Setting up a Capacitors, Switchgear & Control Panel Manufacturing Unit Heavy Engineering Government of Gujarat
Contents Project Concept
3
Market Potential
5
Growth Drivers
6
Gujarat – Competitive Advantage
7
Project Information
9
- Location/ Size - Infrastructure Availability/ Connectivity - Raw Material/ Manpower - Key Players/ Machinery Suppliers - Potential collaboration opportunities - Key Notes
Project Financials
15
Approvals & Incentives
17
Page 2
Project Concept Switchgears, control panels and capacitors overview ►
Switchgears and control panels form a part of power distribution equipment and are widely used in power grid or electricity distribution systems. ►
►
Low-voltage and medium-voltage switchgear are used in many industries such as oil and gas, and paper and pulp, while high-voltage switchgears are primarily used in power substations.
Capacitors are widely used as parts of electrical circuits in many common electrical devices and also in power distribution systems. Transmission equipment
Generation equipment
►
Boilers
►
Turbines
►
Generator
►
►
►
High voltage (HV) (>36 Kv) Medium voltage (1kv to 36Kv) Low voltage (<1 Kv)
►
►
►
►
Types of HV switchgears: Air-insulated ► Gas-insulated ► Oil-insulated ► Vacuum-insulated ►
Transformers
►
Switchgears
►
Transmission line towers
►
Control panels
►
Capacitors
►
Wires and cables
Conductors
Control panels/gears
Include devices such as circuit breakers, protective relays and fuses that enables the continuous electric current transfer and protection against current overload, short circuit, and insulation failure. Types – by voltage range ►
►
►
Switchgears
Distribution equipment
►
Control panels/gears comprise a casing or console that holds the switches, metres, safety equipment, indicators and warning systems to control or monitor a specific device or a process. They are mostly an integrated part of switchgears and are equipped with push buttons and analogue instruments Touchscreen control panels are also gaining popularity.
Capacitors ►
►
►
Capacitor is a key passive electrical component used to store energy in electrical and electronic equipment or devices. Capacitors help to improve the overall power factor (PF) of the system and form an important part of an energy efficient system. They are widely used in consumer electronics, telecom devices, IT hardware and power distribution systems.
The project involves establishing a facility in Gujarat to manufacture switchgear, control gear and capacitors for a variety of applications. Sources: “Assemblies of switchgear and control panels (1)” EEP (June 2012), http://electrical -engineering-portal.com/assemblies-of-switchgearand-control-panels-part-1
Page 3
Project Concept Project overview ►
The proposed project involves the establishment of a facility for manufacturing of capacitors, switchgear and control panel at Dahej Industrial Estate, Bharuch District
►
The proposed facility will have three main manufacturing processes, namely, Switchgear & control gear manufacturing, and Capacitor Manufacturing process
►
The key equipment required for switchgear and control gear manufacturing include – LVD laser cutting machine, turret punching machine, gasket forming machine, metal bending machine, etc.
►
Key equipment required for capacitor manufacturing process include – capacitor winding machine, lead welding machine, and box encapsulation machines
►
The total project cost of setting up the facility and control panel manufacturing facility is estimated to be ~INR 1350 million
►
The demand for the facility will be met by the significant capacity addition requirements in the State and overall country. The expected growth in electricity generation capacity (GW) is likely to grow at a CAGR of 7.8% between 2016-25
► A
strong local demand will also produce significant demand for T&D equipment
Page 4
Market Potential Global switchgear and control gear (panel), and capacitor markets expected to grow at CAGRs of 6.1% (2014-19) and 5.1% (2015-20), respectively Global switchgear and control gear market size (USD billion) CAGR: 6.1%
40.0
2014
Global capacitors market size (USD billion) CAGR: 5.1%
53.8
CAGR: 3.2%
42.1
24.2
18.8
16.1
2015 2019F Source: Technavio
2010 2015 2020F ► Source: Paumanok Publications
► Asia
►
Pacific is the largest switchgear and control gear market and is expected to rise strongly owing to large investments in the power sector during 2016 –2019. ► Increasing electrification in developing countries of this region will boost demand. Growing demand for consumer electronics and the rising significance of capacitors in electronics manufacturing is likely to drive the capacitors market to ~USD24 billion by 2020.
