Madhya Pradesh: Means Business

Roads

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 Overview
Overview Madhya Pradesh (MP) – State that means business

 MP is the second largest State in the Country stretching over 308,000 sq kms.
 The State is blessed with large mineral resources of coal, diamond, limestone, methane etc.
 MP is among the top 4 states of the Country for industrial investments.

Economic Snapshot Madhya Pradesh is emerging as a key growth center for the Country

 Per capita GSDP USD 369**

 Gross state domestic product (GSDP) USD 23,983.63 Mn**
 Manufacturing sector USD 8.5 bn**
 Average growth rate 5.5% per annum
(Registered & Unregistered)

Advantage MP Madhya Pradesh has one of the upcoming industrial base in India

 Total electricity generation capacity 6,449.25 MW*

 The State is centrally located
 India’s first greenfield SEZ Indore SEZ
 Investor friendly Government policies
 Industrial Centers 8

Power Electricity generation capacity at present is 6,449.25 MW and estimated to rise to a surplus in 2008-09
 MP is rich in low grade coal suitable for power generation.
 Potential of hydro-energy generation.
 Installed power capacity (MP’s share)
 Hydel Power Generation: 852.7 MW*
 Thermal Power Generation: 2,147.5 MW*

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*Ministry of Power (powermin.nic.in) **Source: Indiastat.com (as on 23 Feb 2006)
 Enabling Infrastructure
• The State is well connected with the rest

RAILWAY NETWORK
of India with almost 425 trains passing
MP IS CENTRALLY LOCATED AND WELL
through the State on a daily basis. Of
CONNECTED WITH ALL MAJOR CITIES IN INDIA
these 175 trains pass through the State

capital Bhopal alone.

• 25 airstrips.**
• Convenient air links from key Indian
GWALIOR cities like Delhi & Mumbai to Bhopal,
Jabalpur, Gwalior, Indore and

AIRPORTS
Khajuraho.
KHAJURAHO • 5 operational airports.
• Indore airport has the capability of
INDORE BHOPAL
handling international cargo.
JABALPUR
• An international airport proposed in
Bhopal.

• The total length of roads spanning MP is

67,600 kms.**
• National highways of 5,200 kms run
ROAD NETWORK

through the State.*

• 18 National highways including trunk
routes of Delhi-Mumbai, Delhi-Chennai,
Delhi-Bangalore, Delhi- Hyderabad.
• The total length of State highways in the
State is 9,885 kms.**
• Convenient linkages to western ports i.e.
Kandla Port, Jawahar Nehru Port Trust.

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*Source: Department of Road Transport & Shipping (morth.nic.in) **Source: www.destinationmadhyapradesh.com
 Madhya Pradesh: A Preferred Investment
Destination
31% of the State under forest Over 2,000 kms of roads India’s 1st operational Offers diverse tourists destinations
cover with a largely unexploited being developed with Greenfield SEZ at Indore catering to various segments of
species of rare, valuable Private Partnership (BOT) tourism such as religious (Bhojpur),
medicinal- herbal plants eco/ adventure (Panchmari), heritage
(Sanchi, Khajuraho) tourism etc.

Over 100 agricultural farms with Third largest producer of

an area of over 20,000 acres is cement in India*
available on lease to investor

Favourable climatic Various blocks available

conditions for cotton for power, cement, iron
and over 40,000 power- and steel units
looms are driving the
textile industry

Largest producer of pulses Over 18,000 technical

and oilseeds in the Country graduates and 230,000
(~75% of soyabean graduates add to workforce
production) each year

Availability of coal and natural gas Over 144 BCM of coal bed 12 blocks with reserves
(G.A.I.L pipeline) along with support methane reserves available totalling 2,585 million tons
from Government to make investment of coal has been identified
in Thermal Power Plants lucrative

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*Source: www.mpsidc.org & Brochure: MP Means Business
 MP: The Right Place with the Right Environment
Savings in Office Space Rates
(A comparison of rates in Central Business Districts)
Fastest mover* in overall
DESTINATION MADHYA PRADESH Mum bai
150

performance among the Ahem adabad Delhi

100
big States in the Country.
50
Bhopal Bangalore

Fastest mover in agriculture Indore Chennai

Hyderabad Pune
Delhi
(740 Kms)
(MPV - 789.5)

Fastest mover in
Ahmedabad Bhopal and Indore have substantial cost
infrastructure development. (570 Kms)
(MPV - 220.63) advantages, even when compared to other Tier
III and IV cities.

