INDUSTRIAL INVESTMENT IN SIKKIM

            The State has a huge potential for industry in areas where the State enjoys a comparative advantage. The major endowments of the State are its nature and natural resources. Flora and fauna, and the people. The State has also a huge potential for hydel power. The prospect of opening up of the border trade through Nathula poses both challenges and opportunities for the State. It is in this context that the importance of industry and trade lies in optimal use of its resources and making the most of the emerging opportunities to realize the State’s potential of industry and trade which would ensure smooth transition of the State from being overwhelmingly dependent on the public sector to a vibrant economy based on private sector initiative, enterprise and entrepreneurship.

              Choice of appropriate industries are largely based on the availability of raw materials within the State. However, the crucial inputs that the State can make available for industry are its manpower, rich varieties of flora and fauna and various horticultural produce. Sikkim has a potential for medicinal herbs.  

            Sikkim is a politically stable State with virtually no law and order problem as people are peace loving. The State does not suffer from any labour related problem either. Sikkim probably is the only State in the north-eastern areas, which is free from any insurgency related problems. The friendly environment and pollution free atmosphere is absolutely conducive to investment. There could not have been a better situation.

              Given the fragility of the eco-system, the approach towards industry is a cautions one and primarily environment friendly. Industries should be entirely pollution free and effluents should be bare minimum with nature friendly disposal of wastes. The strategy would be to build on State’s comparative advantages in terms of raw materials and cheap labour surmounting State’s handicaps. In other words, promotion of the industries should be in tune with the development strategy.

            As per the Tenth Five Year Plan document and the Industrial Policy of the State, possible thrust areas have been identified in consonance with the long-term development strategy that the State is pursuing. They are as follows :

              a) Agro based industries horticulture and floriculture (b) minor forest based industries (c) animal husbandry and dairy products (d) tourism related industries (e) information technology including knowledge based industries (f) precision oriented high value low volume products (g) hydel power (h) tea (i) education and (j) hospitality etc.

              However, the State has focused on certain key industries based on their potentials for employment generation, relative comparative advantage, and overall impact on the State economy.

             Given the large share of agriculture and allied activities in State income, proven potential in producing commercial crops and untapped potential in flora and fauna, potential of agro-based industries is enormous. The primary advantage of the agro-based industries is the availability of necessary raw materials in the State.  

Floriculture has a high potential as demand in India and abroad would continue to grow. The State produces varieties of orchids, gladioli, anthuriums and rhododendrons. Commercial cultivation is rapidly picking up. However, storage and marketing remain crucial for successful venture. Given paucity of land, the possibility of cooperative type cultivation of orchids needs to be explored.

              The food processing industry is competitive in presence of large and established producers. The State specializes in mandarin oranges, ginger, tea and cardamom. In terms of prospect, medicinal and aromatic herbs will face an ever-expanding market both nationally and internationally. The varieties of medicinal plants available in the State need to be taken stock of. Wool and silk reeling, weaving and processing, and rabbit farming, all these activities may be carried out at the farm level and they may be treated as the primary or secondary sources of livelihood. The marketing constraint seems to have deterred the development of these industries. The objective would be to provide people with multiple sources of income.

              Ideal climate and natural beauty of the State augurs will for the tourism industry in the State. The green image of the State with emphasis on village tourism has made the State an attractive destination both nationally and internationally. Though the concept of eco-tourism is yet to be found popular among the majority of the tourists. The multiplier impact of tourism with immense potential for employment generation in a regionally balanced manner would make tourism the leading industry the State should be focusing on.

              The State has already made great strides in the knowledge-based industries such as Information Technology. The State can gain from the advantage of skilled manpower, which has shown potential for the IT industry. Moreover, given the climate, promotion of knowledge-based industries would enable the State to bypass most of the handicaps the State is afflicted with. A software technology park is being set up which will have wide-bandwidth, stable power supply and incubation space for entrepreneurs. The Department is also promotion IT enabled services like medical transcription, telemedicine, computerized Braille etc.

