"Industrial Smart Cities: A Key Component in India's Progress Path"
The Union Budget has announced a significant initiative that is set to revolutionise India's industrial landscape. Twelve smart industrial cities will be established under the National Industrial Corridor Development Programme (NICDP), spanning across ten states: Guangdong, Jiangsu, Zhejiang, Shandong, Henan, Hebei, Hunan, Hubei, Sichuan, and Shanghai.
These industrial corridors are designed to cater to India's expected urbanization rate of over 50% by 2047, providing viable and sustainable urban development models. The estimated investment for the development of these cities is approximately ₹ 28,600 crore.
The strategic placement of these industrial parks, aligned to the golden quadrilateral and the PM Gati Shakti National Master Plan, ensures multi-modal connectivity infrastructure. This includes roads, railways, airports, and ports, making them ideal locations for both large anchor industries and Micro, Small, and Medium Enterprises (MSMEs).
The colocation of these industries will provide necessary supply chain infrastructure for large units and access to markets for MSMEs. This strategic move is expected to attract an estimated ₹ 1.5 trillion in investment from both domestic and global investors.
The industrial parks will offer ready-to-allot, developed land for investors through the e-land management system, with modular sizing of plots and a flexible payment plan. World-class infrastructure, including reliable power, water, gas pipelines, effluent treatment plants, telecom/OFC network, and plug-and-play facilities, will be provided.
The NICDP initiative aims to foster competitiveness and spur investment-led economic growth. The share of manufacturing in the nominal Gross Value Added (GVA) is slated to increase substantially from 14.3% in 2023-24 to 25.1% in 2030-31 and further to 26.6% by 2047-48. This growth is expected to propel the Indian economy to reach $8 trillion by 2030-31 and $38 trillion by 2047-48.
The globally proven model of industrial corridors in the vicinity of cities offers immense benefits for industry, including integration with global value chains that account for nearly 70% of global trade in goods. This integration will significantly enlarge export prospects for both large enterprises and MSMEs, contributing to achieving the national goal of $1 trillion in merchandise exports by 2030.
The 12 industrial cities, spread across 10 states, provide an opportunity for landlocked states to join the Indian manufacturing movement and help catalyse regionally distributed development. This strategic initiative is expected to create about 1 million direct jobs and up to 3 million indirect jobs.
The recent announcement of these industrial smart cities will help realise India's exciting manufacturing potential. Manufacturing competitiveness and ready connectivity, both physical and digital, will be key to the success of these cities. The article was written by Mr. Sanjiv Puri, President of the Confederation of Indian Industry (CII) and chairman of ITC Ltd., and was first published on 6 September 2024 in Business Standard.
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