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Analyzing The Business Environment Of Madhya Pradesh (India): In Term Of

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Article · June 2017

DOI: 10.29368/FIIB.6.3.2017.3-11

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 Perspectives

Analyzing the Business

Environment of Madhya Pradesh in
Term of Opportunities
Jishnu Bhattacharyya & Manoj Kumar Dash
DOI:10.29368/FIIB.6.3.2017.3-11
Abstract
New firm creation resembles an engine of economic growth. Yet policymakers or macroeconomic administrators are often left
guessing when it comes to deciding what best they can do to promote new firms or extension of existing firms while utilizing
their resources in the best possible way. Even investors and entrepreneurs find great deal of difficulty in choosing where to
invest or where to start their business. A lack of comparable data creates problem for the policymakers in deciding on the
ways to improve the business environment that will boost the business environment of the country or the state. Similarly
investors find difficulty in choosing their right investment destination, since these data were not available and have not been
well understood. In the past this has resulted in a poor understanding of how to boost business environment in the states or the
country as a whole. India is a big country with a number of states and union territories. All the states and UTs are significantly
different from each other in terms of culture, history, socioeconomic status, and more importantly have different business
opportunities. Therefore, there is a need to analyze the business environment of each state and UT separately rather than
analyzing the business environment of the country as a whole. This will give a better and clearer image of the current business
environment across different states and UTs. This paper analyses the business environment of Madhya Pradesh, which is one
of the largest states of the country and is also centrally located. This paper shows the various opportunities available in the
state that can definitely boost and act as a catalyst for industrial development. It Intends to add value in the decision process
of the new investors in the state and present Madhya Pradesh as one of the most preferred business destination in the country.

Keywords
State Demography, Economic Development, State Resource, Government Policy, Ease of Doing Business

Introduction
Madhya Pradesh (MP) was founded on November 1st, 1956. It was bifurcated on 1st November, 2000 creating the
state of Chhattisgarh. MP enjoys the central location in India and thus has remained a crucible of historical currents from
North, South, East and West. Cultures that have flourished in the state along Narmada and other rivers are the Paleolithic,
Neolithic, Chalcolithic, Mesolithic, and even Iron Age culture. MP is the second largest state in terms of geographic share in
the country covering an area of 308,244 sq. km. with as many as 50 districts. As per the 2011 census, MP accounts to 6 %
of India’s population. State population has grown at 20.3 %, between the years of 2001 to 2011. Population density of the
state is 236 persons per square kilometer which is significantly lower as compared to the national average of 382 persons
per square kilometer.
After the bifurcation, the state has seen a better administration and greater attention is being given to the promotion
of new business, welcoming national and international investments, and developing an investor friendly ecosystem in the
state, especially with the recent entry of the new BJP led government and along with it an entry of series of new initiatives like
Make in India, Startup India, Stand Up India, Digital India etc. On all the key indicators, such as new investment in the state,
increasing employment, net value added in the ease of doing business in the state etc., the state has witnessed a growth in
performance in absolute terms. In aspects, like employment per unit, labor productivity, capacity expansion etc., the state’s
industry has performed slightly better than the national average and is continuing its growth steadily. Madhya Pradesh

Mr. Jishnu Bhattacharyya, MBA (Pursuing), Behavioral Economics Experiments and Analytics Laboratory (BEE&AL), ABV-IIITM, Gwalior,
Madhya Pradesh, India - 474001, E-mail : jishnubhattacharyyaeee@gmail.com
FIIBManoj
Dr. Business Review,
Kumar Dash,Volume 6 Issue
Assistant 3, July -Behavioral
Professor, SeptemberEconomics
2017 Experiments and Analytics Laboratory (BEE&AL), ABV-IIITM, Gwalior, 3
Madhya Pradesh, India - 474001, E-mail : manojdash@iiitm.ac.in

