ASEAN and India: Charting the New Asian century

By Strategic Investment Research Unit (SIRU)

For over half a century, the Association of Southeast Asian Nations, or ASEAN, has been among the most successful intergovernmental organisations, not just in the developing world, but across the globe. In upholding the economic interests and representing the social traditions and cultures of the 650 million people of Brunei, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, Philippines, Singapore, Thailand, Vietnam, this 10-member organisation has shone the path in unique regional cooperation. India, a leading power in the region with a robust business environment and flourishing populace, is a strong partner for the ASEAN bloc in Asia.

India’s foreign policy cornerstone ‘Act East Policy’ launched in 2014, gave increased momentum to this partnership and emphasised greater integration through improved connectivity, and commercial and cultural ties. With over two billion inhabitants who constitute more than a quarter of the global population, India and ASEAN hold the promise of a future where growth and prosperity abound. Their booming domestic markets, growing middle classes, strong skilled workforce of over a billion people, and business friendly policies hold tremendous potential for global investors keen to explore the surge of youth-led economic growth. By capitalising on the opportunities that India and ASEAN collectively offer, investors can unleash a brewing Asian future of integration, cooperation and economic success.

In analysing these inherent factors, this report presents to investors a sectoral outlook on how the India-ASEAN relationship can be leveraged for global business opportunities.

Production Linked Incentive (PLI) schemes

Hon'ble Finance Minister, Smt Nirmala Sitharaman has announced an outlay of INR 1.97 Lakh Crores for the Production Linked Incentive (PLI) Schemes across 13 key sectors, to create national manufacturing champions and generate employment opportunities for the country’s youth. In addition to the three schemes announced earlier in March 2020, GoI has further introduced the following 10 new PLI schemes in November 2020:

March 2020

Key Starting Materials (KSMs)/ Drug Intermediates (DIs) and Active Pharmaceutical Ingredients (APIs): Department of Pharmaceuticals

Large Scale Electronics Manufacturing: Ministry of Electronics and Information Technology

Manufacturing of Medical Devices: Department of Pharmaceuticals

November 2020:

Electronic/Technology Products: Ministry of Electronics and Information Technology

Pharmaceuticals drugs: Department of Pharmaceuticals

Telecom & Networking Products: Department of Telecommunications

Food Products: Ministry of Food Processing Industries

White Goods (ACs & LED): Department for Promotion of Industry and Internal Trade

High-Efficiency Solar PV Modules: Ministry of New and Renewable Energy

Automobiles & Auto Components: Department of Heavy Industry

Advance Chemistry Cell (ACC) Battery: Department of Heavy Industry

Textile Products: MMF segment and technical textiles: Ministry of Textiles

Specialty Steel: Ministry of Steel

Accelerating sustainabilityBy AGNIi

Among the challenges societies face pertaining to sustainable development and the environment, restoration and reforestation of land remain among the most demanding. These impact various aspects of the environment including soil erosion, pollution levels, and resource availability. While restoring the natural ecosystem of prior deforested land is an attractive prospect for sustainability, in practice a considerable degree of finesse is required to ensure that the restoration process is able to create a sustainable ecosystem.

To further this objective, AGNIi and Startup India partnered with World Resources Institute India (WRI India) as well as AIC Sangam to launch the second cohort of the Land Accelerator for South Asia. This program provided cash grants and other support to the top 60 innovators shortlisted. Specifically, they were eligible for:

3 months of weekly, exclusive, live weekly training

Templates to help your business thrive

Weekly group office hours to discuss how to apply the new concepts to your business

Weekly networking sessions to connect with and learn from other land restoration entrepreneurs in the accelerator

Opportunity to apply for one of 15 Land Accelerator Investment Packs

These Land Accelerator Investment Packs were granted to the top 15 innovators in the cohort and included support such as:

A 3,000 EURO Innovation Grant

An investment coaching meeting with a Land Accelerator organizer to develop an investment and innovation grant plan

A 90-minute group mentorship session with members of the Land Accelerator mentor network

An opportunity to present a 3-minute business pitch at the Land Accelerator Demo Day, an event that brings together the 15 grant recipients and business and social investors from across South Asia

AGNIi remains committed to furthering innovations for sustainability and granting the best of India’s innovators the opportunity to obtain the support they need to truly make an impact in meeting the country’s reforestation goals.

OPPORTUNITIES IN STATES

TRIPURA

Largest producer of bamboo in North-Eastern India

Tripura ranks #2 in Export Preparedness Index 2020 under Himalayan states category.

