Kerala Report

State Level Resources to Promote the Growth of Manufacturing in Kerala
State Level Actions

to
Promote Growth of Manufacturing
(Resources and Capability Review)
Kerala
Prepared for
National Manufacturing Competitiveness Council
CENTRE FOR RESEARCH, PLANNING & ACTION

July, 2012
Though all care has been taken as to authenticity of various data

sources and accuracy of various presentations responsibility for any
errors that may remain as well as for opinions expressed lies with
Centre for Research, Planning & Action, New Delhi the agency that
carried out this study on behalf of NMCC.
Table of Contents
Table of Contents .............................................................................................................. 3
List of Tables ..................................................................................................................... 4
List of Figures .................................................................................................................... 5
List of Annexure................................................................................................................ 5
1.
State Profile ................................................................................................................ 6
2.
Land for Industrial Purpose ................................................................................... 11
3.
Basic Infrastructure ................................................................................................ 16
4.
Profile of Logistics ................................................................................................... 18
5.
Trends of Industrial Production ............................................................................ 24
6.
Profile of Existing Industries .................................................................................. 31
7.
Raw Materials .......................................................................................................... 34
8.
Skill Profile of Manpower ....................................................................................... 35
9.
Profile of Business Environment ............................................................................ 41
10. Incentives and Schemes........................................................................................... 50

11. Conclusions and Core / Thrust Areas.................................................................... 52
List of Tables
1.1: Administrative Units in Kerala ................................................................................ 8
1.2: Districts of Kerala & Areas ...................................................................................... 8
1.3: Key Demographics of Kerala.................................................................................... 9
1.4: Share & Growth Rate of Manufacturing Sector in Kerala GSDP (Current
Prices) ............................................................................................................................... 10
2.1: Land Use Pattern in Kerala .................................................................................... 11
2.2: District-wise Waste Land in Kerala ....................................................................... 12
2.3: Industrial Parks of Kerala Industrial Infrastructure Corporation (KINFRA) 14
2.4: Major Industrial Estates District Wise ............................................................... 14
2.5: Kerala SIDCO Industrial Parks in Kerala District Wise ................................. 15
3.1: Total Generation Capacity in Kerala .................................................................... 16
4.1: Ports in Kerala ......................................................................................................... 18
4.2: Road Network in Kerala ......................................................................................... 19
4.3: Communications Snapshot of Kerala .................................................................... 23
5.1: Key Industries in Kerala ......................................................................................... 24
5.2: District-wise Distribution of Operating Factories ................................................ 24
5.3: Industrial Clusters in Kerala .................................................................................. 25
5.4: Time-Series Data Showing Growth in Past 5 Years in Kerala ............................ 28
5.5: Gross Capital Formation for the State of Kerala ................................................. 29
6.1: Number of SME Units Operating in Kerala (Mar, 2011) .................................... 31
6.2: MSME Clusters in Kerala ...................................................................................... 32
6.3: Sanctioned MSME Clusters under MSE-CDP Scheme in Kerala (As on
30.6.2011) ......................................................................................................................... 32
7.1: Mineral Production in Kerala (2009-10) ............................................................... 34
8.1: Technical Education Institutions in Kerala (2010) ............................................... 36
8.3: Percentage Share of Professional & Technical Work Seekers in Kerala ........... 38
8.4: Labor Strikes Over the Year in Kerala ................................................................. 39
8.5: Company Lockouts over the Years in Kerala ....................................................... 39
9.1: Single Window Clearance Process in Kerala ........................................................ 42
9.2: No. of Applications Cleared/Disposed Since Inception ........................................ 42
9.2 Special Agencies to Facilitate Industrialization ..................................................... 43

9.2: SWOT Analysis of Kerala Industrial Environment ............................................. 48
10.1: Project Lending Pre-requisites for KSIDC Financing ....................................... 51
List of Figures
Figure 1.1: Map of India Showing the Location of Kerala ........................................... 7
Figure 1.2: Sector Contribution to Kerala GSDP ........................................................ 10
Figure 3.1 Road Network of Kerala .............................................................................. 17
Figure 4.1: Railway Network in Kerala ........................................................................ 21
Figure 4.2: Airports in Kerala ....................................................................................... 22
Figure 6.1: Industry-wise State Public Sector Units in Kerala ................................... 33
List of Annexure
Annexure 1: Industry-wise Contribution to GSDP and Growth Rates ..................... 54
Annexure 2: Industrial Land with Directorate of Industries ..................................... 55
Annexure 3: Mini Industrial Estates in Kerala: District Wise ................................... 56
Annexure 4: Mineral Resources & Availability in Kerala .......................................... 57
Annexure 5: Ratio of the State on Key Characteristics of Overall and in
Manufacturing sector for India and Kerala ................................................................. 58
Annexure 6: Distribution of factories by employment in overall and manufacturing
sector in Kerala ............................................................................................................... 59
Annexure 7: Estimate of selected characteristics of factory sector by 3-digit industry
group (NIC-2008) for Kerala ......................................................................................... 60
Annexure 8: Engineering Colleges Intake in Kerala (2010-11) .................................. 63
Annexure 9: Trade Wise Intake in Polytechnics in Kerala (2010-11)........................ 64
Annexure 10: Select Manufacturing Sector Wages Rates in Kerala ......................... 65
Annexure 11: Cost of Doing Business in Kerala .......................................................... 68
1.
State Profile
1.1
Introduction
1.1.1
The State has seen an average industrial growth rate of 10.56 percent at constant
prices in the last 5 years. The contributions of manufacturing sector to GSDP at constant
and current prices are 9.26 per cent and 9.33 per cent respectively during 2009-10. Some
of the key industries in the state include Handlooms & Power-looms, Rubber / Bamboo /
Coir Based Industries, Food Processing, etc.
1.1.2
The State Government has provided special support to MSMEs due to its high
employment and economic growth potential. This sector contributes greatly towards
domestic needs, export marketing and foreign exchange earnings by producing varieties
of products ranging from traditional to high tech. As on March 2010, there were about
213740 SSI/MSME units registered with a total investment of Rs. 731212.13 and direct
employment generation of 8, 31,847. Majority of the SME units operate in the Wood
Based, Food Products, Readymade Garments and General Engineering sectors.
1.1.3
For more information visit:
http://www.kerala.gov.in
http://www.ksidc.org
http://www.keralasidco.com
http://www.ibef.org/states/kerala.aspx
1.2 Location and Area