Savings in Land Cost

Ranks 2nd in terms of Kolkata
(1350 Kms) (Estimated Values for Multi-
Mumbai Vishakapatnam
governance. (MPV - 613.19) 100% product SEZs)
(780 Kms)
(MPV - 1000) Pune 80%

(800 Kms) Indore

60%
Chennai
(MPV - 206.51) Hyderabad 40%
(840 Kms) Key Markets
20%
(MPV - 257.9) (Distance From
Ranks 3rd in terms of law & Bhopal) 0%

order Chennai MPV – Market

Bangalore (1430 Kms) Potential Value
Jaipur Greater Noida
(1400 Kms) (MPV - 362.84)
(MPV - 254.52)

Chandigarh
Cost of skilled labour is USD
2.4/day vis-a-vis USD 3.5 –
USD 4.0/day in metros
The cost of land is one of the lowest in the Country.
MP is centrally located. The State is at an easy distance from
Even central hubs such as Indore and Bhopal fare
* Fastest mover is the State where the rate of all the key consumer markets in the Country. well against other cities in terms of low land cost.
improvement between 2003 & 2006 was greater
than that between 1991 & 2003

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**Source: India Today (September ‘06 Issue) Source: (Reference: RK Swamy) - Distances rounded off
Industrial Policy: Catalyst for the
Investments
The Government of MP has devised an investor friendly industrial policy, SPECIAL INCENTIVES
which is aimed at achieving global competitiveness. The policy emphasizes
• Special package for Mega Projects on project basis by apex level
on industrial growth in the state through adopting cluster approach, investment promotion empowered committee headed by the Chief
establishing specialized infrastructure and offering favourable incentives. Minister.
• Industrial investment promotion assistance – 50% to 75% of commercial
The main thrust of this policy is: tax for 3-10 years
• Concessional registration charges and stamp duty exemption for
• Establishment of a Madhya Pradesh Trade and Investment Term Loans.
Facilitation Corporation which would take decisions about • Interest subsidy on term loan for 5 – years @ 3% to 5%.
rationalization of taxes, facilities of mega projects and other related • For thrust sector industries, 25% capital subsidy would be provided
limiting up to a maximum of USD 56,000
matters.
• Land on 75% concessive rate for Mega Projects limited to USD 4.4
million.
• Enacting an Industrial Facilitation Act and to change the rules of
• Entry tax exemption for 5 years.
business with a view to make single window system decisive and result
• 5 years electricity duty exemption on captive power generation
oriented. • 15% capital subsidy to SSI up to USD 33,000 in backward areas
• Developing infrastructure for supporting the identified industrial • Infrastructure grant up to USD 0.22 million crore for developing private
sector industrial parks
clusters
• Partial reimbursement for Project report, ISO Certification, Patent and
Technology Purchase cost
• Reviving closed down/ sick industrial units by granting special packages.
• Attractive incentive schemes.
Crystal IT Park Indore
CLUSTER APPROACH

SPECIALIZED INFRASTRUCTURE
• Indore – Pharmaceutical, Textile, Food Food Parks Mandsaur, Khargone, Chhindwara,
Processing, IT, Auto Components Hoshagabad, Mandla and Bhind
• Bhopal – Engineering, Biotechnology, Herbal, Stone Park Katni
IT, Food Processing
• Jabalpur – Garment, Mineral, Forest & Herbal, Herbal Park Rewa
Food Processing Granite Park Chhatarpur
• Gwalior – Electronics, IT, FMCG, Engineering,
Food Processing Life Sciences Project Bhopal

• Rewa – Refractories, Lime Stone, Forest Based Apparel Park Indore (SEZ)
• Sagar – Mineral Processing
Gems & Jewellery Park Indore

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 Doing Business Made Easy Through
MPAKVN
In a bid to build a competitive environment; industries and their ancillaries would be promoted in clusters based on the availability of raw materials,
skilled labour and market potential. Under this Industrial Policy through Madhya Pradesh Audyogik Kendra Vikas Nigam Ltd (MPAKVNs)
scheme, the State Government, has identified industrial clusters. Many of the industrial giants have their establishments in these areas, however 44% of
developed area is still untapped and open for investment.