Indian switchgear and capacitor markets to witness robust CAGRs of 19.2% and 29.2%, respectively, during FY15-22 Indian switchgear and control gear market size (USD billion)
Indian capacitors market size (USD million)
450 CAGR: 19.2%
8.2
CAGR: 29.2%
4.4 2.4
FY15 FY17F FY22F Source: Ministry of Heavy Industries, TechSci Research ►
►
150 75 FY15
FY17F
FY22F
Source: Central Electricity Authority of India
The switchgear and control gear market is expected to witness robust growth owing to significant electricity capacity additions supported by large government and foreign investments. Demand for capacitors is expected to be driven by rising demand for consumer durables, IT hardware coupled with increasing use of electrical circuits in diverse applications.
Source: “GLOBAL T&D EQUIPMENT MARKET”, Technavio (Sep 2015), accessed via EMIS Database “EEStor Capacitor Technology: Opportunities in The Global Capacitor Market: 2014”, PAUMANOK PUBLICATIONS, INC. (December 2014 ) “ENGINEERING Sector profile” IBEF (January 2016) “Indian Electrical Equipment Industry Mission Plan 2012- 2022”, Ministry of Heavy Industries & Public Enterprises Government of In dia (July 2013)
Page 5
Growth Drivers Significant electricity capacity additions supported by government investments will drive demand for switchgear and control gear Expected electricity capacity additions for various five year plans (FYPs) (in GW)
88.5
Investments on distribution equipment by the Government of India (USD billion)1
93.0
Installed total capacity in India (GW)
Growth: 6.6%
78.7
CAGR: 4.0%
400
45.9 43.1
280
41.3
10th FYP 11th FYP 12th FYP 13th FYP
FY16
11th FYP 12th FYP
FY22F
Source: Indian Electrical & Electronics Manufacturers’ Association ►
Large-scale planned investments and installed capacity addition of ~220 GW during (FY16-22) will drive demand for switchgear and control gears in India to ~USD8.2 billion by FY22.
Robust demand for consumer electronics and durables will drive the capacitors market Indian electronics market (USD billion) CAGR: 6.1% 400
280
FY16 ►
►
FY22F
Indian consumer durables market (USD billion) Of the total demand of ~USD400 billion, only ~26% (USD104 billion) is expected to be produced domestically and the rest will be imported.
CAGR: 16.3%
►
20.6
9.7
FY15
By 2025, India is expected to be the fifth largest consumer durables market globally.
FY20F
Source: Makeinindia, Department Of Electronics, TechSci Research Rising disposable incomes, easy access to credit, increasing electrification and wide usability of online sales will boost domestic capacitors production capacity to USD450 million by FY22. Moreover, investments by the government will further strengthen domestic manufacturing ► In 2014-15, the government invested ~USD738,000 to set up a facility at Thrissur, Kerala for developing super capacitors and reduce dependence on imports.
Note: 1) All currency conversions at USD 1 = INR 66.66 as on 9 June 2016. Source: “Indian Electrical Equipment Industry Mission Plan 2012- 2022” “India making super capacitors for strategic use”, Business Standard (January 2016), http://www.business -standard.com/article/newsians/india-making-super-capacitors-for-strategic-use-116011700336_1.html Consumer durables include brown goods, such as TV, PCs, laptops and white goods, such as AC and refrigerators.
Page 6
Gujarat - Competitive Advantage Strong local demand Total power generation capacity in Gujarat (MW) CAGR: 9.2%
29,040
Total power transmission capacity in Gujarat (MVA)
CAGR: 47.6%
31,000
19,000
18,270 4,000
FY14
FY17F FY20F 2014 2018F Source: Energy & Petrochemicals Department, Government of Gujarat
►
Significant increase in Gujarat’s power generation and transmission capacities will generate robust demand for switchgear and control panels, which are primarily used at sub-stations for power distribution.