1.2.1
Kerala is located along the coastline, to the extreme south west of the Indian
peninsula, flanked by the Arabian Sea on the west and the mountains of the Western
Ghats on the east. The total area of the state is 38,863 sq km and encompasses 1.18 per
cent total land of India.
Figure 1.1: Map of India Showing the Location of Kerala
The nature of the terrain and its physical features, divides an east west cross section of
the state into three distinct regions- hills and valleys with an average elevation of 1500
meters, midland and plains and the coastal region. Western Ghats is the origination of
about 44 rivers that flow in the state, 41 of which flow towards west into Arabian Sea and
3 are tributaries of River Cauvery. In the Midland Plains of central region, the hills have
slightly steep with wide valleys allowing agriculture. The Coastal Belt strip is
comparatively plain with extensive paddy fields, thick groves of coconut trees and
backwaters, interconnected with canals and rivers.
1.3 Administrative Units
1.3.1
The State of Kerala is divided into 14 Districts. Following are the administrative
units in Kerala.
1.1: Administrative Units in Kerala

Districts
Revenue Divisions
District Panchayats
Taluks
CD Blocks
Revenue Villages
Gram Panchayats
Corporations
Municipalities
Region
North Kerala
Central Kerala
South Kerala
1.2: Districts of Kerala & Areas

Districts
Kannur
Kasaragod
Kozhikode
Malappuram
Wayanad
Ernakulam
Idukki
Palakkad
Thrissur
Alappuzha
Kollam
Kottayam
Panthanamthitta
Thiruvanthapuram
14
21
14
63
152
1453
978
5
60
Area (Sq.Kms)
(Sq.
kms)
2966
1992
2345
3550
2131
2931
4479
4480
3032
1414
2498
2203
2462
2192
1.4 Demographic Information

1.4.1
The state has high density of population and the number of females per males is
the highest in the country. Table 1.3 lists the key demographics of the state.
Population
1.3: Key Demographics of Kerala

3,33,87,677
Male
1,60,21,290
Females
1,73,66,387
Sex Ratio
1,084
Population Density (Per Sq.Kms)
859
Literacy Rate
93.91%
Male
96.02%
Females
91.98%
Source: Census 2011
1.5 Economy of the State

1.5.1 The States economy is predominantly agrarian in nature. The Gross State Domestic
Product (GSDP) at factor cost at constant (2004-05) prices has been estimated to be
181289.12 crores for the year 2009-10, registering a growth of 9.73% over the previous
year. At current prices the GSDP is estimated to be 230315.55 crores during 2009-10,
registering a growth rate of 14.57% over the previous year.
1.5.2 The per capita State Income is estimated to be Rs. 52,984 as compared to national
income of Rs. 38,155 for 2009-10 at constant (2004-05) prices.
1.5.3 The contribution of primary sector has been decreasing and tertiary sector has been
increasing over the years, with the secondary sector remaining almost stagnant. Majority
of the economic growth in the State is due the growth in the tertiary sector. Table 1.4
lists the contribution of the three key sectors to the State GSDP.
Figure 1.2: Sector Contribution to Kerala GSDP
Constant (2004-05) Prices
Current Prices
1.5.4 Annexure: I gives details on Industry-wise contribution of State GDP. Table 1.5
specifically highlights the contribution of Manufacturing Sector to the State GDP. From
the data we see that the share of Manufacturing Sector has been increasing and is also
showing higher growth rates year-on-year.
1.4: Share & Growth Rate of Manufacturing Sector in Kerala GSDP (Current
Prices)
Sector
2007-08
Growth
2008-09 Growth
2009-10 Growth
Manufacturing
15082.23
Rate (%)
8.61
Rate (%)
17865.66 8.89
Rate (%)
21477.11 9.33
Registered
6437.81
3.68
7712.89
9464.67
Unregistered
8644.42
4.94
10152.77 5.05
3.84
4.11
12012.44 5.22
Source: Economic Review 2010
1.5.5 In terms of Human Development Index and life standard of the people, Kerala is
much ahead of the most other states in India, and in fact in certain development indices, it
is on a par with some of the developed countries. This peculiar paradox often termed as
the KERALA PHENOMENON or Kerala model of development by experts, which is
mainly owing to the performance of the State in the Service Sector.
Visit: www.kerala.gov.in
10
2.
Land for Industrial Purpose
Land is one of the most invaluable resources as far as state of Kerala is concerned. The
state with its dense population, is finding it difficult to satisfy the land needs of even the
most deserving categories and development initiatives.
2.1 Non-Agricultural Land
2.1.1 Kerala has a diverse land use and cropping pattern. The land reforms introduced in
the State brought in radical and comprehensive institutional changes leading to drastic
transformation in the land holding pattern and a shift in the land use pattern.
2.1.2 Agriculture is still the dominant land use type accounting for over 55% of the
geographical area followed by forest land (including degraded forest) of 28%, with only
11% under non-agricultural use. Land under non-agricultural use was 9 percent in 199900 and has increased to 9.68 per cent in 2008-09 and it slightly declined to 9.31 percent
in 2009-10. The area under cultivable waste increased by 1821 hectares, while barren and
uncultivated land declined by 7019 ha. Table 2.1 shows the land use pattern in Kerala.
2.1: Land Use Pattern in Kerala
Classification of Land
2009-10
2008-09
Hectares Percentage Hectares Percentage

Total Geographical Area
3886287 100
Forest Cover
1081509 28
Land for Non-Agricultures Uses
361695
9
Barren and Uncultivated Land
17912
0.50
Permanent Pastures and Grazing Land 96
Land under Miscellaneous Tree Crops 4423
0.10
Cultivable Land
98014
3
Fallow other than current fallow
45374
1
Current Fallow
76945
2
Net Area Sown
2180679 56
Area Sown more than once
488026
13
Total Cropped Area
2668705 69
Source: Directorate of Economics & Statistics, Govt. of Kerala
3886287
1081509
376155
24931
229
6602
96193
45955
67759
2088955
605988
2694943
100
28
10
1
0
0
2
1
2
54
16
69
11
2.2 Waste Land

2.2.1
As per the data available with Department of Land Resource, the total waste land
available in Kerala is 2458.7 hectares.
2.2.2
Table 2.2 shows the district wise waste land in the state.
2.2: District-wise Waste Land in Kerala

District
Waste Land (Hectares)
Alappuzha
1.32
Kannur
201.24
Ernakulam
103.95
Idukki
449.57
Kasaragod
322.54
Kollam
45.77
Kottayam
120.5
Kozhikode
92.76
Malappuram
203.16
Palghat
457.86
Panthanamthitta
111.36
Thiruvananthapuram
182.99
Thrissur
80.72
Wayanad
84.96
Source: Department of Land Resources, Ministry of Rural Development, GoI
2.3 Industrial Land Bank

