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MP
Gearing Up to be
India's IT Central Hub
By
Anurag Jain
India's central State of
Madhya Pradesh, offering the best
possible connectivity, infrastructure
facilities in communication and
matching investment incentives is
gearing up to emerge as a hub of
the Information Technology industry
in the country. Anurag Jain, Secretary
in the Chief Minister's office looking
after the Department of IT and who
is also the CEO of MAP_IT gives
a detailed account of a revitalized
IT Policy of the State Government.
Madhya Pradesh, the second largest
state is located in the very heart
of the country. It has a population
of over 50 million and is easily
accessible from every corner of
the country. From agriculture to
natural resources, industry, power
and people, M.P. has abundant potential.
Madhya Pradesh government had announced
its IT policy in 1999. It was revitalized
in 2006 and a new IT policy was
launched with fresh aspirations
and willingness to bring in a revolution
in e- governance and induce IT investments
in the state.
IT Policy - Action Plan
The broad vision of the State in
the Information Technology sector
is summarized as follows:
“Madhya Pradesh will
use Information Technology to achieve
the following:
• Improve the life of the
common man leveraging the strengths
of e-Governance
• Attracting investment into
the sector so that the educated
youth are able to contribute to
the development of the State
• Create a pool of highly
skilled professionals who are at
par with the best in the country.
• Transforming the Resource-Based
Economy to a Knowledge-Based Economy.
The four pillars that govern the
foundation of the State's IT Policy
are:
(A) E-Governance
(B) Attracting IT Industry
(C) IT Education - [HR Policy]
(D) Common Infrastructure
(A) E-Governance:
With increasing literacy, citizens
demand better services from the
government, in the shortest time,
at the place of their choice and
in a transparent and non-discriminatory
manner. The Madhya Pradesh Government
focuses on e- Governance through:
Websites & Content Creation:
“All the web sites of the
state will be in both English as
well as Hindi, in Unicode Fonts,
common look and feel and with content
relevant to the user group the site
is intended for”. The following
shall be the actionable points:
1. Department of Information Technology
will develop a common template for
websites within one month of the
promulgation of the policy.
2. All Departments, using the templates
and suggestion of Department of
IT should reconstruct their sites
in English and Hindi with content
relevant for the user groups. Departments
shall be responsible for updation
of their site and will appoint a
Webmaster for this purpose.
3. A committee under the chairmanship
of the Chief Secretary shall review
the progress within six months.
E-Governance Projects:
The Central Government is funding
10 mission mode projects of the
state that pertain to the following
departments; Land Records, Transport,
Police, Treasuries, Property Registration,
Employment Exchange, Agriculture,
Municipalities, Gram Panchayat,
Commercial Taxes. More departments
to be covered by State's initiatives
are Forest, Horticulture, Health
etc. The Departments that are not
in this list shall be computerised
by State's own resources.
E-Governance projects shall be funded
as follows:
1. These projects will be long term
(10 to 15 years). Joint Venture
of CMM level 5 companies and Empanelled
Vendors of the State will be allowed
to bid for the project. Madhya Pradesh
State Electronics Development Corporation
and MAP-IT will empanel the Vendors
of the State, after the approval
of a committee headed by the Chief
Secretary. The Department of Information
Technology will provide consultants
for preparing Request for Proposal
(RFP) and Detailed Project Report
(DPR). The concerned Department
will follow transparent procedure
for selecting System Integrator
(SI). The SI will provide hardware,
software, proprietary software,
manpower, customised software and
maintenance.
a. Projects where user charges can
be levied will be funded under the
public private partnership principles.
Projects such as Lumbering Operation
MIS of the Forest Department, e-Procurement
/ e-Tendering and computerisation
of the Collectors' office are good
examples.
b. Adequate funds will be provided
for computerisation of those departments
submitting a project proposal. The
proposal must include provision
for improving systems, processes
and procedures.
2. Some Departments are getting
funds through externally aided projects
or from the Central line Ministries
(Water Resources, Urban Local Bodies,
Police etc). These departments will
get their projects sanctioned from
the respective Agency.
3. Departments will actively discourage
the use of pirated software. Department
of IT will enter into select agreements
with major software companies so
that lowest prices can be negotiated.
4. All the Departments in one month
from the date the policy is promulgated
will undertake the exercise of identifying
funding source. The high power committee
under the chairmanship of the Chief
Secretary will review the progress.
5. Evaluation of IT Projects will
be based on a two-stage evaluation
process. The first stage will be
prequalification in which the quality
of the bidding companies will be
assessed. Price bids of only those
companies shall be opened who are
approved in the prequalification
stage.