►
Moreover, higher focus on energy efficiency and increased capacitor usage in various devices will drive demand for capacitors.
►
Key proposed power generation projects include a 4,000 MW Mundra ultra mega power plant and a 2,640 MW Mundra thermal power plant.
Large investments by the Government of Gujarat (GoG) in the power sector Investments in power sector – by segment (USD billion)
billion1
~USD22.8 for power capacity additions The Blueprint for Infrastructure in Gujarat 2020 (BIG 2020) – an integrated plan for Infrastructure development – envisages an investment of USD22.8 billion (INR151,735 crore) in power sector.
Transmission and distribution Generation
4.6
18.2
The Government of Gujarat intends to invest USD4.6 billion (INR30,670 crore) in transmission and distribution by 2020.
Note: 1) Currency converted at USD 1 = INR 66.66 as on 9 June 2016. Source: “Review of Blueprint for Infrastructure in Gujarat (BIG 2020) – Final Report Volume 1 – Summary and Vision” (August 2009), accessed via http://www.gidb.org/Document/2014-12-31_112.pdf “Manufacturing Sector Profile”, (January 2013), http://ww w.rubberking.net/images/pdf/Manufacturing%20Sector%20Profile.pdf
Page 7
Gujarat - Competitive Advantage High availability of skilled manpower (engineers) Engineering seats in Gujarat – by specialisation (Academic year 2014-15)
►
As of June 2016, Gujarat had ~126 undergraduate engineering colleges and ~70 post graduate engineering colleges with intakes of ~68,447 and ~6,694 students per year, respectively.
►
More than 80% of the seats were in self-financed private colleges, while 15% seats were in Government colleges.
23%
Mechanical
17%
Computer Electronics & Communication
17% 14%
Civil
13%
Electrical Information Technology
8%
Others
8%
Total seats: 46,069 for admission through Gujarat Common Entrance Test
Leading engineering colleges in Gujarat: ►
Indian Institute of Technology (IIT), Gandhinagar
►
Sardar Vallabhbhai National Institute of Technology, Surat
►
Gujarat Technological University, Ahmedabad
►
Nirma University - Institute of Technology, Ahmedabad
Other advantages Ease of Doing Business ►
Only state which comply 100% with environmental procedures.
►
Gujarat fares highly when it comes to setting up a business, allotment of land and obtaining a construction permit.
Flourishing Economy Gujarat contributes 7.31% of the Nation GDP in 2015 and shows leadership in many areas of manufacturing and infrastructure sectors. ► Gujarat’s SDP (State Domestic Product) at current price registered a growth of 11% during the year 2014-15. ►
Strategic location and excellent infrastructure ►
Located on the west coast of India, Gujarat is well connected to the major cities of the world by air and sea routes.
►
The state has 45 ports, 12 domestic airports and 1 international airport in addition to an extensive rail and road network.
Easy availability of raw materials ►
Many key industrial clusters such as foundry & forgings, machine tools, steel rerolled products and fabricated metal products are located in close vicinity of industrial hubs in Vadodara.
Source: “Manufacturing Sector – Profile”, Vibrant Gujarat website “Gujarat – Growth and Prosperity for All”, Vibrant Gujarat website Ministry of Statistics and Project Implementation, August 2015
Page 8
Project Information Switchgear and control gear manufacturing process1
1. Metal sheet fabrication ► ►
► ►
Stainless steel sheets are sheared. Sheet are then bent using hydraulic press brake machines. Chemical treatment is done to remove surface defects. Lastly, doors are sealed with polyurethane rubber.
2. Enclosure assembly ►
Frames and processed metal sheets are fitted together using joints to form enclosure assemblies.
3. Busbar production ►
►
6. Component assembly
Busbars (electrical conductors) are cut, punched and bent according to the panel design and rating before being installed in the enclosures. They are clamped with fibre glass insulator for durability during short circuits.