2.3.1 Availability of developed Industrial area
2.3.1.1 A major challenge for industrial development in the State is the non-availability
of adequate land. The State Government is in the process of acquiring land at strategic
locations of the state for orderly development of industries. Such lands will be kept as
land bank for future industrial and infrastructure requirements.
2.3.1.2 In its Industrial Policy 2007, the Government has encouraged recognizing leasing
of land for industrial and commercial purpose as equity participation by the landowners.
A Fast Track Mechanism is also being devised for transparency in land acquisition and its
12
utilization for the development of infrastructure through Public Private Partnerships, and
to address the address the concerns of the landowners through a time-bound
implementation of attractive rehabilitation schemes.
2.3.1.3 To avoid the situation of non-availability of land for future expansion /

implementation of latter phases of project, the developer will be allowed a call option
on buying adjacent land in future by remitting an annual premium to the Government for
a fixed period. The appropriate market value of the land will be provided to the
landowner.
2.3.1.4 The Government is also making provisions for the conversion of Industrial land
/plots into Industrial Parks / Commercial Estates, in cases where the established industry
remained in production for at least 5 years. Any industry, which commenced production,
but has been closed due to Court Order / Government Order / declared sick by BIFR, will
also be considered for conversion, in relaxation of the condition of being in production
for 5 years.
2.3.1.5 Existing DA, DP, IE, Growth Centers etc. are being modernized, expanded and
upgraded to meet the requirements of the industry. Any unused land / unused
infrastructure facility already allotted will be resumed and reallocated for starting new
units. Distribution of Pattayam for DA / DP plots will be done on a fast track basis.
SIDCO plots will be allotted expeditiously. Industrial plots will not be utilized for non
industrial purposes and speculation of land will not be allowed. Annexure 2 provides the
details on the land available in the Industrial Estates being developed by the Directorate
of Industries.
2.3.1.6 Kerala Industrial Infrastructure Corporation (KINFRA) is another agency

responsible for the development of industrial land. Table 2.3 gives details on the land
available in KINFRA Industrial Parks. KINFRA is currently developing the following
new parks,
Kera Park Thrissur
13
KINFRA Spices Park Idukki

KINFRA Rubber Park Panthanamthitta
Visit: www.kinfra.org
2.3: Industrial Parks of Kerala Industrial Infrastructure Corporation (KINFRA)
District
Thiruvananthapuram
Name of Industrial Park

KINFRA International Apparel Park
Available Land (Acres)

5.05
Panthanamthitta
KINFRA
Park,
Adoor
Food Processing / General
KINFRA Park, Kunnamthanam Land
Built up space
KINFRA Park, Mazhuvannur Food Zone
28.10
Panthanamthitta
Ernakulam
Malappuram
2.00
8500 sq.ft
2.80
Palakkad
KINFRA Food Processing Park, Kakkancherry

Special Economic Zone
KINFRA Industrial & Textile Park, Kanjikode
15.00
90.00
Wayanad
KINFRA Park, Kalpetta (Undeveloped land)
12.00
Kannur
KINFRA Park, Thalaserry
3.75
Kannur
KINFRA Textile Centre, Nadukani
57.85
Kasaragod
KINFRA Park, Seethangoli
1.00
Source: Kerala Industrial Infrastructure Corporation

2.3.1.7 Kerala Small Industries Development Corporation (SIDCO) is the agency
responsible for developing industrial estates for Micro & Small Enterprises. At present
there are 19 Development Area/Plot, 17 Major Industrial Estates, 3 Functional Estates
and 111 Mini Industrial Estates in the Co-operative and SIDCO series in the State.
Annexure III provides the details on land availability in Mini Industrial Estates. Table 2.4
gives district wise available land in Major Industrial Estates of Kerala SIDCO.
2.4: Major Industrial Estates District Wise
District
Industrial
Estate
Total
Land
Available
Land
District
Industrial
Estate
Total
Land
Available
Land
Alappuzha
Kollakadavu
19.15315
50 cents
Kottayam
Ettumanoor
30.31
55 cents
Alappuzha
Cherthala
8.94
20 cents
Kozhikode
West Hill
12.44
Nil
Ernakulam
Palluruthy
1.86
Nil
Malappuram
Manjeri
4.99
Nil
Ernakulam
Mudickal
4.6215
Nil
Palakkad
Karakkad
10.96
4 cents
Kannur
Palayad
8.42
Nil
Palakkad
Olavakkode
21.93
2.98 acre
Kasaragod
Kasaragod
16.84
26.0343
Pappanam
code
Kallettum
Nil
Umayanalloor
Thiruvanan
thapuram
Thrissur
18.5327
Kollam
39.81
cents
15
cents
Nil
Kollam
Karunaga
ppally
Changana
cherry
8.63
35 cents
Thrissur
Ollur
29.5625
Nil
14.22
Nil
Kottayam
Source: Kerala Small Industries Development Corporation (KSIDCO)
14
Visit: www.keralasidco.com
2.3.1.8 Kerala SIDCO has established an Industrial Park in every constituency in charge a
separate Industrial Parks division. Table 2.5 provides details on the land available in the
industrial parks.
2.5: Kerala SIDCO Industrial Parks in Kerala District Wise
Name of Project
Total Area
Allocable Area (Acres)
(Acres)
Area
Allotted
Available
(Acres)
(Acres)
Athani
11.81
7.07
6.94
0.13
Chelakkara
5.0251
4.2
Fully Allotted
Angamali
15.39
13.47
12.2067
1.2633
Moodadi
3.7778
3.0373
Fully Allotted
Shoranur
5.0104
3.8793
Fully Allotted
Thiruvarpu
1.34
1.0295
Fully Allotted
Kunnamthanam
1.5(3.5 Acres handed Under

over to CWC)
Area
1.5
Progress
Source: Kerala Small Industries Development Corporation (KSIDCO)
2.3.1.9 The major hurdle which comes in the way of the industrial development in the
state has been the inadequate infrastructure facilities. The Government intends to give
topmost priority to develop world-class infrastructure facilities to attract massive
investments in manufacturing and service sectors. The Government has evolved special
schemes to build up such facilities to convert the State into an investment friendly
destination. The initiatives include:
1. A proposed infrastructure company, Infrastructures Kerala Limited (INKEL), to
facilitate accelerated development of industrial infrastructure to attract massive
investment.
2. Develop major industrial water supply projects, power supply projects, sewerage
and effluent treatment plants etc., in industrial areas.
3. Ensure uninterrupted supply of quality power for industrial and commercial
purpose.
15
3.
Basic Infrastructure
3.1 Power
3.1.1
Kerala is one among the few Indian states which have the lowest rates for
electricity for both domestic and commercial outfits. Kerala State Electricity Board is the
sole distributor of the electricity for the state of Kerala except for Thrissur Corporation
and Munnar where the distribution is managed by City Corporation and Tata Tea Ltd
respectively. There is a huge shortage of power from last few years and the State
Government is facing difficulties in providing sufficient power to the industries. Table
3.1 listes the current generation capacity in the state.
3.1: Total Generation Capacity in Kerala
Sr. No. Source
Generation Capacity (MW)
1
Hydro
1780 MW
2
Thermal
430 MW
3
Nuclear
0
4
New & Renewable
140 MW
Total
2350 MW
Source: Energy Statistics 2011, MOSPI, Govt. of India
3.2 Water Supply
3.2.1
Kerala has many important rivers that flow from north to south; Valapattanam
river (110 kms.), Chaliar (69 kms.), Kadalundipuzha (130 kms.), Bharathapuzha (209
kms.), Chalakudy river (130 kms.), Periyar (244 kms), Pamba (176 kms), Achancoil (128
kms.) and Kalladayar (121 kms.). Other than these, there are 35 more small rivers and
rivulets flowing down from the Ghats.
3.2.2
The average per capita supply of water in major cities is 150 to 200 liters per
capita day. There are 1,745 rural water supply schemes and 69 urban water supply
schemes. To ensure uninterrupted supply of industrial water, the State Government has
proposed to develop major water supply projects in industrial areas. The current tariffs
for industrial use of water is Rs25/- per 1000 liters with a minimum charge of Rs. 250/-.
16
3.3 Roads
3.3.1
Roads are one of the basic modes of transportation system and also an important
priority sector of infrastructure. Systematic development of road is one of the important

