If you think Bengaluru, Delhi and Pune are the only hot spots for your business investment, be it in Information Technology (IT) or Electronics System Designing and Manufacturing (ESDM) sector, you are widely mistaken as Jharkhand too is all set to grab your attention, thanks to the state government’s policies.
While Jharkhand is not yet prominently visible in the list of top IT and ESDM destinations of India, the state government is slowly gearing up for the same. With its two-year-old policies in place and some of them in progress to be implemented, Jharkhand’s Department of IT and E-Governance is making sure that the state becomes one of the recognised hubs for IT, ESDM and start-up sectors by the beginning of the next fiscal year – 2019.
Sreemoyee Chatterjee from electronicsb2b.com had a recent interaction with Umesh Prasad Sah, director at the IT and E-Governance Department, Government of Jharkhand, who has shed light on the real-life implementation of these policies and the benefits enjoyed by India’s electronics and IT industries. Excerpts follow …
Q) Shed some light on the policies of IT and E-Governance Department, Government of Jharkhand.
In the year 2016, Government of Jharkhand had announced four different policies – IT and ITeS Policy, BPO/BPM Policy, ESDM Policy and Startup Policy under the department of IT and E-Governance. While all these four policies have different aims and objectives respectively, they do share a common goal – of placing Jharkhand on India’s IT, ESDM and startup map at par with the other leading cities like Bangalore, New Delhi, Pune and more.
Q) What are the salient features and focus areas of IT and ITeS Policy?
The IT and ITeS or Information Technology Enabled Service Policy aims in making Jharkhand a globally competitive IT and ITeS destination along with promoting faster, sustainable investment environment, inclusive growth and employment in the state, as stated in the draft policy. In real-life we are aiming to promote Ranchi and other Tier-2 cities as alternative IT destinations and offer quality IT infrastructure to all Tier-2 and Tier-3 cities in the state. This policy also focuses on setting up of IT infrastructure like IT Parks, IT Special Economic Zones (SEZs), IT cities thereby efficiently contributing to the IT industry as well as to the life of citizens in the state.
Q) Shed some light on the real-life implementation of IT and ITeS Policy. Has there been any improvement in business?
Although the policy is at a nascent stage and is just two-year-old, we have started receiving an amazing response from several companies. Considering good IT companies need more space, manpower and a quality infrastructure, we are preparing the state to cater to all these demands. In fact, the companies themselves are eager to build their infrastructure in Jharkhand. The state’s own Software Technology Power Building (STPB) has already accommodated a couple of companies. Around 10 to 15 IT companies will start business in Jharkhand by the end of the current year, 2018.
It is too early to talk about improvement in business. All we can say is while there was almost no business at all in IT and ITeS sector, now the business has begun and very soon we will have a promising turnover.
Q) What about the ESDM Policy in your state? How will it help India improve the ESDM sector?
We consider Electronics System Design and Manufacturing (ESDM) Policy to be the most important among all as it aims to play an efficient role in improving the ESDM sector in India, which at present, needs more attention. The objectives of this policy include starting at least 50 ESDM assembly or manufacturing units in the next decade, building a strong chain of supply line for raw materials, parts and electronic components for manufacture, facilitating export of ESDM goods from Jharkhand and contributing to around US$ 2 billion out of the export target worth US$ 80 billion by 2020.
Protecting intellectual priority rights, strengthening the protection of intellectual property through reforms, reducing patent litigation and enhancing trade secret protection, increasing availability of skilled and semi-skilled manpower via apprenticeship and special vocational training in ESDM assembly are among other aims of this policy. Under this policy, the Jharkhand government is providing subsidised land and power to the manufacturing companies. To increase employment rate in the state, we are offering up to Rs 20,000 reimbursement to every employee of a company that is using Jharkhand’s manpower.
Q) What is the real-life picture of ESDM Policy at present? How successfully has it been implemented in the last two years?
Although we have not received much response from fresh companies in ESDM sector, several already established companies have taken keen interest to come up with their manufacturing units in Jharkhand under the privileges of our ESDM Policy. At the same time, we are also creating an electronics manufacturing cluster in Jamshedpur and the policy has dedicated 10 lakh square feet area to it. The work is under progress and is expected to get over by the end of this year.
15 to 20 companies will be accommodated in this cluster, exclusively committed towards manufacturing ‘Made in India’ electronics chips. These companies are willing to create and extend their market from the Jharkhand base to the Eastern and North-Eastern states of our country, which are usually not explored for business investment in ESDM sector. Also, we already have four Jharkhand based companies with branches in the US and Europe that will extend their units in the new cluster. Although we do not treat fresh and established companies differently, the well-known names are becoming an attraction for the fresher companies in Jharkhand.
Q) Has there been any improvement in the annual turnover of ESDM sector in Jharkhand since the policy implementation?
Two to three companies have started their businesses in the field of product design. However, manufacturing has not begun yet as it requires more space and well equipped infrastructure, which will take some time to fall into place. Interestingly, we have seen an annual turnover of Rs 10 to Rs 15 crores that is pretty much decent at the start.
Q) Let us know about the Startup Policy of Jharkhand
Just as cities like Bengaluru and Delhi have done great in the field of startup, we would like to see Jharkhand do parallel with them. Our Startup Policy aims to provide one lakh square feet area dedicated to incubation space for end-to-end support to the startups in the state, create fund of funds (FOF) via public-private-partnership (PPP) for promoting these startups, facilitate operations of at least 100 startups based on new end technology catering to general social needs and other needs of the state, come up with a robust academia-industry connect platform and encourage entrepreneurship in educational institutions across the state on a wide scale.
Q) How much of the Startup Policy has been implemented in real-life?
Under this policy, we are preparing Jharkhand to provide both financial and mentoring support to the startups willing to establish their base in our state. While we have come up with Jharkhand Innovation Lab with the support of Indian Institute of Management (IIM), Ahmedabad to back new startups, we have also realised that this whole startup culture and concept is very new for Jharkhand given till now mostly the bigger cities have tried their hands on it.
We do not have much of an idea on how to improve and modify the design and model. The startup ecosystem is at its infancy but is gradually picking up. We have received 40 to 50 startup ideas from several groups. While some have been approved, some are in line to get approvals from the state government. We are planning to build a startup hub in Ranchi and help institutes promote startup culture within the respective campuses. We are confident that very soon Jharkhand too will become one of the reputed destinations for investment in startups.
Q) Are these policies helping Jharkhand to become a smart city as well?Smart city needs smart equipment, the most prominent of which is IoT (Internet of Things) devices. However, Jharkhand still does not IoT devices by itself. Evidently, we are focusing specifically on startups willing to work on IoT devices, services and solutions. Some of the IoT based startups have shown interest and already applied for an IoT hub or centre in the state. Although it has not yet been materialised, we are discussing about the same for a positive outcome. It is taking some time to convince these IoT based startups to invest in Jharkhand because to them Bangalore, Delhi and Pune are the preferred choice.
Q) Are you planning to come up with an IoT Policy as well?
We already have framed an IoT Policy to improve the eco-structure and promote IoT based companies. However, it is still on discussion stage and the draft has been circulated among various stakeholders for final approval.