(B) Attracting IT Industry:
a. The industry grew in tier I cities
such as Bangalore, Hyderabad, Chennai
and Delhi. Due to congestion and
infrastructural problems it has
started looking at tier II cities
such as Pune, Chandigarh, Bhubaneswar
and Nagpur for expanding operations
and reducing costs. The State plans
to capitalize on this development
and promote investment in Indore,
Gwalior, Bhopal and Jabalpur. To
attract the IT industry and to develop
private IT parks, following will
be the course of action:
i. Software, Business Process Outsourcing
(BPO), Information Technology Enabled
Services (ITES) and Computer Hardware
(as described in the notification
number F-16-8-eleven-D-99 dated
28-01-2000 of the Industries Department)
will qualify as the Information
Technology Industry.
ii. Large chunks of land (Preferably
more than 100 acres) near the Airports
of the above four cities will be
earmarked by the State for Information
Technology investment area. Composite
townships with food courts, hospitals,
shopping malls, residential complexes,
schools, five star hotels, and other
entertainment facilities for the
software professionals will be allowed
in these areas. Land earmarked for
this purpose will not be diverted
for any other purpose without the
consent of the high power committee
under the chairmanship of the Chief
Secretary.
iii. The State Government or its
agencies will not undertake construction
on their own in the IT investment
area. Suitable private sector infrastructure
development agencies will be identified
who will undertake the development,
marketing and management of the
IT investment area. The State or
its agency will only be a facilitator
or a minority partner in the Special
Purpose Vehicle.
iv. The Government will facilitate
acquisition of private land in accordance
with land acquisition act for development
of IT investment area by leading
and reputed private sector companies
who posses experience of making
sizable investment in this sector.
v. Incentives by the Government
of Madhya Pradesh
Incentive to the Industry:
1. All incentives provided under
the Industrial Policy shall be applicable
to the IT Industries established
on Government allotted land/private
land with a provision of single
window processing/clearances for
all government formalities.
2. The Government shall reimburse
prospectively, 30 percent of the
cost incurred by an IT Company operating
in the State and employing more
than 100 people, on securing quality
certification of Capability Maturity
Model (CMM/CMMi) Peoples Capability
Maturity Model (PCMM) level 3 and
above, subject to a maximum ceiling
of four lakhs. This incentive will
be available only once to the applicant
company.
3. Exemptions up-to twice the existing
FAR for entire IT investment area.
4. Stamp duty payable by IT companies
on mortgage/ hypothecation with
banks/financial institutions in
IT investment area will be exempted
provided the new unit is certified
to be an IT outfit by a designated
agency.
5. Stamp duty and registration fee
exemption will be applicable on
Sale/lease by financial institutions/
Government Agencies/ Pvt. Sector
companies which acquire space/premises
in the IT investment area for subsequent
lease to IT units provided the new
unit is certified to be an IT outfit
by a designated agency.
6. Rate of property tax in the IT
investment area will be at par with
residential premises.
7. No prior permission will be required
for installation of captive power
plant.
8. Rebate in Cost of Land is being
included as one of the major incentives
for attracting investments in the
state. IT companies establishing
the facilities can avail rebate
in the cost of land linked to employment.
The terms for allotting land and
the procedure for availing the rebate
is defined below:
a) Rebate shall be applicable only
on Government lands and land belonging
to Development Authorities/ Government
owned Corporation.
b) Rebate shall be restricted to
Rs. 25,000/- per job created in
the unit.
Or
The applicant companies proposing
to have fixed capital investment
(excluding working capital) of Rs
10 Crore and above will have the
option of land at the rate of 25%
of the prevalent premium, subject
to availability of land and with
the condition that the investment
in fixed capital will be made within
a period of three years. Land to
such units will be allotted according
to the table given below:
a) Minimum number of employees hired
by a company in order to avail the
concession shall be 100.
b) Company taking concession will
have to continue operation for two
years
c) Companies providing employment
to more than 500 persons will be
provided further concession on rate
of land. The Cabinet Committee formed
for implementation of this policy
shall take decision in this regard.
d) Land will be allotted for 33
years on lease with provision for
further renewal. A minimum 60% of
the total of the IT investment area
will be used for IT operations and
the balance 40% can be used for
ancillary use and support services.
The area so developed should have
facility to create at least 350
jobs per acre.
2. IT Industry shall be provided
power through a dedicated feeder.
3. Exemption from Factories Act,
Maternity Act, Contract Labour Act,
Payment of Wages Act, Minimum Wages
Act, ESI Act.
4. Exemption from electricity duty
tax, entry tax and work contract
tax.
5. IT units in IT investment area
will be exempted from payment of
Octroi, entry tax and local bodies
tax for all capital goods and raw
material purchased by them.
6. All incentives will be for five
years from the date the IT unit
becomes operational.
7. Companies establishing IT industries
in the state shall be entitled to
Special Economic Zone (SEZ) status
under the Central Government provisions.
8. Companies providing employment
to more than 250 people in the state
will get preference of 10% marks
in the prequalification stage of
the bidding process of IT procurement.
( C ) IT Education - [HR
Policy]
Madhya Pradesh has been able to
produce a large number of graduate
engineers in IT and computer sciences.
Presently the state has more than
60 engineering colleges. Graduates
from these colleges are not able
to fulfill the needs of the industry.