Area Developed: 1,330 Hectares Area Developed: 2,262 Hectares Area Developed: 790 Hectares Area Developed: 273 Hectares

Allotted: 618 Hectares Allotted: 800 Hectares

JABALPUR AKVN
Allotted: 125 Hectares Allotted: 115 Hectares

GWALIOR AKVN
BHOPAL AKVN

REWA AKVN
Units established: 286 Units established: 326
Units established: 52 Units established: 121
Major Groups:HEG, Crompton Major Groups: JK, Surya Roshini,
Major Groups: Raymond, Hindustan Major Groups: Birla, Jaypee
Greaves, P&G, Godrej, Lupin, IFB, Godrej, Grasim, Cadbury, Hotline,
Crompton Greaves Petroleum, PBM, Ayur
Oswal, Nahar Special Infrastructure: Integrated

Special Infrastructure: ICD, Food Special Infrastructure: ICD, Food Special Infrastructure: Stone Park, infrastructure development centres

Park Park Food Park (IIDC)

Area Developed: 2,492 Hectares

Malanpur, Malanpur
Phase II, Banmore,
Allotted: 1431 Hectares Chainpura,
Siddhgawan,
Units established: 575 Pratappura Total developed area 7,147
INDORE AKVN

Hectares
Rewa, Waidhan
Major Groups: Tata, Ranbaxy, Eicher,
Total allotted area 3,089
Bridgestone, Hindustan Motors, Kinetic, Hectares
SRF, S Kumars, Gajra, Nicholas Piramal, Mandideep,
Pillukhedi,
Mandideep Phase II Total units 1,360
Indorama, IPCA, Bhilwara established
Borgaon, Maneri,
Pithampur, Kheda, Purena
Special Infrastructure: SEZ, Crystal IT
Dewas, Maksi, Growth centres 19
Park, Food Park, Apparel Park Megh Nagar

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Source: MPSIDC
 Sector Profile

Roads
Sector Profile: Roads
Roads: Motoring Away

MP: Connecting India

MP: Offering Specific Incentives

Government Initiatives: MP Road Policy

MP: An Investment Destination

Way Forward

Connecting Further

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Roads - Motoring Away
• India has one of the largest road networks in the world (over 3.3 million km). Indian Road Network*
The roads carry nearly 70% of freight and 85% of passenger traffic in the Indian road network of over 3.31 million Km. is
second largest in the world and consists of :
country.
Length (In Km)
• Government expenditure on roads in India is significant - 12% of capital and
Expressways 200
3% of total expenditure. Investment in the road sector is expected to touch
National Highways 66,590
USD 66.50 billion in 2005-07. As per National Highways Authority of India
State Highways 1,28,000
(NHAI), a total of 23,546 kms of roads would be constructed in the next two
Major District Roads 4,70,000
years. This construction would be conducted under following four programs,
Rural and Other Roads 26,50,000
namely:
Total Length 3.31 million km (Approx)
 Golden Quadrilateral (Program Under NHAI)

 North-South and East-West (Program Under NHAI)

 Port connectivity and other projects

 Non NHDP (National Highway Development Program) Projects.

• The focus of successive Governments on improving road connectivity across

the country, has brought about significant investments in road development.

• As per a recent World Bank study, the cumulative funding shortfall over the Status of National Highways as on 31st July, 2006*
10 year period is estimated at USD. 23.22 billion , approximating 39% of the Single Lane/Intermediate Lane 32%
total requirement. The funding gap assumes that all the road user charges Double Lane 56%
generated on the highways are returned to the highway sector. If the current
proportion of road-user charge revenue is returned (56%), then available Four or more Lanes 12%
funding for highways would be less than the maintenance needs, and the
funding gap would rise to USD 39.11 billion.