Key equipment required
7. Testing
LVD laser cutting machine ► Turret punching machine ► Hydraulic press brake machine ► Gasket forming machine ► Epoxy powder coating machine ► Metal bending machine ► Punching and cutting machine Testing equipment ► Contact resistance tester ► Primary current injector ► Secondary current injector ► 2 phase voltage injector ►
►
Electrical components such as circuit breakers and control devices are fitted and wired together.
►
The switch gear is tested on various testing equipment to ensure optimal performance and safe operation before on-site installation.
Note: 1) The process depicted is illustrative and may involve further sub-steps and other processes as well Source: SMBE electric company website: http://www.smbelectric.com/our-capabilities/manufacturing-process/
Page 9
Project Information Capacitor manufacturing process1 1. Dielectric paste production ►
Powdered dielectric material and resin are mixed to created a dielectric paste.
3. Internal electrode printing
2. Sheet formation ►
►
The paste slurry is poured onto conveyor belt inside a drying oven, resulting in the dry ceramic sheets. Thickness of the sheet determines the voltage rating of the capacitor. Dielectric paste
Dielectric Resin powder
►
►
Electrode ink is made by mixing metal powder with solvents and ceramic material. Electrodes are then printed onto the ceramic sheets using a screen printing process.
Screen
4. Sheet layering and pressing ►
Electrode printed ceramic sheets are stacked to create a multilayer structure called a bar.
Multi-layering
Pressure
Carrier film Printed electrodes
5. Cutting and chip formation ►
The bar is cut into separate capacitors as per the specified sizes.
7. Terminal electrode dipping and plating
6. Sintering/ Firing
The parts are fired in kilns with slow moving conveyor belts. ► After sintering, the capacitors become hard ceramic. ►
► Each terminal of the capacitor is dipped in electrode ink and the parts are fired in kilns. ► After this capacitors are► plated with a layer of nickel and then a layer of tin. ►
Terminal electrode dipping
8. Testing and packaging
The parts are tested and sorted to their correct capacitance tolerances. They are then packaged on tape and reel and are shipped.
Terminal firing and plating
Key equipment required ► ► ►
Capacitor winding machines Lead welding machines Powder coating machines
Box encapsulation machines ► Automatic testing machines ►
Note: 1) The process depicted is illustrative and may involve further sub-steps and other processes as well 2) The process is for the production of ceramic capacitors that comprise majority (50-52%) of the market Source: “Manufacturing process: How TDK’s multilayer ceramic chip capacitors are made” TDK company website, http://www.tdk.co.jp/teaaa01/aaa60516.pdf “Basics of capacitors [Lesson 3] How monolithic ceramic capacitors are made”, Murata, http://www.murata.com/products/emiconfun/capacitor/2011/06/28/en-20110628-p1 “Basics of Ceramic Chip Capacitors”, Johanson Dielectrics (http: //www.johansondielectrics.com/basics -of-ceramic-chip-capacitors)
Page 10
Project Information Indicative Location: Dahej, Bharuch ►
Dahej –III in Bharuch District is an indicative location for establishment of transmission wire manufacturing plant. Alternatively, other suitable locations in Gujarat can also be considered.
►
The site is owned and managed by Gujarat Industrial Development Corporation (GIDC) and has gained traction from large T&D companies Adani Power Ltd.. Dahej, Bharuch Ahmedabad Dahej-III industrial estate: Key highlights Area Land price Focus sectors
►
1477 hectares INR 1020 per sq. m. ►
►
Chemical & Petrochemical Industries Large Industries
This kind of facility can be developed in any region / location in Gujarat.