pre-requisites for development and acceleration of growth in the economy. Among the
different modes of domestic transport systems, road transport carries more than 80
percent of the goods and passenger traffic. The network of roads, particularly from rural
to urban facilitates speedy movement of goods and services and ensures higher growth
trends, social integrity and well-being of the society. The productivity and efficiency of
road transport is directly linked with the availability and quality of road network.
3.3.2
Kerala has the highest road density among other Indian states and a well-
developed transport system operated by both public and private sector, thus enabling a
seamless movement of people and goods across the state.
3.3.3
Road density in the State is 417 Km/100 Sq.Km, which is far ahead of national
average of 100.39 Km/100 Sq.Km. The length of road per lakh population is 509.23 Km,
which is also much higher than the national average of 321.3 Km.
Figure 3.1 Road Network of Kerala
17
4.
Profile of Logistics
4.1 Geographical Proximity to Ports

4.1.1
The State with a coastline of 590 kilometers has one Major port, 3 Intermediate
ports and 14 Minor Ports. Besides the Port of Kochi (a Major Port governed by Major
Port Trusts Act, 1963), there are 3 Intermediate and 14 Minor Ports in Kerala. Table 4.1
list all the ports operating in the state.
4.1: Ports in Kerala
Type
Locations
Major Port
Kochi
of Form Alappuzha, Kozhikkode
Intermediate Ports Top
Neendakara,
Minor Ports
Vizhinjam, Valiyathura, Thankasserry, Kayamkulam, Manakkodam,

Munambam,
Ponnani,
Beypore,
Vadakara,
Thalasserry,
Manjeswaram, Neeleswaram, Kannur, Azhikkal and Kasaragod
Source: Govt. of Kerala
4.1.2
The Major Port of Kochi is under the Ministry of Shipping, Government of India
while the intermediate and minor ports are under the administration of the Government of
Kerala. Most of the minor and intermediate ports in the State are seasonal in nature and
are underdeveloped. The Kochi Port, with container handling facility, is one of the most
modern international seaports in the country. It spreads over 827 hectares and has a water
frontage of 7.5 Km. An International Container Transshipment Terminal is being
developed at Vallarpadam in Kochi, completion of which would make the Kochi port a
major hub port in the Indian Ocean region.
4.1.3
The State Government has plans to provide a boost to coastal shipping with the
development of ports to ease the burden on the heavily congested highways in the State.
They have allowed private investment in Intermediate and Minor Ports from
1994.Government has also decided to develop a Deep Water Container Transshipment
Terminal at Vizhinjam in Thiruvananthapuram through PPP mode. The Terminal when
completed would be able to cater to container vessels up to 8000 TEUs in the initial
phase and 10000 to 12000 TEUs sizes in the subsequent phases.
18
4.1.4
Canals link the lakes and backwaters to facilitate an uninterrupted inland water
navigation system from Thiruvananthapuram to Vadakara, a distance of 450 kms. The

Vembanadlake stretching from Alappuzha to Kochi is the biggest water body in the state
and is over 200 sq.kms. in area. Kuttanad in Alappuzha district alone has more than 20
per cent of India's total length of waterways. Waterways are successfully used for
commercial Inland Water Transport using locally-made crafts and passenger vessels. The
Inland waterways in Kerala including navigable portions of rivers area are about 1687
kms. The West Coast Canal also called National Waterway III stretching from Kovalam
in the South to Hosdurg in the North is being renovated for commercial transport.
4.2 Spread & Quality of Road Network
4.2.1
Kerala has the highest road density among other Indian states and a well-
developed transport system operated by both public and private sector, thus enabling a
seamless movement of people and goods across the state. Table 4.2 lists the length of
road network in the state.
4.2: Road Network in Kerala
Sr. No.
Type
1
National Highways
1542
2
State Highways
4655
3
Major District Roads
17117
Total
23314
Source: PWD, Govt. of Kerala
4.2.2
Length (Kms)
The State Government has established Roads and Development Corporation of
Kerala Ltd (RBDCK) on 23rd September 1999 for building and strengthening
infrastructure facilities for the overall development of the state. RBDCK is intended to
give a thrust for multifaceted growth in transport infrastructure by generating additional
resources through institutional finance, market borrowing and private participation.
4.2.3
The Kerala Road Fund Board has been set up by the Kerala State Public Works
Department to bring in greater private sector participation into developmental activities

like:
19
Promoting Public Private Sector participation in Infrastructural projects
Funding Feasibility Studies for Innovative Road Projects
Constructing new roads wherever necessary
Implementing Road Safety Projects as are found essential for safe and smooth
movement of traffic
Funding Research related to maintenance and development of roads
Developing existing road network systems including upgrading roads maintained

by the PWD
Implementing futuristic projects like Rapid Transit Systems and Metro Rail
Projects in Cities
4.3 Spread & Quality of Rail Network

4.3.1
The Indian Railways has spread its impressive network in Kerala connecting the
state with all the major cities of the country. A number of long distance trains operate
from Kerala to these locations on a daily basis. The Railway division at
Thiruvananthapuram, Palakkad and Madurai (Tamil Nadu) jointly carry out transport
operations in Kerala. The railway network extends over 1148 route Kms in Kerala of
which 111.14 km are meter gauge. The total route length of Railways in
Thiruvananthapuram Division is 625.80 km.
20
Figure 4.1: Railway Network in Kerala
4.4 Spread & Quality of Air Network