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*Source: National Highway Authority of India (www.nhai.org)
 MP: Connecting India
• MP has a well developed transport infrastructure of roads, rails ROAD MAP OF MP

and airports. 5200 km* of National Highway runs across the

state with total length of the roads estimated around 67,600
km*.

• MP has the 3rd largest network of National highways in the

Country after Uttar Pradesh and Rajasthan.

• Since MP is centrally located within the country, most of the

long haul road traffic in the north-south and east-west direction
in the country has to pass through the state.

• 18 National Highways including trunk routes of Delhi-

Mumbai, Delhi-Chennai, Delhi-Bangalore, Delhi-
DISTANCES OF MAJOR CITIES FROM THE STATE CAPITAL*
Hyderabad complete their stretch by passing through the FROM TO DIST.
State. Bhopal Delhi 740 Km
Bhopal Mumbai 780 Km
• State highways are of 9885 kms* length, connecting key urban
Bhopal Chennai 1435 Km
and tourist centers within the state Bhopal Bangalore 1400 Km
Bhopal Hyderabad 840 Km
• State roads provide convenient linkages to Kandla Port,
Bhopal Kolkata 1350 Km
Jawahar Nehru Port Trust.
Bhopal Kandla 930 Km
Bhopal Ahmedabad 570 Km

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Source: NHAI (www.nhai.org) Distances rounded off
MP: Offering Specific Incentives
• In terms of infrastructure, roads in particular has been recognised
as the thrust area by the Government of MP.
• In order to promote involvement of the private sector in
construction and maintenance of roads, the Government has
decided to offer projects on a Build-Operate-Transfer (BOT)
basis.
• Private sector participation initiative has been taken by MP
Government as large funding amounts are required for such mega
ventures.
FEATURES OF MP BOT SCHEME
• Foreign investments in the development of selected stretches
of State Highways to maintain and operate them generally for a
period up to 30 years (concession period) after opening the
facility for traffic and the entrepreneur is permitted to collect and
retain toll as approved by the Government
• Private entrepreneurs will design, construct, maintain and
operate the facility from their own resources or funds borrowed
from financial institutions, banks, open market etc.

• To ensure free flow of traffic, the normal checks by the authorities

will be conducted at entry and exit points only. The traffic on such
Type Of Projects Identified For Private Sector Participation
facilities will be normally regulated by the entrepreneur.
• Considering the usefulness to serve the economy, the intention of
• Basic facilities for the traffic en route, provision for developing
the Government is to involve Private Sector for taking up
and operating highway related facilities such as restaurants,
development of following type of projects on State Highways :
motels, fuel stations, rest/parking areas, shopping malls,
(i) By passes transport nagars and other related facilities could be made.
The income from such facilities will also enhance the viability of
(ii) Bridges the project.
(iii) Railway Over Bridges
(iv) Widening of existing roads
(v) Ring Roads near big cities.
(vi) Improvement/ maintenance of existing roads etc.
• There is a significant opportunity for BOT in the national highways
segment as they carry more than 40% of the traffic even though
they constitute just about 2% of the total road network in the
country.
The Government is paying special attention towards the quality of roads being constructed. With the number of projects proposed, the private sector
participation is foreseen for the overall development of the State.

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MP: Offering Specific Incentives
• The State Government is also focusing on the development of OTHER SUPPORT FROM THE GOVERNMENT
the National Highways that run through the State to promote 1. Project Implementation
the participation of private investors. These works include
• The entrepreneurs will enjoy full freedom in carrying out the
the following: assigned project. However, they will have comply with
• Rehabilitation of the roads certain standards, safety of structures, specifications,
satisfactory operations and management as laid by the
• Maintenance Government.