has generated employment through the growth of mainly
the small scale industry. It has seen a steady growth in
urbanization. The emergence of industrial clusters like
Bhopal, Indore, and Gwalior, made Madhya Pradesh a
destinations for intra state migration. The secondary
sector in Madhya Pradesh grew at 14.49% CAGR (2003-
04 to 2008-09), while generating a significant amount
of employment. The growth rate of industries (Which
includes mining along with the secondary sector) is
16.89 % CAGR over the five year period. Mining sector
has seen a growth at a CAGR of 107.83%. State economy
was driven by the service sector, thus contributing 39 %
to GDDP. The sector grew at 10.3 % (2003-04 and 2008-
09), predominantly driven by the hotels and restaurants
business across the popular tourism destinations and
city area along with the real estate business (www.ibef.
org).
Madhya Pradesh has enormous potential
for healthcare, tourism, pharmaceutical industry,
manufacturing, IT/ ITES and biomedical industries,
to name a few. Some of the renowned firms in Madhya
Pradesh are ACC (cement), Bajaj Tempo (automobile),
Mondelez (Cadbury India-confectionary), Eicher Motors
(commercial vehicles), Birla Corporation (power), Coca-
Cola (beverages), Grasim Industries (cement, textile
etc.), HLL (synthetic detergent), IPCA Laboratories
(pharmaceuticals), Sun Pharma (pharmaceuticals),
Impetus Infotech etc., to name a few. The industrial
panorama gives a positive impression, and reflects the
emergence of considerable potential for further growth
in the industrial sector of the state and also reflects a
huge potential for IT sector, especially for MNCs, in the
state which is relatively less explored.
Madhya Pradesh has been an investor friendly
state and has full support of the government as was
stressed upon by the Chief Minister of Madhya Pradesh,
Sri. Shivraj Singh Chouhan who has also emphasized that
the Make in India campaign has been successful in making
business and trading activities easier in the state, as well
as in the country, and has called it as the beginning of a
completely new economic era in the state and as well as
in India. Addressing a business seminar in China in June
2016 focusing on Investment opportunity in Madhya,
he highlighted the key aspects, in terms of advantage,
of investing in MP specifically in priority sectors like
pharmaceuticals, agri-business etc. MP is an easily
accessible state in the heart of the country and its GSDP
is steadily growing. The state has been revenue surplus
since 2004 and has been able to maintain the status till
date. The growth rate in tax revenues of Madhya Pradesh
FIIB Business Review, Volume 6 Issue 3, July - September 2017
Perspectives
was highlighted as 17 %. It was further detailed that MP
is having world class investment friendly infrastructure
and that the state has 230 developed industrial areas
which includes micro, small, medium enterprise, and
large industrial areas which also includes Chinese
Industrial Township at Pithampur in Dhar district. It has
world class investment friendly infrastructure with 230
developed industrial areas which includes micro, small,
medium enterprise, and large industrial areas which
also includes Chinese Industrial Township at Pithampur
in Dhar district. Large land resource is available for
new industrial investments at concessional rates for as
much as 30 years on lease. The government, Mr Chouhan
stressed fully supported new business in the state and
ensured to introduce more and more investor friendly
policies and upgrade the basic infrastructural facility of
the state.
Snapshot of Madhya Pradesh
Madhya Pradesh, central to the Indian landmass,
offers a range of opportunities to build, grow and
support various businesses across industry. The various
opportunities available in the state of Madhya Pradesh
are discussed as follows:
Abundance of Natural Resource
Availability of natural resource is a big challenge
throughout the world and is an important contributor
and support for any industry. Madhya Pradesh is one
of domestic producers of natural resources like coal,
limestone, copper, rock phosphate and glass sand, etc.
Coal reserve in Madhya Pradesh accounts for 14% of coal
reserve of India. Asia’s thickest coal seam is in Madhya
Pradesh, located in the district of Sidhi. Madhya Pradesh
has a huge reserve of limestone which serves as an
important element in construction materials. Madhya
Pradesh has rich availability of various important
varieties of stones from marbles to granite etc. Important
ingredients like manganese and dolomite in steel and
iron production is available. It is also the only state in
the country that produces diamond and is also a leading
domestic producer of agricultural products like gram,
soybean, wheat, onion, pulses and green peas. Madhya
Pradesh enjoys eleven different agro-climatic zones and
also accounts for 12% of Indian forest cover. It has a huge
potential for both solar photovoltaic and solar thermal
energies which is one of the most important and freely
available natural resource, the energy solution for the
future. Madhya Pradesh has a decent number of rivers
and other water bodies to facilitate industrial process and
4
 Perspectives
water requirements like Shipra river, Chambal river etc. ahead of many states when it comes to participation of
Madhya Pradesh has all the basic natural resources that the marginalized in business ownership as reflected in
are required to start any industry, be it an agricultural Figure 2 which shows significant contribution, in term of
firm, manufacturing firm, or service sector firm. business ownership, from SC and ST category population.
Demographic Profiling of Entrepreneurs Andaman and Nicobar Isln..
Andhra Pradesh
Male entrepreneurs are almost ten times that Arunachal Pradesh