4.4.1
The state has three International Airports at Thiruvananthapuram, Kozhikode and
Kochi, of which the first two are owned by Govt. of India. The Cochin International
Airport is the first Greenfield airport in India setup on Public Private Partnership model.
21
Figure 4.2: Airports in Kerala
Together, they have handled 45,715 international flights, carrying 4.9 million passengers
and 36,598 domestic flights carrying 1.9 million passengers in 2008-09.
4.4.2
Besides expansion of the existing airports, two more airports are about to come up
in the State, one at Kannur district and the other at Aranmula in Panthanamthitta district.
These airports will not only cater to the large overseas community of Keralites, but also
help the tourism sector of Kerala with more connectivity and easy flying across the state.
22
4.5 Quality of Communication

4.5.1
Kerala has a tele-density of 80 per cent as compared to an all-India average of
52.7 per cent as of March 2010. The state has 1,242 automatic telephonic exchanges, of
which about 98% have Internet connectivity through the national Internet backbone.
According to estimates by the Telecom Regulatory Authority of India, Kerala had nearly
24.2 million wireless subscribers and 3.5 million wire-line subscribers as of March 2010.
Table 4.3 gives a snapshot of the communications in the state.
Visit: www.scribd.com/doc/54987552/kerala-190111
4.3: Communications Snapshot of Kerala
GSM cellular subscribers: 18,873,340
Internet/broadband subscribers: 1,059,800
Wireless subscribers: 24,194,621
Wire-line subscribers: 3,460,358
Post offices: 5,070
Telephone exchanges: 1,242
4.5.2
The state also has the highest penetration of optic fiber cable network in the
country and VSNL has an international communication gateway at Kochi with two highspeed submarine cable landings (SEA-ME-WE-3 and SAFE) offering 15Gbps bandwidth.
23
5.
Trends of Industrial Production
The State has had an average Industrial growth rate of 10.56 at constant prices in the last
5 years. The contributions of manufacturing sector to GSDP at constant and current
prices are 9.26 per cent and 9.33 per cent respectively during 2009-10. Table 5.1 lists the
key industries in the state.
5.1: Key Industries in Kerala
Handlooms & Power-looms
Cashew
Rubber-based Industries
Beedi
Bamboo-based Industries
Mining
Coir-based Industries
Tourism
Khadi & Village Industries
Food Processing
Sericulture
Spices & Spice Extracts
Seafood & Marine Products
Table 5.2 gives the district wise distribution of operating factories from 2007 to 2009.
5.2: District-wise Distribution of Operating Factories
District
2007
2008
Thiruvananthapuram
988
989
Kollam
1827
1827
Panthanamthitta
2801
2823
Alappuzha
412
418
Kottayam
231
231
Idukki
1273
1273
Ernakulam
1508
1510
Thrissur
1039
1041
Palakkad
1948
1969
Malappuram
622
622
Wayanad
2063
2064
Kozhikode
2529
2547
Kannur
895
896
Kasaragod
118
118
2009
994
1820
2822
419
244
1274
1535
1036
1968
623
2065
2544
895
120
24
5.1 Nature of Industries

Micro, small and medium enterprises (MSMEs) sector contributes significantly to the
manufacturing output, employment and exports of the country. It is estimated that in
terms of value, the sector accounts for about 45 percent of the manufacturing output and
provide employment about 66 million persons in over 29 million units throughout the
country. In fact, it provides the maximum opportunities for both self-employment and
jobs next only to agriculture sector.
5.3: Industrial Clusters in Kerala
District
Industries
Kannur
Handlooms, Power-looms, Beedi
Allepey
Coir Products
Idukki
Agriculture & Forest Based
Thiruvananthapuram
Handlooms, IT
Thrissur
Power-looms, Handlooms, Textile, Timber, Tile, Canning
Palakkad
Power-looms, Sericulture
Kollam
Minerals & Mining
Kozhikode
Rubber
Wayanad
Minerals & Mining
Kasaragod
Minerals & Mining
Kottayam
Rubber, Food Products, Engineering
Ernakulam
IT
Source: Directorate of Industries, Govt. of Kerala
5.1.1 Food Processing
Food processing industry has been recognized as a priority sector in Kerala due to its
potential for future growth and possibility of generating substantial employment. Kerala
Industrial Infrastructure Development Corporation (KINFRA) has been playing a pro
active role for the promotion of food processing industry in the State. KINFRA has set up
a number of food-theme based parks in the State. Being a priority sector, KINFRA has
also set up industrial parks to suit the specific needs of the food processing sector.
KINFRA Food Processing Park at Kakkancherry, Special Economic Zone (Food
Processing) at Kakkanchery, Food Processing Zone in KINFRA Small Industries Park,
25
Mazhuvannur, KINFRA Food Processing Park at Adoor and Seafood Park India Private
Ltd at Aroor are the five Food Processing Industries parks already set up by KINFRA.
5.1.2 Handloom Industry

Handloom Industry is a major traditional industry of Kerala and this sector stands second
to the coir sector in providing employment to about 1.00 lakh persons. Handloom
industry in the State is mainly concentrated in Thiruvananthapuram and Kannur districts
and in some parts of Kozhikode, Palakkad, Thrissur, Ernakulam, Kollam and Kasaragod
districts.
The Handloom industry in Kerala is dominated by co-operative sector with 94% looms
and remaining 6% of handloom units owned by industrial entrepreneurs. The cooperative sector consists of both factory and cottage type societies. The largest number of
co-operative societies is in Thiruvananthapuram district, which accounts 53% of the total,
and the lowest in Wayanad and Panthanamthitta districts. The major products in
handloom sector of the State are dhothies, furnishing material, bed sheets, grey sarees and
lungi, which accounts for 67 percent of the total production in the industry. About 80.13
percent of the major handloom cloths are produced in the Southern region of the State
followed by the North (12 percent) and Central region (7.87 percent).
The overall production of handloom cloth by Handloom Industry of Kerala increased
from 20.20 million meters in 2008-09 to 23.95 million meters in 2009-10. The total value
of production also shows an increase from Rs. 146.38 crores in 2008-09 to Rs. 165.33
crores in 2009-10.
5.1.3 Coir Industry