• Construction of new patches • The Public Works Department (PWD) will play a major role
in approvals and implementation.
• For NHDP in particular, the private sector has responded
enthusiastically. Under this programme, projects valued at
2. Registration of entrepreneurs under special category
over USD 1.33 billion are being implemented. The NHDP has
• The State Government has registered entrepreneurs for
been extended to cover a 50,000 km road network, and
carrying out work on a B.O.T. basis.
these future works will be undertaken on a BOT basis (through
toll or annuity). • 35 firms have already been approved under this category

GOVERNMENT DIRECT SUPPORT

• The State Government will identify priority projects, and allow
the private sector to design, construct and operate the toll
roads. The choice of entry/ exit points may be mutually agreed
between the Government and the entrepreneur.
3. Modification in B.O.T. contract
• Further to the inputs received from the entrepreneurs, the
contract agreement to be used for the B.O.T. scheme has
been modified and made more comprehensive to facilitate
smooth working and execution.

• The land for highway development will be acquired by the

Government and given to the entrepreneurs on certain terms
and conditions for the land.

• Tax holiday for five years for road infrastructure development

project as per the policy decision of Central Govt.

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Source: www.mp.nic.in/pwd
Government Initiatives: MP Road Policy
• The main aim of the MP Road Policy is to work towards the up MADHYA PRADESH ROAD POLICY

gradation of the existing road infrastructure so as to provide

an efficient road network system along the length and breadth of
the State keeping in mind that the accruing benefits may be
passed on evenly to all sections of the society
• Government of MP has made recent amendments in the Indian
Tolls Act of 1932, so as to encourage private sector
The main objectives of the Road Policy are:
• To provide connectivity to villages with a population of more
than 1000.
• The road network for villages having population less than 500,
will be so planned that an all weather road will be available at a
distance of 3 km in plain areas and at a distance of 5 km in hilly
areas.

participation in mega ventures.
• The major roads in the State have been rehabilitated or have been
taken up for rehabilitation. The State has come up with road
renewal programmes under which maintenance of the existing
road infrastructure will be undertaken. The envisaged activities will
be according to the following renewal regime:
• Improvement of existing State road network system to 2 lane/ 4
lane roads to cater the need of the projected traffic.
• To enhance the road infrastructure in towns and cities.
• To effectively utilise the present resources.
• To constantly update the highway technology by adopting
modern techniques of construction and training of department
personnel.

• To ensure high standard of road safety and travel comfort.

• National Highways - One third of the road length every year

• State Highways - One fifth of the road length every year

• Major District Roads - One sixth of the road length every year

• Village Roads - One eighth of the road length every year

• All the major towns and district headquarters are linked with roads
having high quality surfacing and riding comfort

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MP: An Investment Destination
• The State Government of MP has taken initiatives to improve
the condition of the roads on a priority basis. The budgetary
allocation for roads has been increased from USD 90 Mn in
2003-04 to around USD 210 Mn in 2005-06.
• All the divisional headquarters have been connected to the
State capital by road. It is now proposed that all the district
headquarters will be connected to the Divisional
headquarters.

• In the past 2 years, 12,500 kms of roads were constructed SOME SUCCESSFULLY COMPLETED BOT PROJECTS

which is now projected to increase to 40,000 kms more in the Name of the Project Length (Kms) Project Cost (Mn USD)
next 3 years Dewas – Ujjain - Badnawar 98.26 11.09

• The State Government is encouraging the involvement of Hoshangabad – Piparia - Panchmarhi 126.00 12.66

private sector to take up the projects on a BOT basis. Hoshangabad – Harda – Khandwa 185.00 18.00

Satna – Maihar – Umaria 141.00 11.84

• These initiatives by the Government are showing immediate
Rewa – Amarkantak 246.00 24.72
results, with the traveling time being decreased significantly.
Indore – Edelabad 203.00 27.56
Distance Before At Present Ujjain – Jhalawad 134.00 14.82
Hoshangabad - Harda 100 km 8 hrs 2 hrs Jabalpur – Narsinghpur – Piparia 140.00 16.65
Hoshangabad - Seoni 90 mins 45 mins Raisen – Rahatgarh 101.40 12.82