Why Dahej? Dahej Industrial Estates – I, II, III form part of the Gujarat Petroleum Chemical Petrochemical SIR located in Bharuch ► Bharuch is a formidable industrial base in sectors as diversified as chemicals & petrochemicals, textiles, drugs and pharmaceuticals. ► The Industrial Estates and the GPCPSIR fall within the proposed Delhi Mumbai Industrial Corridor (DMIC) Dahej I: Dahej II: Dahej III ►
Scale of Industries – Large Industries ► Type of Industries – Chemical & Petrochemical Industries ► Major Industries – Petronet LNG, Gujarat Alkalies and Chemicals Limited, ONGC Petro Additions Limited ►
Page 11
►Scale
of
Industries – & Medium
Large Industries of Industries – ►Type Chemical & Petrochemical Industries ►Major Industries – Indofil Industries, Gujarat Flurochemical Ltd.,
► ►
►
Scale of Industries Large Industries Type of Industries Chemical & Petrochemical Industries Major Industries – ATC Tyres Pvt. Ltd., Viswaat Chemicals Ltd. Adani Power Ltd., Riddhi Siddhi Ltd. etc
Infrastructure Availability Logistics & Connectivity Rail
►
Road
Savli has access to broad gauge railway network from the following railway stations:
►
Connected to National Highway 8 (NH 8) and National Expressway 1 (NE 1) through 4 lane State Highway No 87
Vadodara railway station: 17 Km
►
SH 158 connects Savli to Vadodara.
► ►
Ahmedabad railway station: 110 Km
Air
►
Ahmedabad international airport: 110 Km.
►
Vadodara domestic airport: ~14 Km.
Port
►
Savli (Vadodara) is connected to the following ports: ►
Dahej – 150 Km Kandla – 400 Km
►
Mumbai – 450 Km
►
Utility
Water
►
Gujarat Industrial Development Corporation (GIDC) will provide water to the proposed facility.
Power
►
Electricity is supplied from an existing 132 KVA sub-station operated by Gujarat Energy Transmission Corporation (GETCO) located in the premises.
Gas ►
Gujarat State Petroleum Corporation (GSPC) is the gas supplier to the site through a well established pipeline.
►
The company needs to directly apply for gas to GSPC.
Source: “Government of India Ministry of MSME District Industrial Potential Survey Report of Vadodara District”, MSME – Development Institute (December 2014)
Page 12
Project Information Key players Switchgears and control gears market Player
Plant location
Key products
Low voltage, medium voltage and high voltage switchgears ► Air-insulated switchgears ► Gas-insulated switchgears ► Railway switchgear ► Wind switchgear ►
ABB Limited
► ►
Vadodra, Gujarat Nashik, Maharashtra
►
Siemens India
Verna, Goa ► Aurangabad, Maharashtra
►
► ► ►
Schneider Electric India
► ► ►
Vadodra, Gujarat Nasik, Maharashtra Hyderabad, Telangana
► ► ►
Vadodara, Gujarat ► Ahmednagar, Maharashtra ► Coimbatore, Tamil Nadu ►
L&T Electrical & Automation
Low voltage switchgear and busbar trunking systems Medium voltage gas-insulated switchgears Primary distribution switchgears Switchgear spare parts Primary switchgear Secondary switchgear Switchgear components
► Air ► ►
circuit breakers Control panel accessories Final Distribution Products (MCB, RCCB, RCBO, DBs)
Capacitors market Player
EPCOS India (TDK Corporation)
Deki Electronics
Plant location ► ► ►
Bawal, Haryana Nashik, Maharashtra Kalyani, West Bengal
Key products ► Aluminium ► ► ►
► ►
Noida, Uttar Pradesh
► ►
electrolytic capacitors Ceramic capacitors Film capacitors Components for power factor correction power capacitors Polyester film capacitors Mixed dielectric film capacitor Polypropylene film capacitors
EMI suppression capacitors ► General purpose capacitors ► Power electronics capacitors ► High voltage capacitors ► Automobile capacitors ► Energy meter capacitors ►
Desai Electronics
►
Pune, Maharashtra
Source: http://www.tradeindia.com/Seller-1520540-FILCON-ELECTRONICS-PRIVATE-LIMITED/ http://www.abb.co.in/references/default.aspx?db=db/db0004/db001502&c=517c501b84d3ddebc1257582004bddaf&att=Country&value=India http://www.schneider-electric.co.in/sites/india/en/company/profile/in-brief/manufacturing-plants.page http://www.larsentoubro.com/electrical-automation/products-services/products/ http://www.prnewswire.com/news-releases/india-electrical-capacitor-market-to-grow-at-36-until-2019-says-techsci-research-272272931.html
Page 13
Project Information Key Players & Suppliers in Gujarat ►
L&T
►
Siemens India
► ► ►
ABB India Parikh Switchgears A V Zaveri & co
►
Thermafiled Power Components Pvt Ltd
►
Century Corporation
►
M & T Industries
►
Gujarat Switchgears Pvt Ltd
►
Surya Enterprises
►
Karnavati Electric & Engineering
Key Considerations Poor financial condition of state electricity boards (SEBs) ►
SEBs have been facing losses due to the supply of subsidized power to agricultural farmers, theft of power and inefficient T&D infrastructure.