Kerala accounts for 95 per cent of the total coir and coir products produced in India. The
coir industry provides employment to 383,000 workers. The Alappuzha district of Kerala
contributes around 90 per cent to the total coir produced in the state. The state has three
coir parks, two at Alappuzhaand one at Perumon, in Kollam. The Coir Co-operative
Marketing Federation (COIRFED) is the apex federation of around 819 coir cooperatives. USA is the largest importer of coir products from India, followed by the
European Union.
26
5.1.4 Power-loom
Power-loom industry employs about 0.1 million people and ranks second among the
traditional industries of the state in terms of providing employment. The industry is
concentrated in the districts of Palakkad, Kozhikode, Thrissur, Ernakulam, Kollam and
Kasaragod. Around 94 per cent of the total number of looms is under the cooperative
sector, the rest being under industrial entrepreneurs. At the end of March 2009, there
were 676 registered primary handloom weavers co-operative societies (PHWCS),
consisting of 150 factory-type societies and 526 cottage-type societies. The overall
production of cloth in the co-operative sector of Kerala was 20.2 million meters in 200809, valued at US$ 32 million.
5.1.5 Electronics
The self-contained Electronics Technology Park at Technopark, Thiruvananthapuram,
has been instrumental in attracting global electronics manufacturers. The state has an
advantage of the availability of skilled and semi-skilled workers for the electronics
industry. Major companies operating in this sector include Traco Cable Company
Limited, Transformers & Electricals Kerala Limited and Kerala State Electronics
Development Corporation Limited.
5.2 Quantum of Output
5.2.1 Table 5.4 shows time series data series showing growth in past five years in Kerala
from 2003-2004 till 2008-2009.The No. of Factories, Value of Output, Net Value Added
shows a uneven trend. There was decrease in no. of Factories in 2006-2007 over previous
years and shown a marginal increase from 2007-2008 till 2008-2009.The Value of Output
shows a increasing trend from 2003-2004 till 2005-2006.Thereafter it declined and shown
a increasing trend during 2008-2009.The Net Value Added was highest during 20072008.It showed a decline during 2008-2009. Similar time series data based on several
characteristics is depicted in Annexure 7. Annexure 6 lists the distribution of factories
employment in overall and manufacturing sector in Kerala.
27
5.4: Time-Series Data Showing Growth in Past 5 Years in Kerala

Year
Characteristics
No. of Factories Value of Output
Net Value Added
2003-04
5491
3183189
409114
2004-05
5493
3611959
406601
AGR
0
13
-1
2004-05
5493
3611959
406601
2005-06
5643
4326786
446784
AGR
3
20
10
2005-06
5643
4326786
446784
2006-07
5554
5057943
355895
AGR
-2
17
-20
2006-07
5554
5057943
355895
2007-08
5584
5556577
592824
AGR
1
10
67
2007-08
5584
5556577
592824
2008-09
5868
7090489
770511
AGR
5
28
30
ACGR%
1.3
17.4
13.5
* Annual Growth Rate * Annual Compounded Growth Rate
Source: Annual Survey of Industries, Ministry of Statistics, Planning & Implementation,
GoI., 2003-2008
5.2.2 Gross Capital Formation (GCF) Gross capital formation had witnessed a huge
growth between 2003-04 and 2004-05 followed by sluggish growth between 2004-05 and
2005-06. The GCF had declined by about 30% between 2005-06 and 2006-07, followed
by another huge growth of 105%. Between the years 2007-08 and 2008-09, it declined by
56%. Table 5.5 lists the gross capital formation for the period between 2003-04 and
2008-09.
28
5.5: Gross Capital Formation for the State of Kerala

Characteristics
Gross Capital Formation (Rs.)
2003-04
84491
2004-05
222346
AGR
163
2004-05
222346
2005-06
230537
AGR
4
2005-06
230537
2006-07
161708
AGR
-30
2006-07
161708
2007-08
330916
AGR
105
2007-08
330916
2008-09
146806
AGR
-56
ACGR%
12.00
* Annual Growth Rate * Annual Compounded Growth Rate
Source: Annual Survey of Industries, Ministry of Statistics, Planning & Implementation,
GoI., 2003-2008
5.3 Efficiency
5.3.1
Annexure 5 lists the ratio of key characteristics of efficiency of industry for
overall industry and in particular the manufacturing sector for India and Kerala. The fact
of the manufacturing sector not being a core sector of the State is evident in the ratio,
where the state is a lot lower on the characteristics.
5.4 Constraints
5.4.1 Availability of Land Due the high density of population, there is a shortage of
industrial space in the state. Most of the industrial parks and estates have already been
fully allotted and the State Government is in the process of acquiring new land for
development. Until then there could be no major expansion of the industry in the state.
29
5.4.2 Infrastructure The State is also facing the issues of inadequate and
underdevelopment infrastructure, particularly in Power and Logistics sectors. The State
Government has plans to develop rivers and backwaters to establish an Inland Waterways
System and ease the traffic on the road network.
5.4.3 Power Shortage The State is currently facing a huge shortage of power supply and
there have been constant power-cuts for industries. Due the lack of available land for
power projects and environmental concerns, there could be no new power projects be
established in the State.
5.4.4 Environmental Issues The State has a huge green cover and there have been issues
for developing factories which release pollutants. The current regulations also delays the
process of environmental permits for new units.
5.4.5 Greater Focus on Less Labor Intensive Jobs Over the years the service industry in
the state has developed immensely attracting manpower from the state. This has led to a
shortage of skilled manpower for labor intensive manufacturing jobs.
5.4.6 Raw Material Shortage Rubber-based Industries are prominent in the State and
currently there is a shortage of the raw material due to issues such as small landholding of
rubber plantations etc
30
6.
Profile of Existing Industries
6.1 SMEs
6.1.1 Micro, small and medium enterprises (MSMEs) sector contributes significantly to
the manufacturing output, employment and exports of the country. In Kerala, the State
Government has provided special support to MSMEs due to its high employment and
economic growth potential. This sector contributes greatly towards domestic needs,
export marketing and foreign exchange earnings by producing variety of products
ranging from traditional to high tech. Though the volume of production of MSME sector
is very large, the quality of production, diversification of products, energy consumption
and environmental effects has always been a concern.
6.1.2 As of March 2010, there were about 213740 SSI/MSME units registered in the
state. The total investment in the tune of Rs. 731212.13 lakhs, the total number of
employment generated is 831847 and value of goods and services produced is Rs.
1545949 lakh. Table 6.1 lists number of SME units operating in the state based on
industry type. Table 6.2 lists the key MSME Clusters operating in Kerala.
6.1: Number of SME Units Operating in Kerala (Mar, 2011)
Industry
No. of Units Industry
No. of Units
Type
Operating
Type
Operating
Wood Based
1057
Mobile Phone Repairing
97
Food Products
1619
Rexin Products
185
Readymade Garments
1553
Wax Candles
79
Cement Products
766
PVC Products
133
General Engineering
1821
Mineral Water
31
Software Development
504
Paper Products
175
Marine Products
26
Printing
324
Rubber Products
143
Miscellaneous
3235
Products/Services
Fiber Glass Products
30
Total
11778
31
6.2: MSME Clusters in Kerala