of female entrepreneurs in Madhya Pradesh. As per the Assam

Bihar
Fourth All India Census of MSME of Unregistered Sector, Chandigarh
Chhattisgarh
2006-07 there are 1.01 lakhs female entrepreneurs as Dadar and Nagar Haveli
compared to 10.42 lakhs male entrepreneurs in Madhya Daman & Diu
Delhi
Pradesh. However, in comparison to the national average Goa

across states Madhya Pradesh ranks fourth in number of Gujarat

Haryana
female participation in business in terms of ownership, Himachal Pradesh
Jammu and Kashmir
behind Kerala, Karnataka and Andhra Pradesh. It suggests Jharkhand

an open welcome for new venture and an open and free Karnataka
Kerala
environment for women entrepreneurs to work in the Lakshadweep
Madhya Pradesh
state. MP may give a better environment for women Maharashtra

entrepreneur, since already a large number of women 0 5 10 0 1 2 3 4 0 1 2

entrepreneur exist in the state much large in number OBC (Numbrs in Lakh) SC (Numbrs in Lakh) ST (Numbrs in Lakh)

when compared with many other states (Figure 1). Source: State-Wise Enterpreneurship Profile : Enterprises Owned by
Andaman and Nicobar Isln.. 0.000
Andhra Pradesh 1.110
(Fourth All India Census of MSME: Unregistered Sector, 2006-07)
Arunachal Pradesh 0.060
Assam
Bihar
0.200
0.470
Figure 2. Caste wise Breakup of Ownership of
Chandigarh 0.060 Enterprises in India
Chhattisgarh 0.120
Dadar and Nagar Haveli
Daman & Diu
0.000
0.000
Availability of Educated and Skilled Manpower
Delhi 0.190
Goa 0.100 Madhya Pradesh has a huge local literate human
Gujarat
Haryana 0.160
0.570
resource to sustain new ventures or business manpower
Himachal Pradesh 0.110 requirements in the state. Though the percentage of
Jammu and Kashmir 0.120
Jharkhand 0.240 literate people in the state is low as compared with many
Karnataka
Kerala
1.860
2.310
other Indian states, there has been a significant increase in
Lakshadweep 0.000 the literacy rate, from 63.74% in 2001 to 69.32% in 2011.
Madhya Pradesh
Maharashtra 0.850
1.060
Due to its central location MP attracts talent from not only
0.0 0.2 0.4 0.6 0.8 1.0 1.2 1.4 1.6 1.8 2.0 2.2 2.4 2.6
the neighboring states but across the country. Every year
Female (Numbers in Lakh) more than ninety thousand engineering graduates and
even more general graduates (2,70,000+) across range of
Source: State-Wise Enterpreneurship Profile : Enterprises Owned by
(Fourth All India Census of MSME: Unregistered Sector, 2006-07)
specialization are passing out. As per Ministry of Human
Resources there are 2 central universities, 3 institute of
Figure 1. State-Wise Entrepreneurship Profile: national importance, 16 state universities, 1 State Open
Enterprises Owned by Females in 2006-07 University, multiple Open University study center, 7 state
private universities, 3 governments deemed university
As per 2011 Census, Madhya Pradesh which has etc. which accounts for more than 30 universities in the
a population of 7.27 Crores with 21.1 per cent Scheduled state and growing, as on 2013. Among these institutes
Tribes and 15.6 per cent strong Scheduled Caste there are good number premier institutes like Indian
population. Main SC castes in the state are Telis, Kurmis, Institute of Technology (Indore), Indian Institute
Lodhs, Ahirs and Rajputs etc. The main tribal groups in of Management (Indore), Indian Institute of Forest
Madhya Pradesh are Gond, Baiga, Bhil, Halba, Kaul, Mariya Management(Bhopal), National Law Institute University
Korku, Sahariya, and Bhariya. However this diversified (Bhopal), IISER (Bhopal), National Institute of Technology
population does not seem to have significant effect in (Bhopal), IIIT (Jabalpur) and ABV-IIITM, Gwalior to name
business environment of the state due to widespread and a few. This rich number of higher education institutes
which accounts for more than 1,600 institutions in the
prevalent discrimination. People from the lower castes
state empowers huge number of educated and skilled
often don’t get proper opportunity to grow and build manpower that will serve the purpose of human resource
their own business. Despite thus Madhya Pradesh is far for the new ventures (Figure 3).