Tripura is primarily an agrarian State, with about 42% of the population depending on agriculture and allied activities. Rice is the major crop in the State. The climate of the State is suitable for a variety of horticultural/ plantation crops, including pineapple, jackfruit, tea, rubber, bamboo etc. The productivity level of food grain and rice in Tripura are 30% and 24% respectively more than all India levels. The yield of potato per hectare of land in Tripura is the highest in the NorthEastern region. The state is also a surplus producer of certified HYV paddy and mustard seeds, it has a seed replacement rate (SRR) of 33% for HYV paddy and 50% for mustard.

The state has established rubber, food and bamboo parks to support existing and potential investors. The State has 5 Industrial Estates, 1 Industrial area, 4 Public Sector Undertakings, and 2 growth centres. Tripura has

84% of its border common with the neighbouring country of Bangladesh. It is also the home for India's third international internet gateway (after Mumbai and Chennai).

UTTAR PRADESH

Longest road, rail and river network in India

Uttar Pradesh is the fourth largest state in India in terms of land area. The state's population of 200 Mn is equivalent to the population of Brazil.

Uttar Pradesh, described as the heartland of India, falls under the influence area of the first two of India’s dedicated freight corridors – Western Corridor running between Delhi & Mumbai and Eastern Corridor running between Ludhiana and Kolkata, connecting it with remote parts of the country.

The State is amongst the most popular tourist destinations in India with the presence of Taj Mahal, Buddhist places of pilgrimage such as Sarnath and Kushinagar and prominent Hindu pilgrimage places such as Prayagraj and Varanasi. The state was ranked first and third in terms of domestic and foreign tourist arrival, respectively, in 2019.

Uttar Pradesh has several locally specialised business clusters such as sports items in Meerut, brassware in Moradabad, perfumes in Kannuaj, leather in Kanpur, shoes in Agra, embroidered sarees in Varanasi, carpet in Bhadohi, chikan work in Lucknow etc.

Uttar Pradesh is known as the food basket of India as it is a leading producer of several food items. It is also the top manufacturing destination in India contributing more than 8% of national manufacturing output. The state is a leading electronic hardware exporter in the country and has also emerged as a key hub for IT/ ITeS and service sector including software, captive business process outsourcing (BPO) and R&D services.

UTTARAKHAND

Come as a visitor, stay as an investor

Uttarakhand is the most visited tourist destination amongst all hill stations in India. The state attracted close to 34.36 million domestic tourists and 0.13 million foreign tourists in 2017.

Uttarakhand located at the foothills of the majestic Himalayan mountain ranges is known for its pristine beauty and breath-taking locales. While the State has always been acknowledged as a tourism hub due to its snow covered peaks, gushing rivers, verdant valleys, untouched forests & the presence of major religious destinations, the young State has also emerged as one of the major investment destinations for manufacturing

in the country particularly in Automobiles, Pharmaceuticals & Food Processing due to its business friendly environment, conducive investment policies and simplified regulations.

The State has witnessed a Compound Annual Growth Rate (CAGR) of 10.34 % (between FY 2011-12 and 2018-19) mainly due to the growth of the manufacturing sector which now contributes to more than 33 % of the State GSDP.

The State offers an unbeatable combination of single point clearances, competitive land prices in world class Industrial Estates, cheap power, clean water, highly skilled manpower, good law & order, proximity to National Capital Region with its huge consumer base as well as dedicated relationship managers for investors to guide them through their investment life cycle. Its world-renowned education system, wild-life sanctuaries, peaceful & friendly people provide an unmatched quality of life to its residents.

A majorly organic State, the 4 Agro-climatic conditions allow the production of off-season vegetables and the State has the highest production of Pear, Peach, Plum, & Apricot in the country.

The State is rich in Limestone and has a huge potential for value added Industries.

Uttarakhand is being developed as an ‘Energy State’ to tap the hydropower electric potential of over 25,000 MW, 76.85 percent of the capacity owned by the State utilities, with an installed capacity of 1876.89 MW as of 29th Feb 2020. The State is striving to achieve its ambitious target of meeting 50% of its energy demand from renewable energy by 2023.

The state also offers tremendous opportunities in the Wellness & Tourism sector. In 2020, total tourist arrival in the State was over 39 million. Wellness is imbibed in Uttarakhand’s culture and it has the potential to emerge as the world’s “Wellness Destination”.

Uttarakhand has been consistently ranked amongst the top states in India by DPIIT in its assessment for ease of doing business. The State’s Investment promotion Agency (IPA) is adjudged as the “Top Performer” by Invest India, DPIIT, in the rankings for Investment promotion Agencies across 20 States in the Country. Moreover, Uttarakhand ranks #1 in Export Preparedness Index 2020 under Himalayan states category.

World Class Industrial Areas are developed by State Infrastructure and Industrial Development Corporation of Uttarakhand Ltd (SIIDCUL).

SOURCE: Invest India, National Investment Promotion & Facilitation Agency, Government of India