There is a need to upgrade their
skills and make the manpower compatible
with the industry requirement. The
present government schooling system
is not producing manpower, which
can fulfill the requirement of BPO
and ITES. NASSCOM in consultation
with a leading IT consultant, KPMG
has published a report that predicts
the pattern of IT manpower requirement
in the next five years. It is indicated
that these two sectors will be requiring
2.1 million people. This sector
requires keyboard skills, Internet
browsing skills; ability to work
on office packages, data entry and
knowledge of the laws of the client
country and their procedures In
view of the description given above,
the following is proposed to be
undertaken during the Policy implementation
period:
1. Selected 500 government schools
will be provided modern computing
hardware, software and Internet
connectivity. These centers will
produce students equipped for taking
jobs in the BPO/ITES sectors. Department
of School Education in consultation
with the state IT Department, IT
Industry, other concerned departments
and groups will prepare a course
curriculum to be taught in these
schools. The School Education Department
will promote teaching computers
and technology in these schools.
2. To improve the standard of IT
education in the engineering colleges
and Government Colleges to make
our graduates employable, centres
of excellence will be established
in all Government engineering colleges
and selected Government colleges.
The State would invite large reputed
companies to teach technology and
provide their certification in these
centres.
3. English language teaching will
be promoted in school education.
4. A Centre for E-governance will
be established in Bhopal, which
will allow engineering graduates
from the IT field to work on live
E-governance projects. These centres
will be based on a spectrum of technologies
that would include proprietary as
well as open source. Noted IT professionals
would man these centres. The Department
of IT will submit a Detailed Project
Report [DPR] within six months from
the announcement of the Policy.
( D ) Common Infrastructure
i. Common infrastructure such as
State Wide Area Network [SWAN],
Natural Resource Management [GIS
based], Data Centre, Disaster Recovery
Sites and Inter Operability Standards
are required so that all the departments
are able to utilize these services
without bothering about the maintenance
of these complex facilities.
Building Investment Opportunities
& Creating Positive Vibes to
Attract Investors to the State of
Madhya Pradesh IT SEZ
Madhya Pradesh is one of the fast
growing destinations for the investments
in the field of Information Technology.
NASSCOM AT Kearney Report reconfirms
the Investment Destination as Madhya
Pradesh.
Madhya Pradesh is bestowed with
excellent location conditions, bordering
seven Indian states which allow
easy access to other parts of the
country. Availability of resources,
well developed infrastructure, availability
of trained and skilled manpower
in abundance, a peaceful law and
order situation are some of the
factors which are conducive to favorable
environment for influencing investment
decisions and attracting investments.
Madhya Pradesh scores high on all
these counts. Also, the Government
of Madhya Pradesh has ambitious
plans to develop and upgrade the
state's road, rail and air connectivity.
The IT sector provides immense opportunities
for motivating flow of investments
into the State. Madhya Pradesh is
making remarkable achievements in
promoting IT in Government as well
as private areas, which includes
e-governance, computerization in
Government departments and various
IT related activities for rural
areas. In Madhya Pradesh IT has
improved the citizen-government
interface and made it more transparent,
efficient and effective.
Emergence of IT has opened new vistas
of investment opportunity and to
its support; the State Government
has revitalized its IT policy in
the Year 2006 to attract private
investment in the IT sector.
Several companies have evinced interest
to invest in the State. Besides,
the Government is in process of
setting up of Software Technology
Parks at Bhopal, Indore and Gwalior
so as to provide the necessary infrastructure
for IT companies. A brief detail
about the new IT infrastructure
is stated as below:
1. 11 IT SEZs “Formal approval”
granted by BOA.
• 4 in Government and 7 in
private sector
2. IT SEZs proposed in Bhopal, Indore
and Jabalpur [Public Private Partnership]
• 4 million square feet of
quality office space to be developed
in Bhopal, 1 millon each in Gwalior
and Jabalpur
• Support facilities like
5-star hotels, shopping malls, food
courts, residential houses, etc.
to be built
Bhopal
• IT SEZ area in 180 acres
of land at village Badwai near airport.
• Compact Disc Limited Chandigarh,
allotted five acres of land
• Underhills Technology, New
Jersey, USA allotted 10 acre of
land
• Netlink Infotech Ltd., allotted
10 acres of land
• STPI allotted three acres
of land for an Incubation Centre.
• SEZ Developer identified,
LOI issued to UNITECH
Jabalpur
• 90 acres of Govt land for
IT SEZ 15 km away from the Airport.
• Essar Group proposing to
set up their BPO (ITES) centre.
• One million square feet
of quality office space to be developed.
• Identification of developer
in process
Gwalior
• 30 acres of Government land
for IT SEZ barely 10 km from the
Airport
• STPI allotted three acres
of land for incubation centre.
• 80,000 sq. ft area ready
to occupy near SEZ
• One million square feet
of quality office space to be developed.
• Identification of developer
in process
“Investment is pouring in
this sector and the economy &
infrastructure fundamentals are
proving to be robust and perfect.
Investors are sure to make the most
of this great opportunity. This
is just the tip of the iceberg;
Madhya Pradesh is on war footing
to be a winner.”
Author is Secretary Information
Technology, Madhya Pradesh Government
and can be contacted at jain.anurag@mp.nic.in
or call +91 755 2441062 |