FIIB Business Review, Volume 6 Issue 3, July - September 2017 5

 Perspectives

1602

Source: http://censusmp.nic.in

Figure 3. State/UT wise Number of Higher Education Institutes in India, 2012-13

EDP based Opportunities business, encouraging new business, act as a facilitator by

providing relevant information etc. that have significant
Entrepreneurial Development Program or EDP is
impact in business growth. MP has seen significant
conducted to help a potential entrepreneur to strengthen
increase in the number of such training and the number
his/her entrepreneurial journey by imparting required
of beneficiary of such training as indicated in Figure 4,
skills and capabilities required to build, grow, sustain,
thus creating an entrepreneurially favorable environment
promote and run an enterprise efficiently and effectively.
in the state. The Madhya Pradesh Council of Science
It also includes motivational sessions that have significant
and Technology, Madhya Pradesh Entrepreneurship
impact on behavioral and entrepreneurial value. There
Development Institute and the Madhya Pradesh
are a number of such programs across range of modules
Consultancy Organization are engaged in developing
which give information to the prospective entrepreneurs
suitable orientation programs for entrepreneurs with
regarding business idea implementation, how to set up
special emphasis on promoting entrepreneurship among
a new enterprise/company/start up, how to manage
members of SC, ST, Other Backward Classes, and those
finance, how to manage human resource, how to market
Below the Poverty Line (BPL) with special focus on
product, sources of investments, government policy
women.
and schemes, etc. Thus EDP helps in establishing new

FIIB Business Review, Volume 6 Issue 3, July - September 2017 6

 Perspectives
Measure Names
No of Beneficiary
Year No of Training
2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012 2012-2013 2013-2014
12K
347
10,491

10K

8K
Value

6K

4K 104
3,199
79
64 70 2,464
2K 2,000 56 54 65
1,912
1,680 1,500 1,595
32
800 347
32 64 56 54 65 70 79 104
10,491
0K 800 2,000 1,680 1,500 1,595 1,912 2,464 3,199
No of Beneficiary

No of Training

No of Beneficiary

No of Training

No of Beneficiary

No of Training

No of Beneficiary

No of Training

No of Beneficiary

No of Training

No of Beneficiary

No of Training

No of Beneficiary

No of Training

No of Beneficiary

No of Training

No of Beneficiary

No of Training
Source: https://data.gov.in

Figure 4. Number of Training and Corresponding Number of Beneficiary - EDP in MP

Business Opportunities in MP: Ease of Doing allows online application, status tracking, scrutiny of
Business drawings, uploading remarks/reports/photographs via
mobile during site inspections, calculation of fees and
One of the most significant issue is the land
availability for industrial growth and this often creates online payment, issuance of final certificate, and MIS or
huge problem as in the Singur case in West Bengal. The Management Information System.
land availability in the state is as much as 16000 hectares Starting a Business
which is suitable for setting up new business/ industry
with promising power policy for industries across cities Data from World Bank’s Doing Business in India
of Madhya Pradesh (total electricity generation capacity Report 2009 suggests that it take far lesser time to start
of MP is 6,449.25). Only two documents are required for a new business in Madhya Pradesh when compared to
electricity connections for industrial or business use in the many other states in the country. For instance Indore takes
state and pollution control certificates are not required lesser time to start a new business when compared with
(though encouraged to have one), thus supporting ease of Bengaluru, Kochi etc. as depicted in Figure 6. This may be
doing business. The state also allows the industrial units due to many factors like relatively simple government/
to have captive power plants to produce power as per legal processes, land subsidy for mega projects (75%; on
their requirements premium) and single table clearance for mega projects
The state has also introduced a Comprehensive through Project Clearance Implementation Board (PCIB)
Automated Building Plan Approval System (ABPAS) that etc.

