Powering ahead

A proactive, business-friendly government, great location and sound macro fundamentals are powering Haryana's economic surge. This is not the kind of news that makes for banner headlines. So, it was no surprise to find the news on Gurugram, the commercial capital of Haryana, getting an International Arbitration Centre (IAC) buried in the inside pages of most newspapers. The city, part of the National Capital Region (NCR) and till recently known as Gurgaon, will be the second Indian city after Mumbai to get an IAC. The Punjab and Haryana High Court, whose approval is necessary, has given its consent and sent the proposal to the Haryana government. Gurugram, which has been dubbed India's Millennium City, is home to more than half of all Fortune 500 companies that currently take their arbitration cases to the IAC's Singapore and London branches for resolution of disputes. "Gurgaon has offices of a large number of multinational companies and setting up IAC in the city will be more cost-effective and less time consuming for business houses," Harnam Singh Thakur, District & Sessions Judge, Gurgaon, was quoted as saying. Start-up haven Gurugram, which has several monikers, including India's pub capital, is also a magnet for start-ups, as home to India's fourth largest number of such companies. Not surprisingly, Bengaluru, India's Silicon Valley, leads the way with 3,641 start-ups, followed by Mumbai with 2317, Delhi with 1,958 and Gurgaon, with 1,476, according to Xeler8, an online start-up and investor database. Several well-known Indian start-ups, including several unicorns, call Gurugram home. They include MakemyTrip, ShopClues, Oyo Rooms, Urban Clap, Zomato, YepMe, Ixigo and Delhivery. "(Start-ups in) Gurgaon received $1.02 billion across 134 deals in 2016, compared to $1.19 billion across 121 deals in 2015," Rishabh Lawani, founder of Xeler8, told the media. What makes Gurugram so attractive to the start-up community, entrepreneurs, executives and employers are its young, vibrant and cosmopolitan demographic mix, the presence of several Indian and multinational companies, which are vendors and customers of these start-ups, and easy access to domestic and foreign investors. Real estate hub Gurugram comes immediately to mind when one mentions Haryana and business in the same breath, but the state is a lot more than just its commercial showpiece. The Dalian Wanda Group, one of China's largest real estate companies, has recently signed a memorandum of understanding (MoU) with the Haryana government to develop Wanda Industrial New City at an investment of $10 billion over the next decade - the single largest investment proposal received from any Chinese company. The proposal includes the construction of industrial townships and retail and residential buildings. Construction of Phase-I of the project, spread over 1,300 acres, is expected to start soon. Another MoU signed between China Fortune Land Development Company Private Limited (CFLD), another large Chinese developer, and the Government of Haryana, envisages building lare industrial parks in the state. Detroit of India When Suzuki Motor Company (SMC) first set up its factory in the then sleepy town of Manesar in Haryana, on the outskirts of Delhi, to assemble 40,000 cars for the Indian market, it couldn't possibly have imagined that in three decades, that relatively small plant would grow to the point that it would outstrip the production of its parent in Japan. Today, Maruti Suzuki Ltd, a subsidiary of SMC, produces more cars than its parent, is more valuable than its parent on a standalone basis and not only serves the Indian market but is also the hub for SMC's export thrust to West Asia, Africa, Europe and South America. Then, Hero MotoCorp, the world's largest maker of motorcycles, also has a factory not very far from Maruti's plant, earning Haryana comparisons with Detroit, the erstwhile hub of the once dominant US auto industry. Today, Haryana produces 75 per cent of passenger cars, 60 per cent of all motorcycles and 50 per cent of tractors made in India. Maruti, Hero and many of their vendors and suppliers have their factories and establishments in Haryana, thus, presenting investors, including existing ones, with a readymade eco-system for automobile R&D and production. Focus on textiles Having industrialised a previously agrarian state over the last three decades, the state government is now looking at new avenues to fuel growth. It recently announced the Textile Policy 2017 to encourage investments in new units and to ensure the modernisation and growth of existing textile units. The policy, which offers several financial and tax incentives, encourages setting up of textile parks and skills development and has set a goal of attracting Rs 5,000 crore ($800 million) investments and creating 50,000 new jobs in the state. "(The policy) has been formulated with an eye on the cotton belt of Haryana. The state is one of the leading cotton producers in the country .... This sector provides employment to about one million people and readymade garments worth $2 billion are exported from the state annually," ä government spokesperson said. Pulling out all stops Haryana, which is already among India's most industrialised states, has signed MoUs worth Rs 5.84 lakh crore ($90 billion) with investors in sectors as varied as auto, auto components and light engineering, agro & food processing, aerospace & defence, manufacturing, real estate, energy, Infrastructure, electronics, IT & ITES, textiles, etc., at a recently held Global Investors Summit. "To facilitate implementation of the projects, land will be made available from the developed land bank. The HSIIDC has also started the system of online geo-referenced display to provide investors information on vacant lands in industrial estates,” Haryana Chief Minister Manohar Lal said at a press conference following the summit. Good location, sound macro fundamentals As mentioned above, Haryana is a leading industrial state in India. What is less well known is that it ranks third among states in IT and ITES exports. It is also the second largest contributor of foodgrains to the Government of India's central poll and accounts for 60 per cent of Basmati rice exports. In the 11 years between 2004-05 and 2015-16, Haryana's gross state domestic product (GSDP) expanded at a compound annual growth rate (CAGR) of 12.12 per cent to $75.3 billion while its net state domestic product (NSDP) expanded at a CAGR of 11.75 per cent to $71.6 billion. The state has invested in the development of world class infrastructure facilities such as special economic zones (SEZs), Kundli-Manesar-Palwal (KMP) global corridor and Delhi- Mumbai Industrial Corridor (DMIC). Haryana enjoys a locational advantage, with nearly one-third of the state's area under the National Capital Region (NCR). The state offers a wide range of fiscal and policy incentives for businesses under the Industrial and Investment Policy, 2011. Moreover, it has sector-specific policies, particularly for IT and tourism. The following are some of the initiatives taken by the state to encourage rapid industrialisation and fast growth

• HSIIDC has developed a number of industrial estates, industrial model townships and specialised parks for cluster development.
• An industrial model township is under-construction at Manesar, near Gurgaon. The region is being developed as an automotive and engineering hub.
• The government is developing sector-specific theme parks and sub-cities along the KMP Expressway.
• Single-window clearance mechanism was established under the Haryana Industrial Promotion Act, 2005
• The state government acquired 1,000 acres of land for a dedicated pharma park in the KMP Express Global Economic Corridor.
• The International Centre for Automotive Technology has been set up at Manesar as part of the National Automotive Testing and R&D Infrastructure Project. It provides testing and R&D services to the industry.
• As of July 2016, the state had seven operational SEZs, 23 formally approved SEZs, three SEZs with principal approval and 20 notified SEZs.
• The state government has proposed a sliding railway and logistic centre in IMT Manesar for smoother transportation and more effective inventory management.
• Haryana is the first state to have implemented its State Wide Area Network (SWAN) for voice, data and video transmission.
• The government has granted licenses to 50 proposals for establishment of IT/cyber projects as of August 2015.
• The state government has established a Regional Centre for Biotechnology (RCB), Gurgaon under the guidance of UNESCO as a Category II Centre.