• At present 1000 kms of roads have already been laid down

on a B.O.T. basis and construction of another 1100 kms is in Leading Road Developers such as Ramky Infrastructure
progress. Construction Private Limited, Unitech Limited, KNR
Constructions Limited, Madhucon Projects have sizeable
• Madhya Pradesh Road Development Corporation (MPRDC)
presence in the State and are involved in several National and
is the nodal agency carrying out all the developmental work in
State Government projects. The peaceful environment in the State
association with the private sector.
and the cooperative State Government facilitates faster
• It is proposed that MPRDC will carry out the development of implementation of the project thereby increasing the profitability of
3000 kms of road in the next 3 years with assistance from the project.
NABARD and the Central Government.

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 Way Forward…
The State Government has already completed the work on a total of 2977.25 km length of roads with the total cost of USD 361.22 bn*.
There are various projects where the Government is seeking private partner investment. Following are some of the identified projects that
are proposed to come up in the near future. Many of these high density roads will be developed under BOT/ private development
methods. This offers a significant opportunity for infrastructure players to invest in the sector.
B.O.T. PROJECTS (PROPOSED) ADB PHASE III (STATE HIGHWAY PROJECTS COMING UP)
S.No Name of project Length Estimated cost (Mn S.No. Name of project SH no. Total length (kms)
(kms) USD)
1 Shivpuri – Sheopur – Pali 06 143.60
1 Sehore – Dewas 142 ~103.00
2 Kurwai – Chanderi – Pichoore 19 183.00
2 Lebad – Nayagaon 250 ~184.00
3 Bareli – Piparia 19 32.00
3 Chandrapur – Badwani 100 ~12.50
4 Damoh – Hata – Amanganj 49 112.00
4 Matkuli – Tamia – 108 ~21.00
Chindwada 5 Chhilpi – Baiihar – Balaghat 26 135.00

5 Mandsaur – Sitamau (up to 44 ~5.60 6 Khandwa – Khargone 26 87.00

Rajasthan Border)
7 Satna – Chitrakoot 11 74.00

8 Chiraidongri – Seoni 11A 97.00

9 Malhara – Amanganj 10 90.00

NATIONAL HIGHWAY PROJECTS (PROPOSED)
10 Hoshangabad – Nasarrullaganj – 22 90.00
S.No Name of project Length Estimated cost (Mn Khategaon
(kms) USD)
11 Silvani – NH12 Junction 16 53.00
1 NH 75 (Km 0 to 85) 108 ~120.00
12 Banher – Bistan (Maharashtra) 31 25.00
2 NH 7 (Km 544 to 652) 104 ~115.50
13 Khargone – Mandleshwar – Mhow 01 119.00
3 NH 3 (Khalghat to 88 DPR IN PROGRESS Considering the
14 Balaghat – Nainpur 11 75.00
Maharashtra Border) successful completion
15 Tala – Shahdol 10 85.00
4 NH 12 (Bhopal – Deori – 297 DPR IN PROGRESS of other mega projects
Jabalpur)
16 Morena – Porsa 02 50.00 and the potential lying
5 NH 59 (Indore – Jhabua –
Ahmedabad)
169 17 Indore – Ujjain 17 55.00 in the up coming
ventures, the road
BOT

18 Shyampur – Goras 23 58.00

6 NH 69 (O’ganj – 13 DPR IN PROGRESS
Bhimbhekta) 19 Dindori – Mandla – Lakhnadon 40 134.00
sector in MP is poised
7 NH 75 (Jhansi to Khajuraho) 100
to become the most
20 Katni – Barhi – Tala 10 60.00
lucrative areas for
21 Gairatganj – Gadarwra 44 85.00
8 NH 86 Ext (Bhopal to 40 private investors in
Sanchi) 22 Bela – Govindgarh – Churhat 52 63.50 times to come.

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Source: mprdc.nic.in
Connecting Further

National Highways Authority of India www.nhai.org

Public Works Department, Madhya Pradesh www.mp.nic.in/pwdmp

Madhya Pradesh Road Development Corporation mprdc.nic.in

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