FIIB Business Review, Volume 6 Issue 3, July - September 2017 7

 Perspectives
Economy Economy
Ahmedabad Ahmedabad
Bangaluru Bangaluru
Bhbuaneshwar Bhbuaneshwar
Chennai Chennai
Gurgaon Gurgaon
Guwahati Guwahati
Hyderabad
Hyderabad
Indore
Indore Economy Indore Jaipur
Jaipur Time - Men (days) : 32.00 Kochi
Kochi Kolkata
Kolkata Ludhiana
Ludhiana Mumbai
Mumbai New Delhi
New Delhi Noida
Patna
Noida
Ranchi
Patna
Ranchi 0 200 400 600 800 1000 1200 1400 1600 1800 2000 2200 2400 2600 2800

0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42 Cost (%of warehouse value)

Time - Men (days)
Source: http://www.doingbusiness.org/data/exploreeconomies/india Source: http://www.doingbusiness.org/data/exploreeconomies/india
Figure 5. Time Involved in Starting a Business, 2009 Figure 7. Cost Involved in Dealing with Construction
Permits across Cities in India, 2009
Dealing with Construction Permits
It is this ease of doing business that the state
India is infamous for its lengthy and time offers which has resulted Madhya Pradesh topping the
consuming bureaucratic procedures. The cost of states when it comes to allotment of land and obtaining
compliance in terms of all the procedures such as building construction permit. The state also scores high on
a warehouse and obtaining utility connections is not only registering and complying with tax procedures, as per
high across India, but also is varied. When it comes to the Assessment of State Implementation of Business
dealing in construction permits cities of MP like Indore Reforms, (September 2015).
takes 163 days on an average to provide required clearance 0.00% 20.00% 40.00% 60.00% 80.00% 100.00%

much ahead of cities like Kolkata, Guwahati, etc. When Madhya Pradesh 72.73%

it comes to cost related to construction permits, cities of Gujarat 72.41%

MP like Indore gives a high competition to a number of Maharashtra 70.27%

industrial cities across the country. Patna and Indore with Rajasthan 63.64%

a cost of 205% of income per capita are the cheapest cities Andhra Pradesh 62.16%

in India for building company. Kolkata and Mumbai are

Source: Assessment of State Implementation of Business Reforms, September 2015
costly at approx. 2600% of income per capita. This hastens
the process of setting up a venture (Figure 6).
Figure 8. Allotment of land and Obtaining
Construction Permit
Economy
0% 20% 40% 60% 80% 100% 120%
Ahmedabad
Karnataka 97.73%
Bangaluru
Bhbuaneshwar Andhra Pradesh 90.63%
Chennai
Gurgaon Rajasthan 89.47%
Guwahati Odisha 85.29%
Hyderabad
Indore Madhya Pradesh 82.50%
Economy Indore
Jaipur
Time(days) : 163.00
Kochi
Kolkata Source: Assessment of State Implementation of Business Reforms, September 2015
Ludhiana
Mumbai Figure 9. Registering and Complying with Tax
New Delhi Procedures
Noida
Patna Registering Property
Ranchi

0 20 40 60 80 100 120 140 160 180 200 220 240 260

Time and cost spent on registering a property
Time (days) has implications for starting up a business. Registering
Source: http://www.doingbusiness.org/data/exploreeconomies/india a property in Indore takes, on an average, 39 days which
give stiff competition to cities like Mumbai, Chennai etc.
Figure 6. Time Spend on Dealing with Construct and also offer a decent competition in terms of cost which
Permits, 2009 enables businesses to set up rather easily (Figure 10).