              In line with the argument for development of education industry, the promotion of healthcare industry can also fetch good returns for the State. The ideal climate coupled with easy availability of non-medical support staff can make Sikkim an ideal destination for the health care industry. Availability of medicinal herbs and herbal treatment including yoga, meditation, spa and message, would further contribute to the credence of the State in the healthcare industry. The State is in the process of air connectivity, the healthcare industry may focus on treatment of those suffering from non-critical illnesses and may require prolonged treatment or those who are recuperating.

              Handicrafts and handloom industry has the potential to promote income and employment generation in a big way. The high quality traditional handicrafts and handloom products enjoy a good market, both nationally and internationally. The traditional crafts like carpet weaving, cane and bamboo crafts, spinning wool, handmade paper and Thanka paintings are famous and enjoy government patronage in as far as training is concerned. A proficient manpower base is already available in this field. All that is required is expertise to be organized so that quality and  design  can be  upgraded.  Professionals in the field of marketing and supply could work wonders with this traditional industry of Sikkim. However, marketing of the product depends on growth of tourism promotion outside the State by the Government and adequate supply of input and infrastructure support. Gangtok Craft Fair and modernization of looms are steps in the right direction. Sikkim has to focus on “product differentiation” as Sikkim faces competition from other north-eastern States.

              Hydel power is another prioratised area that has tremendous potential. The capacity to tap 8000 MW of hydel power is there for the asking.  

            The State Government has already identified areas for setting up of growth centres. The new Industrial policy, provides a list of locations for setting up of the new industrial units. The Government has already declared Rangpo-Gangtok, Melli-Jorethang and Jorethang-Rishi and Ranipool-Gangtok as industrial corridors for giving the land to the investors on a lease basis.

              The developed land will be allotted on a lease basis for a period of thirty years. The State Government will subsidise the cost of land depending on the nature of industries. For small-scale industries, it is 25 percent, export oriented units and units managed by local entrepreneurs at the rate 30 percent and large and medium units at the rate of 15 percent. Other than this, one more option the State can think of is to ensure that the landowners are made partners in business.

                          In certain areas, the State can invite the market leaders where large investments are required to make them competitive. Furthermore, the leaders can bring with them expertise and knowledge. Exploring market would cease to be a problem  for  the   enterprises.  This  would   be  relevant  for industries such as education and healthcare industry, production of medicinal herbs etc, hydro power, tourism etc.

              Given the background of the industrial scenario in Sikkim, the Department of Commerce & Industries, Govt. of Sikkim has embarked on a road map for industrialization in the State of Sikkim. The State is very conscious of the ecology and its environment.

  With the opening of the border trade through Nathula Pass, we have approximately 80 investors who have applied for license in various manufacturing units, which is also capital and labour intensive and the Department is processing their documents accordingly, through a single window system. The Government is according all priority to expedite investment.

              With this situation, the State can definitely look forward to a great deal of employment opportunity and revenue generation with the type of industries set up in Sikkim. Moreover, the long term benefit both for the investor and the Government is enormous.

              Further, with the new Industrial Policy, the fiscal incentives and various incentives, and with the pro-active policy of the Government, an era of industrialization in Sikkim has already begun, which is ready to tapped.

10 REASONS WHY YOU SHOULD CONSIDER INVESTMENT IN SIKKIM - 

ü      Most peaceful state in the country.

ü      Availability of quality power supplies.

ü      Abundant water.

ü      Harmonious Labour relationship.

ü      All four districts are "No Industry District".

ü      Availability of technical/skilled man power.

ü      Investors friendly atmosphere.

ü      Superb transportation and communication network.

ü      Attractive packages of incentives. 

THRUST AREA OF INVESTMENT. 

ü      Eco-Tourism including Hotels, Resorts, Spa, Amusement Parks and Rope ways.

ü      Handicrafts & Handlooms.

ü      Wool and silk reeling, weaving & processing, printing etc.

ü      Floriculture and Horticulture.

ü      Precision Engineering including watch making.

ü      Electronics including computronics hardware & software and IT related industries.

ü      Food processing including Agro-based industries. Processing, Preservation and packaging of fruits and vegetables (excluding conventional grinding/extraction units).

ü      Medicinal and aromatic Herbs-Plantation & Processing.

ü      Raising & Processing of Plantation Crops i.e. Tea, Oranges & cardamom

ü      Mineral based industry.

ü      Pharma products

ü      Honey

ü      Biotechnology