Big companies queuing up to invest in Uttarakhand

By Vipin Agnihotri

Big companies such as Tata Motors, Bajaj Auto, Hero Honda, Ashok Leyland and Nestle are queuing up to invest in the state of Uttarakhand. In terms of statistics these companies have invested around Rs 30,000 crore in the state since 2003.

The irony is that state doesn’t have any more land in industrial estates. There is a long waiting list of companies, but state can’t accommodate everyone. If experts are to be believed, the industrial estates of Haridwar, Udham Singh Nagar and Dehradun have emerged as the main industrial centres.

In the last few years, Uttarakhand has clocked a state domestic product growth rate of 10 percent, placing it among the high growth states in the country. In my recent visit to Uttarakhand I notice that State Infrastructure and Industrial Development Corporation (SIDCUL) has most utilized unused government land for the purpose. The supply of such parcels of land has now run out.

Because of this, government can either turn away investors, or it can start doling out agricultural land. Initial signs are that government will divide land into three categories. First and foremost is the extremely fertile land, which they will not touch. Second one is the ordinary land. Last one being the government land. On the basis of what kind of Industries state needs, government will decide whether to give it to companies or not.

On other fronts, too, there are challenges that need to be addressed. In my opinion, basic infrastructure needs an urgent overhaul. No one will argue with the fact that the supply of power has not kept pace with demand in Uttarakhand. At this moment of time, the state generates 950 MW of power, against a peak demand of 1,200-1,300 MW. An investment of Rs 11,000 crore is expected to be made in the sector over the next few years to ramp this up to 3,500 MW.

In addition, there is an Rs 2,200 crore ADB funded project to overhaul and build roads in the state. The states urban centres also need large doses of investment. The lack of trained manpower is another issue. The government is working overtime to address this by inviting companies to adopt Industrial Training Institutes.

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HDFC Bank to go Rural

By Vipin Agnihotri

HDFC is chartering an aggressive expansion plan to leave footprints in all districts in the most populous state of the country, Uttar Pradesh in a phased manner. The bank is all set to come up with hub and spoke model to reach out to its prospective rural clients. Neena Singh, executive vice president of the bank pointed this out in an exclusive chat to The India Street.

“At the first stage it will have a full fledged branch (the hub) equipped to deal with the needs of the rural economy. At the next stage (the spokes) are designed to reach out to its clients in the villages across the country,” she said.

“We had an agri meet today to apprise our agri-relationship managers on the ways to milk the catchment areas in Uttar Pradesh and Uttarakhand,” pointed out Neena Singh. A detailed plan aimed at strong rural presence was being chalked out. In this financial year, the bank would be expanding presence in 19 districts in the state, she added.

At the next stage of its rural operation, Singh said, the bank was planning point of sale machines, capable of cash deposits and withdrawals and it was also allowing its clients a limited number of free transactions through ATMs of associated co-operative banks and public sector banks.

"Another step is our decision to take the more demanding route of connecting with clients directly, rather than taking the easier direct sales agent route. Agri extension education camps will be held in districts to increase farmer’s awareness of our products and also of farm equipment, yield efficiency, farm machinery and other inputs of importance for farmers," she said.

It is worth mentioning in this regard that specific rural products have been planned like tractor loans, kisan gold cards and warehouse receipts. HDFC bank’s rural clients would also be given nearly all the urban-centric banking products including savings account, fixed deposits, automobile loans, foreign exchange facilities and loans against gold.

And the rural rich population will get wealth management solutions, mutual fund products and stocks and commodities trading facility by the bank. The bank’s employees will also be trained to offer investment advice to its rural clients.