►
This has restricted private investment in the power T&D sector, thereby reducing the quality of service from SEBs. This, in turn, is affecting the capacity building program and distribution network expansion in India.
High dependence on imports ► A
significant proportion of switchgear and control gear, and capacitors demand is still being met through imported, creating hurdles for domestic manufacturers.
►
Companies prefer imported switchgear owing to relatively faster delivery schedule and competitive cost of sourcing. Also, lack of manufacturing facilities, especially capacitors, increases dependence on imports.
Non-standard ratings ►
Ratings of electrical equipment are not standardised and all utilities follow their own standard ratings.
►
To meet their requirements, manufacturers have to constantly modify the design and spend resources in redesigning, etc. moreover, testing of such electrical equipment is also time consuming and costly.
Source: “IEEMA-Annual-Report 2014-15” IEEMA (September 2015), http://ieema.org/wp -content/uploads/2015/09/IEEMA-Annual-Report_201415.pdf “On A Threshold Of Transformation - India’s Transformer Industry”, Electrical India (July 2015), accessed via, http://www.electricalindia.in/blog/post/id/5624/on-a-threshold-of-transformation-indias-transformer-industry
Page 14
Project Financials Estimated project cost – switchgear and control gear/panel The total project cost of setting up a ~10,000 sq mt switchgear and control gear/panel manufacturing facility at Dahej, Gujarat, will be ~INR1350 million Project specifications
INR million
% of overall cost
Land (10,000 sq mt @ INR ~1,440 per sq mt1)
14.4
1%
Other costs including land development and civil works, plant and machinery, contingencies and working capital
1336
99%
Total cost
1350
100%
Project cost is a ball park figure based on the cost (adjusted for inflation) and other metrics of the following projects: Company
Plant Location
Area (sq mt)
Announced Date
Total Cost (INR million)
Manpower
ABB India
Vadodara, Gujarat
15,000
Nov 2013
2500
-
L&T
Vadodara, Gujarat
27,000
Jul 2012
1300
400
Siemens India
Verna, Goa
-
Jan 2012
2000
120
Siemens India
Aurangabad, Maharashtra
5,000
Jun 2009
400
100
Estimated project cost – capacitors The total project cost of setting up a capacitors manufacturing facility at Savli, Gujarat, will be ~INR 50 million, with an annual capacity of ~200 million capacitors. Project specifications
INR million
% of overall cost
Land (6,000 sq mt @ INR ~1,440 per sq mt1)
8.6
2%
Land development and civil works
50
10%
Plant and machinery
380
76%
Contingencies and working capital and misc. assets
60
12%
498.6
100%
Total cost
The project cost is a ball park figure based on the cost (adjusted for inflation) and other metrics of the following projects: Company
Plant Location
Area (sq mt)
Announced Date
Total Cost (INR mil)
Manpower
Desai Electronics
Pune, Maharashtra
3,000
Dec 2013
160
-
EPCOS India (TDK)
Bawal, Haryana
8,600
Jun 2012
688
400
1) Note: 1) GIDC Allotment Prices for FY16-17
Page 15
Project Financials Manpower requirements ►
Overall manpower required: 400-500 persons ►
10,000 sq mt switchgear and control gear/panel facility: 150-200 persons
►
200 million per year capacitors facility: 250-300 persons
Recent projects – switchgear and control gear/panel ►
ABB’s high-voltage (HV) switchgear and distribution transformer facility at Savli, Vadodara
L&T’s INR130 crore switchgear facility at Vadodara, Gujarat
►
►
In November 2013, ABB inaugurated a USD50 million15,000 sq mt manufacturing facility at Savli. The facility manufactures HV gas-insulated switchgear and plugand-switch system hybrid switchgear to serve domestic demand in India and also act as an export hub. Apart from this the facility also manufactures distribution transformers of range up to 10 MVA and 36 kilovolts kV.