FIIB Business Review, Volume 6 Issue 3, July - September 2017 8

 Perspectives
Economy
Economy Ahmedabad
Ahmedabad Bangaluru
Bengaluru Bhbuaneshwar
Bhubaneshwar Chennai
Chennai Gurgaon
Gurgaon
Guwahati
Guwahati
Hyderabad
Hyderabad
Indore Economy Indore
Indore
Economy Indore Jaipur Cost (96 of property value): 10.70
Jaipur
Time(days) : 39.0 Kochi
Kochi
Kolkata Kolkata
Ludhiana Ludhiana
Mumbai Mumbai
New Delhi New Delhi
Noida Noida
Patna Patna
Ranchi Ranchi
0 10 20 30 40 50 60 70 80 90 100 110 120 130
0 2 4 6 8 10 12 14 16 18 20 22 24 26
Time (days) Cost (% of property value)
Source: http://www.doingbusiness.org/data/exploreeconomies/india Source: http://www.doingbusiness.org/data/exploreeconomies/india

Figure 10. Time Spent on Registering Property, Figure 11. Cost involved in Registering Property,
2009 2009
150.4 Forecast Indicator

140 Actual
134.6 Estimate
120
120.4

100 107.7
96.4
US$ Billion

80 74.8 86.2
66.5
57.7 68.5
60

40.1 48.1
40 42.8
32.0
20 25.2 28.2

0
2005 2006 2007 2008 2009 2010 2011 2012 2013 2104 2015 2016 2017 2018 2019 2020
Year (2004-5 to 2019-20)

Figure 12. Economic Snapshot: GSDP Forecast for Madhya Pradesh Source: http://ibef.org

Other Accelerating Key Factors 89 industrial units with investment of Rs. 4800 crores
were setup during the year 2003-04 and 2008-09 and
India is one of the most progressive economies in the year 2009-10, Rs, 3500 crore was invested on
in the world and Madhya Pradesh is one of the fastest 30 industrial units. In MP, a total of 8 IIDs (Integrated
growing states in the country with a promising CAGR of Infrastructure Development Centre) are being setup. This
more than 9% and the GSDP for the year 2020 may be as signifies that Madhya Pradesh has been trying to achieve
high as 150.4 Billion US$ (Figure 12). the benchmark standard in industrial development since
With two hundred thirty-one recorded industrial long, and that it’s not a sudden change in Madhya Pradesh
areas, nineteen growth centers, four notified Special due to the current government. The current government
Economic Zones (SEZs) and twelve product specific and with its policies is accelerating the industrial growth
industrial parks to facilitate industrial investments, in the state. This put forward the consistency of the state
clearly reflects the government’s dedication in developing in industrial development policies.
the industrial ground in the state. In the recent past Geographically central to the Indian landmass,
the state has witnessed significant growth in large and MP enjoys an easy access to many tier one cities, major
medium industrial sector industries and as many as markets and important industrial areas of Delhi, Mumbai