District
Location
Product
District
Alappuzha
Alappuzha
Coir & Coir Kollam
Ernakulam
Ernakulam
Rubber
Kottayam
Ernakulam
Ernakulam
PowerMalappuram
Ernakulam
Kochi
Sea Food Palakkad
Kannur
Kannur
PowerSource: MSME Institute, Thrissur
Location
Kollam
Kottayam
Malappuram
Palakkad
-
Product
Coir &
Rubber
PowerPower-
6.1.3 The Kerala Bureau of Industrial Promotion (K-BIP) is coordinating the Cluster
Development activities throughout the State in association with Directorate of Industries
and Commerce. It coordinates the implementation of setting up of Common Facility
Centers (CFCs) in clusters as per MSMEEDP scheme of Government of India. Table
below provides details on clusters that have been sanctioned under this scheme. Table 6.3
lists the sanctioned MSME clusters under the MSE-CDP Scheme in Kerala.
Visit: www.kerala.gov.in
6.3: Sanctioned MSME Clusters under MSE-CDP Scheme in Kerala (As on
30.6.2011)
Name of Cluster
Location
Total Investment
(Rs. Lakhs)
Rubber Cluster
Plastic Cluster
Plywood Manufacturers
Terra Tile Cluster
Furniture Cluster
Rice Millers Cluster
Wood Cluster
General Engineering Cluster
Changanacherry, Kottayam
Aluva, Ernakulam
Perumbavoor, Ernakulam
Thrissur
Ernakulam
Kalady, Ernakulam
Malappuram
Malappuram
266.54
490
417.23
499.3
496.58
713.4
238.9
315.01
Ethnic Food Processing Cluster
Pala, Kottayam
454.86
Printers Clusters
Ernakulam
Nature Fiber& Allied Products Vaikkom, Kottayam
Cluster
253
485
6.1.4 There were further proposals submitted by the State Government to Central
Government for developing the following clusters,
32
1. Wood Cluster at Chadayamangalam, Kollam

2. Wood Furniture Cluster at Kannur
3. Agriculture Implements Cluster at Shoranur, Palakkad
4. Offset Printers Cluster at Kannur
5. Toys Cluster at Kottayam
6. Garments Cluster at Kollam
6.2
Large Industries
6.2.1 There are 63 State Public Sector Units (SPSUs) under the Industries Department out
of which, 17 have remained closed for long periods. Five are welfare corporations and
four are developmental agencies. Thirty seven companies are directly engaged in
manufacturing activities. Table 6.4 gives a break up of SPSUs based on type of industry.
Figure 6.1: Industry-wise State Public Sector Units in Kerala

The PSUs have been showing a trend of growth, both in respect of turnover and profit,
compared to the performance during the preceding years. It is observed from the
performance of 37 PSUs, only 5 units are functioning in losses and it is mainly seen in
the co-operative sector.
33
7.
Raw Materials
7.1 Description
7.1.1 The State is endowed with a variety of mineral resources; however they are not
available in plentiful amounts. There are occurrences/deposits of minerals such as Heavy
Mineral Sands ( Ilmenite, Rutile, Zircon, Monazite, Sillimanite), Gold, Iron ore, Bauxite,
Graphite, China Clay, Fire Clay, Tile and Brick Clay, Silica Sand, Lignite, Limestone,
Limeshell, Dimension Stone (Granite), Gemstones, Magnesite, Steatite etc. Mining
activities are largely confined to few minerals such as Heavy Mineral Sands, China Clay
and to a lesser extent Limestone/Limeshell, Silica Sand and Granite. Heavy mineral sand
and China Clay contribute more than 90% of the total value of mineral production in the
State. Table 7.1 listed the mineral production in Kerala for 2009-10.
7.1.2 There are extensive deposits of white clay and commercially valuable deposits of
graphite, lignite (brown coal), limestone, and mica in Kerala. Iron ore has been found at
Calicut. Kerala's monazite, magnetite, sillimanite, and zircon deposits are largely
undeveloped. Apart from this the beach sand of Kerala is rich in radioactive elements.
Although it has been proved that there are deposits of gold at some places of Wayanad,
Kozhikode and Malappuram districts, mining is yet to start. Neendakara, Chavara and
Kayamkulam regions have ample deposits of illuminate, magnetite, zircon etc. Kerala
State Mineral Development Corporation and the Mining and Geology Department play
the lead role in mining and research. Annexure 4 lists the location and mineral reserves.
7.1: Mineral Production in Kerala (2009-10)
Mineral
Production (Tons)
Mineral
Production (Tons)
China Clay
947619.8
Quartz
1145
Ilmanite
162066.67
Graphite
820
Rutile
8226.71
GBS
9765296.19
Zircon
16002.89
GDS
1109.65
Sillimanite
7310.29
Laterite
1322706
Silica Sand
179758.6
Brick Clay
1201741.1
Limeshell/Sea shell
85395.36
Ordinary Sand
2679072.5
Lime stone
686549.04
River Sand
5248901.6
Bauxite/Laterite
110451.44
Source: Directorate of Mining & Geology
34
8.
Skill Profile of Manpower
A long tradition of literacy and quality education has been the core strength of Kerala.
According to the 2011 census, Keralas literacy rate is 93.91%; well ahead of the national
average. With several reputed universities and technical institutions like engineering
colleges, institutes for information technology and management, research institutions, etc,
Kerala has the densest cluster of Science & Technology personnel in the country. The
large pool of educated and skilled human resource has substantial exposure to the best
practices of global business requirements thereby providing the state with the right
platform for social and economic growth.
Concerted effort is being made by the State Government for skill upgradation of work
force to match the world standards. The Government has plans for the formulation of a
scheme for capacity development of human resources for the next 20 years involving
premier institutes in the domain. A task force is being created to identify the skill sets
required for modern industries, setting up of finishing schools to meet the requirements
on the basis of the recommendations of the task force and establishing Management
Institutes for Micro Enterprise Development.
A number of factors are converging to create skills imbalance in the economy changing
age of the workforce, larger generation of young workers and available resources,
changing nature of jobs from agrarian to manufacturing to servicing, need for
investments in training vis--vis growth requirements, and insufficient workforce
planning, to name a few.
8.1 Database of Training Institutions

8.1.1 The education system in Kerala is well established with infrastructure ranging from
primary schools to colleges of higher education. The state has allowed the setting up of a
number of private colleges, especially engineering colleges to supplement the
government colleges.
35
8.1.2 As of 2010 there are about 119 engineering colleges in the state with a total
sanctioned intake of 38009. Out of these engineering colleges, 105 (88.24%) are selffinancing colleges, 11 (9.24%) are government colleges and 3 (2.52%) are private aided
colleges. Kerala University has the largest number of engineering colleges affiliated to it.
During 2010, 35 self-financing engineering colleges are started in the state. Tables 8.1 list
the number of technical institutions in the state.
Institutions
Government
8.1: Technical Education Institutions in Kerala (2010)