►
In July 2012, L&T inaugurated a 27,000 sq mt switchgear manufacturing facility at Vadodara, Gujarat.
►
The company had invested INR1300 million on the facility, which primarily manufactures air circuit breakers (ACBs) and moulded case circuit breakers (MCCBs), and also houses a development centre for R&D and engineering of circuit breakers.
Recent projects – capacitors
Desai Electronics’ new facility at Pune, Maharashtra
EPCOS India’s (TDK) power capacitor plant at Bawal, Haryana
►
In December 2013, Desai Electronics commissioned a 3,000 sq mt capacitor manufacturing facility at Pune, Maharashtra.
►
The company invested INR160 million on the facility which has an annual manufacturing capacity of 200 million capacitors and primarily manufactures plain film foil and metallised capacitors for diverse applications, such as fan regulators, dimmers, appliances and lighting (CFL and ballast).
►
In June 2012, EPCOS India, a subsidiary of Japan-based TDK Corporation, established a 8,600 sq mt facility at Pune, Maharashtra to manufacture AC capacitors for motor start and motor run applications and capacitors for power factor correction (PFC).
►
The company invested €10 million (INR690 million) on the facility and also planned to expand manufacturing to include medium voltage PFC capacitors.
Source: “Siemens to set up energy sector in Goa”, Business Standard (November 2010), http://w ww.business standard.com/article/companies/siemens-to-set-up-energy-sector-in-goa-110110100209_1.html http://www.energetica-india.net/news/siemens-opens-a-new-factory-for-gas-insulated-medium-voltage-switchgear-in-india http://www.siemens.co.in/en/news_press/index/greenfield_factories.htm http://www.siemens.co.in/en/news _press/index/news_archive/june_05_2009.htm http://www.bchindia.com/company/infrastructure/manufacturing/
Page 16
Approvals & Incentives Gujarat Industrial Policy 2015 Government of Gujarat has announced an ambitious Industrial Policy, in January 2015, with the objective of creating a healthy and conducive climate for conducting business and augmenting the industrial development of the state.
Quantum of incentives The incentives under this policy will be available to all the Talukas listed in Government Resolution dated 25/7/2016 except areas falling within municipal corporations. % of eligible fixed Category of % of Net VAT % of Net VAT to be capital investment Incentive period Project Location reimbursement to paid to (no. of years) entitled for (Taluka) the unit Government Incentive 1 100 90 10 10 2 80 80 20 10 3 70 70 30 10
Net VAT incentives Net VAT incentive will be reimbursed to the industrial undertaking in one financial year will not exceed one-tenth of the total amount of eligible incentive. Classification of the Project Ultra Mega Industrial Unit Mega industrial Unit Large Industrial Unit Micro, Small or Medium Industrial Unit
Amount (in INR crore) 500 400 150 50
Industries in the Sector can opt for either the general incentives under the Gujarat Industrial Policy- 2015 or the incentives provided below if the proposed plant is an MSME (i.e. Plant and Machinery cost is less than INR 10 crore): :
As per the Gujarat Industrial Policy-2015, following are the key incentives provided to the manufacturing sector (including switchgear, control gear/panel and capacitors manufacturing): ► Interest subsidy of 5% with the maximum amount of INR 25 lakhs (~USD 37,5001) per annum for 5 years on the term loan of machinery and equipment for plants set up within municipal corporation areas. ► Interest subsidy of 7% with the maximum amount of INR 25 lakhs (~USD 37,5001) per annum for 5 years on the term loan of machinery and equipment for plants set up outside municipal corporation areas. ► Capital investment subsidy of 10 % loan amount disbursed by Bank/Financial Institution with a maximum amount of INR 15 lakhs in Municipal Corporations areas.