FIIB Business Review, Volume 6 Issue 3, July - September 2017 9


etc. The impressive connectivity of the state with a robust
road network of more than one lakh kilometer, number of
airport (a total of 5 operational airports), rapid transport
system in cities like Indore, extensive railway network
and being near to Mumbai port etc. (twenty national
highways are passing through the state) acts as a catalyst
in the development of industry in the state. International
airports are proposed in Indore and Bhopal. Indore
airport of MP has the capability of handling international
cargo. The huge consumer market of MP represents a
population of over 70 million people with urbanization
growth rate of 26% with bigger cities growing as high
as 40% per decade indicating towards a huge consumer
market potential in the state.
The state also offers a range of financial policies
like fiscal incentives for Industries (for example in textile
industry like new textile units will be given an investment
subsidy of 10% of eligible capital investment of up to INR
10 million) and according to Industrial Promotion Policy
2010 (amended in 2012), it assist new business through
its industrial promotion schemes like entry tax exemption
up to nine years. The state also has a Single Window
Secretariat for investment facilitation like MPTRIFAC
and TRIFAC and gives reimbursement for expenditure in
obtaining ISO 9000 Certification.
The ‘cost’ is an crucial factor for any industry like
cost of manpower, cost of land etc. MP provides budget
friendly manpower when compared with metros and MP
has the potential to provide low cost land for business.
It is also having provision to lease land for up to 30
years. Availability of suitable land to setup industries
is a crucial factor for any business ecosystem. The cost
of land also determines the initial capital requirement.
States like Delhi and cities like Gurgaon, Bangalore are at
disadvantage of high land cost. Further, special schemes
and concessions for tourism projects are also available.
20
18
16
14
12
10
80
60
40
20
0 With the support given by the current business
MP SEZ Noida Manesar Faridabad Gurgaon Gurgaon
4 Indore 35 55 60 PH VI PH VI
18 110 110
Land Cost Advantage
Source: http://www.mpsidc.com/costadv.html
Figure 13. Average Land Cost-MP vs Other Major
Business Hubs
FIIB Business Review, Volume 6 Issue 3, July - September 2017
Perspectives
MP facilitates minimum water shortage for
industrial use as well as personal consumption. Water is
a basic requirement for the sustenance of any industry
and its human resource. MP, though has a relatively dry
climatic conditions, has significantly overcome its water
shortage. Kumar (2001) explains how empowering the
people has enabled the government to overcome difficult
water shortage situations. Madhya Pradesh enjoys a great
advantage of being free from traffic hazards reducing
transportation problems across cities like Gwalior, unlike
metros like Kolkata.
With a stable government and peaceful work
environment and various other factors like dedicated
department and budget for digitalization of the state
(Digital India) and for promoting Make in India policy
etc., to name a few, the state is climbing high to meet the
superior standard in term of ease of doing business. The
state is mainly focused on automobile industry, textiles
industry, tourism industry (MP offers diverse tourists
destinations such as religious (Bhojpur), adventure
(Panchmari), etc.), information technology and business
process industry, healthcare sector, pharmaceutical
industry, biotechnology etc. Madhya Pradesh is also
ranked 10th among the Indian states and union territories
by GDP (Nominal GDP -INR `7.35 lakh crore) and is
comparable with the economies like Morocco. This
presents Madhya Pradesh, as a competitor for a number
of economies worldwide.
Conclusion
Business environment development is essential
for the purpose of rapid and sustained economic growth.
It aids in producing the required skilled human resource
to accelerate growth while reducing unemployment
and poverty. The government needs to build an investor
focused and investor friendly environment while framing
stable government policies and ensuring good governance
in the state and also develop an entrepreneurial attitude
in its people so that they see entrepreneurship as a
career option and contribute to the economy of the
state. Government needs to enhance the infrastructural
facilities in the state on a continuous basis. There is an
increasing need to ensure financial support to budding
entrepreneur and help actualize dream or plan and thus
converting the ideas into a reality.
environment in the state of Madhya Pradesh, it is currently
and also in coming days will experience the emergence
of new firms across sectors, with qualitative superiority,
technologically vibrant and national/ internationally
competitiveness. There is no doubt that business
environment of MP plays a fundamental role in utilizing
and adding value to its resources while welcoming new
10

ventures with an open arm. This study will certainly help
the policymakers in deciding on the ways to improve
the business environment that will boost the business
environment of the country or the state and similarly
industrial investors (including foreign investor) will
have a broader idea on the business environment of the
state and the study will help them in choosing their right
investment destination.
References
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Author Profile
Mr. Jishnu Bhattacharyya, Behavioral Economics Experiments and Analytics Laboratory (BEE&AL), is pursuing his Masters in Business
Administration from ABV-Indian Institute of Information Technology and Management, Gwalior. He received his B.Tech in Electrical and
Electronics Engineering from West Bengal University of Technology, Kolkata. His research interests include data driven decision making and
analytics, techno-managerial research and information technology management. He had published research papers in international and
national journals and conferences of repute like that of IIT and NIT, etc. He can be reached at jishnubhattacharyyaeee@gmail.com.

Dr. Manoj Kumar Dash is Assistant Professor, Behavioral Economics Experiments and Analytics Laboratory (BEE&AL), ABV-Indian Institute
of Information Technology and Management, Gwalior. He earned his M.A. with specialization in Econometrics, M.Phil. with specialization
in Econometrics, Ph.D. in Economics on the topic ‘Econometrics of Complete Demand System’ and M.B.A. in Marketing from Berhampur
University, Berhampur (Orissa). He has published more than 67 research paper in various journals of International and National repute. He
is the author of three books and edited five books till date. He was involved as Chair Member in International Conference of Arts and Science
held at Harvard University, Boston (USA). He has conducted 22 Faculty Development Pogramme sponsored by AICTE, MHRD and IIITM on
Multivariate Analysis, Econometrics, Research Methodology, Multi-Criteria Optimisation, Multivariate analysis in Marketing, SPSS software
etc. He can be reached at manojdash@iiitm.ac.in.

FIIB Business Review, Volume 6 Issue 3, July - September 2017 11

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