India is experiencing a phenomenal economic growth momentum making it amongst the fastest-growing major economies in the world expected to grow at 6.3% as per the International Monetary Fund’s World Economic Outlook (2023) report. The foundation of this developmental trajectory is built on the success and growth of its federal structure. India’s growth story has largely to do with its federal units (States and Union Territories) flourishing in parts and in unanimity with other states and UTs branding themselves uniquely as manufacturing, craftmanship, tourism, healthcare, and spirituality hubs. However, a state or UT’s potential to contribute to the nation’s growth is determined by flexible and transparent policy regulations and building a safe and sustainable environment for both domestic and international businesses across sectors to flourish.
To this effect, the state of Gujarat’s success story is one of the most dynamic ones to have taken place in 21st-century India. Gujarat accounts for 8.3 percent of India’s GDP, 18 percent of industrial output, and 33 percent of exports, its Gross State Domestic Product (GSDP) has grown from Rs 1.42 lakh crore to Rs 22.61 lakh crore in the last two decades and the future outlook for the state continues to look incredibly positive across sectors.
What makes Gujarat a rising state for investments?
Business-friendly policies, robust physical, social, and industrial infrastructure and a quality workforce have helped Gujarat achieve the feat of becoming a vibrant state for investments. Consequently, several sectors such as manufacturing, infrastructure, tourism, healthcare, and textiles, have flourished in the last two decades, making it home to over one hundred Fortune 500 companies and over 13 lakh MSMEs.
In 2022, Gujarat became the first state to implement the Semiconductor Policy in the country. Deemed as the ‘Most Preferred Destination’ in the production of semiconductor and display fab, this will only enable a further boost to its existing strength in the domain. With two mega food parks and more in the making, alongside over 30,000 operational food processing units the agro and food processing sector is also brimming with action and presents scope for investors.
A long favourite of automobile manufacturers, the state houses well-established auto-clusters and an upcoming lithium-ion battery manufacturing plant in the state which is India’s first will help contribute to the production of electric vehicles and fulfil the country’s commitment to increasing carbon-free, energy-efficient, and clean energy production. Besides creating room for investments in EVs, it also ushers in an opportunity to create direct and indirect employment in Gujarat.
Other sectors expected to witness growth are chemicals, petrochemicals, maritime and pharmaceuticals, among others. Gujarat has 649 registered pharma companies, which is the highest for any state in the country, of which 130 are United States Food and Drug Administration (USFDA) approved. This is a strong leverage for investments in further fortifying the pharma sector.
Additionally, a 1,600 km long coastline with numerous modern ports, has blessed Gujarat with a strategic advantage for trade and commerce, placing it uniquely in helping connect India to the world. As one of the key contributors to the Maritime India Vision (MIV) 2030, Gujarat is on a mission to further improve the operational capabilities of its 42 ports. The several ongoing public-private partnership projects under the centre’s flagship Sagar Mala Project, to develop terminals and maritime clusters, will also equip the state to boost the country’s maritime potential.
Additionally, Gujarat holds promising investment opportunities in Defence and aerospace sectors including artillery, combat vehicles, aircraft assembly, ammunition, small arms, and ship building. Further, the growing scope in A&D electronic systems, defence-tech fabrics, and composites adds to the state’s offering to India’s burgeoning defence sector and exports.
A promising future for Gujarat and India, at large
On the back of its current growth trajectory, Gujarat seems to be committed to realising Hon’ble Prime Minister Shri Narendra Modi’s vision of an “Aatmanirbhar Bharat” and “Viksit Bharat @ 2047”. The Hon’ble Chief Minister Bhupendra Patel has reiterated the state’s resolve to contribute significantly to making India a USD 5 trillion economy.
The government’s impetus to infrastructure development is leading to futuristic infrastructure projects like the GIFT City, Dholera Special Investment region, High Speed Rail, DREAM City, etc. in Gujarat which are all poised to play a significant role in a Viksit Bharat vision.
Continued investments in priority sectors like manufacturing, healthcare, tourism etc. will be crucial to achieving these goals and the state will have to continue to evolve its policies and maintain its attractiveness to keep the investors interested. Gujarat has immense potential to attract industries from emerging and sunrise sectors like Semiconductor & Electronics System Design & Manufacturing (ESDM), Green Hydrogen & Green Ammonia, Renewable Energy Ecosystem, Aerospace & Defence, AI, IoT, Fintech, Cybersecurity and Hi-Tech Manufacturing & Consumer Goods. Also, a comprehensive eco-system is being created in thrust areas like green ammonia, fuel cell, battery storage and electric vehicles manufacturing industries. All these efforts combined can exponentially fuel the state’s potential for attracting investments and the Vibrant Gujarat Summit is an excellent platform to showcase the vision and welcome investors on the back of conducive policies and robust infrastructure that Gujarat has to offer.
I am looking forward to participating in the 10th edition of the Vibrant Gujarat Global Summit scheduled in January 2024. Yet again, the state will be a melting pot of stakeholders from across the country, and around the world, discussing the potential and exploring relevant partnerships.
I believe that by spreading its vibrancy at the state, national and international level, Gujarat’s success will be the cornerstone for building a promising future for itself and the country, at large.
Chief Executive Officer, KPMG in India
Source : ET