naveen Patnaik within next two months.