Note: 1) Currency converted at USD 1 = INR 66.66 as on 9 June 2016.
Page 17
Approvals & Incentives ►
Indicative List of Approvals
Approvals/clearance required
Department to be approached and consulted
Incorporation of company
Registrar of companies
Registration/Industrial license
Secretariat if industrial assistance (SIA) for large and medium scale industries
Allotment of land
State industrial development corporation
No objection certificate (NOC) under air and water pollution control acts
State pollution control board
Approval of construction and country planning
► ► ► ► ►
Town and country planning Municipal and local authorities Chief inspector of factories Pollution control board Electricity board
Finance
For loans higher than INR 1.5 crore, all India financial institutions like Industrial Development Bank of India(IDBI), Industrial Credit and Investment Corporation of India(ICICI), Industrial Finance Corporation of India(IFCI) etc.
Registration under state sales tax act and Central and State excise act
►
Code number for export and import
Regional office of director general of foreign trade
Environmental clearance
Ministry of environment, forest and climate change after conducting environment impact assessment (EIA) for any project
Hazardous waste import and export approval
Ministry of environment, forest and climate change
Exiting business
Ministry of corporate affairs
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Sales tax department Central and state excise department
Government of Gujrat has introduced single window facilitation portal for investors providing undermentioned benefits: ► Centralized system to monitor applications. ► User friendly and simplified application process for investors. ► System for authorities and investors to check the status of applications. ► Increased departmental ownership. ► The unit shall be facilitated through ‘Investor Facilitation Portal’ for obtaining all the necessary state approvals/ clearances - https://www.ifp gujarat.gov.in Source “Gujarat Textile Policy”, Industries and Mines Department, Government of Gujarat, 5 September 2012 Approvals required for setting up plant, http://dipp.nic.in/English/Investor/Investers_Gudlines/approval_clearances_required_for_new_projects.pdf, accessed 8 July 2016 “Environment clearance” http://envfor.nic.in/major -initiatives/environmental-clearances, accessed 8 July 2016 “Gujarat single window clearance, https://w ww.ifpgujarat.gov.in/portal/jsp/aboutUs.jsp, accessed 8 July 2016 “Exiting business, http://www.mca.gov.in/MinistryV2/CloseCompany.html, accessed 9 July 2016 “Manufacturing Sector – Profile”, Vibrant Gujarat website, 7 October 2014 Industries Commissionerate website, http://ic.gujarat.gov.in/?page_id=3175, accessed on 1 June 2016 “Textile industry welcomes amended TUFS”, Business Standard, 2 January 2016 “Approvals” http://dipp.nic.in/English/Investor/Investers_Gudlines/FAQ_GrantIndustrialLicence.pdf, accessed 27 June 2016 “List of defence equipment requiring industrial license”, http://dipp.nic.in/English/acts_rules/Press_Notes/pn3_2014.pdf
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Industries & Mines Department www.imd-gujarat.gov.in
Gujarat Industrial Development Corporation www.gidc.gov.in
Office of Industries Commissioner www.ic.gujarat.gov.in
Industrial Extension Bureau www.indextb.com
This project profile is based on preliminary study to facilitate prospective entrepreneurs to assess a prima facie scope. It is, however, advisable to get a detailed feasibility study prepared before taking a final investment decision.
Office of The Industries Comm issionerate Block No. 1, 2nd Floor, Udyog Bhavan, Gandhinagar 382 010. Gujarat Ph.: 23252683/23252617 Email ID:
[email protected]