Number Institutions
Engineering 9
Fine Arts Colleges
Number
3
Colleges
Private Aided Engineering 3
Government Technical High 39
College
Schools
Government
Polytechnic 36
Colleges
Government
Government
Commercial 17
Institutes
Women's 7
Tailoring and Garment Making 42
Polytechnic Colleges
Training Centers
Private Aided Polytechnic 6
Vocational Training Centers
Colleges
Source: Directorate of Technical Education
8.1.3 The Industrial Training Department is responsible for the functioning of Industrial
Training Institutes (ITIs) in the state. There are currently about 52 ITIs and a basic
training centre, with a total intake of 16503 students, of which 30% of the seats are
reserved for women candidates. Table 8.2 lists the district wise distribution of ITIs/ITCs
in the state.
Visit: www.det.kerala.gov.in/index.php
36
8.2: District Wise Distribution of ITIs/ITCs in Kerala

District
No of Affiliated ITIs/ITCs
Total
Government
Private
General
Women
SCDD
General
Women
SCDD
Thiruvananthapuram 62
51
Kollam
53
48
Panthanamthitta
35
33
Alappuzha
49
45
Kottayam
35
31
Idukki
10
Ernakulam
57
55
Thrissur
42
34
Palakkad
17
14
Malappuram
16
11
Kozhikode
27
23
Wayanad
Kannur
29
26
Kasaragod
Total
445
19
25
389
Source: Department of Industrial Training, Govt. of Kerala
8.2 Availability of Technically Qualified Persons

8.2.1 The number of professional and technical work seekers in 2009 was 1.65 lakhs.
This number slightly decreased to 1.61 lakhs in June 2010. The share of employment
seekers with professional and technical qualifications is given in the table below and it is
seen that more than 90 percent of the technical and professional employment seekers are
ITI and Diploma holders in engineering. Table 8.3 lists the percentage work seekers in
the state.
37
8.3: Percentage Share of Professional & Technical Work Seekers in Kerala

Educational Qualification
2007 (%)
2008 (%)
2009 (%)
2010 (%)
Medical Graduates
1.55
1.55
1.66
1.28
Engineering Graduates
5.1
5.54
6.51
4.74
Diploma Holders in Engineering
23.56
22.21
24.8
23.6
ITI Certified holders
68.93
69.84
66.23
69.89
Agricultural Graduates
0.47
0.455
0.4
0.25
Veterinary Graduates
0.39
0.402
0.41
0.23
Total
100
100
100
100
8.2.2 Analysis of the sector wise growth of employment in public and private
establishments in Kerala in March 2010 revealed that the highest employment is in the
community, social and personnel services 44.29%, followed by manufacturing 22.91%,
financing and business services 9.20%, Transport 8.32%, Agriculture 7.17%, Electricity,
Gas, Water, Sanitary services 2.63%, Construction 1.91% and the lowest employment is
in the mining and Quarrying 0.239%.
8.2.3 Engineering colleges in the state offer varied courses to suit the needs of the
growing industry. Annexure 8 and 9 provide details on course-wise student intake for
engineering and polytechnic colleges.
8.3 Labor Wage Rate
8.3.1
The State Labor Department has identified 83 categories of employment spanning
agriculture, manufacturing and service industries under the Minimum Wages Act, out of
which minimum wages are notified in 46 employments. Annexure 10 lists the minimum
wages for key manufacturing industries of the state.
38
8.4 Attitude of Labor Towards Professional Work Culture

8.4.1
During 2009-10, 2352 industrial disputes were registered in the State. At the end
of the year, there were 5122 cases along with the pending disputes of previous year which
is less than 14.1% of previous year. A total of 2357 disputes were settled during the year
under review. Due to strike and lockout 39347 workers were affected which led to loss of
839788 man days. Table 8.4 and 8.5 lists the number of strikes and lockouts in the state
and the lost man-days.
8.4: Labor Strikes Over the Year in Kerala
2006
2007
2008
2009
Items
2005
Pending
Arose
Total
Man-day lost
1
10
11
3250553
0
6
6
86977
1
2
3
86746
0
22
22
394198
4
18
22
177494
2010
(As
on
30.9.10)
3
8
11
135502

8.5: Company Lockouts over the Years in Kerala
2005
2006
2007
2008
2009
Items
Pending
Arose
Total
Man-day
lost
27
4
31
1855429
23
6
29
1811755
27
0
27
1505370
4
5
9
758144
8
13
21
506606
2010 (As
on
30.9.10)
10
9
19
649439
8.5 Status of Labor Related to Legislation

8.5.1
The prominent role of the Labor Department is to maintain industrial peace and
harmony in Kerala. Enforcement of labor laws and implementation of labor welfare

schemes are pre requisites for maintaining the harmonious relation and creating
39
conducive climate for sustained investment. Labor Department is responsible for the
enforcement of labor enactments, settlement of industrial disputes, administration of
various welfare measures, revising / fixing the minimum wages of employees,
implementation of social security and insurance schemes so as to safeguard the rights and
privileges of working class and thereby providing a labor friendly atmosphere in the
State. There are 30 labor enactments administered by the Department. 83 categories of
employment have been covered by the minimum wages Act, 1948 out of which minimum
wages are notified in 46 employments.
8.6 Labor Regulations
8.6.1
Kerala is a model state for labor welfare measures. About 28 Labor Welfare Fund
Boards are functioning in Kerala under different departments. The State Government is
of the view that healthy labor relation and good work culture are the pre requisites for the
growth and sustenance of the industry. They have proposed to spearhead a massive
campaign to highlight the healthy labor relations and to remove the unfounded
perceptions.
The management will have the right to choose and deploy employees. However, local
workforce shall be engaged to the extent possible.
Government will take initiative in promoting a new management culture through regular
interaction with the industrialists and trade unions.
A reconciliation forum will be set up involving Departments of Labor, Industries and
Commerce, ensuring participation of trade unions for the effective redressal of labor
issues. Arbitration mechanism shall be implemented if industrial disputes arise, for
speedy decisions.
Public Sector Advisory Board and Fast Track Labor Courts will be constituted for Policy
making and dispute settlement.
40
9.
Profile of Business Environment
9.1 Single Window System

9.1.1
Kerala is one of the first states in India to have legislation for statutory Single
Window Clearance. The Government of Kerala has introduced the Single Window
Clearance System from 1st June, 2000 for expediting the issue of various clearances for
new Industrial Projects. As per this system, a final clearance for all new projects, either
approval or rejection, is to be given within a specific period from the date of submission
of application; a statutory requirement under the Kerala State Single Window Clearance
Boards and Industrial Township Area Development Act 1999.
9.1.2
A State Level Board for aiding medium and large-scale industries has been
constituted in this regard, headed by the Chief Secretary, which shall issue clearances
within a timeframe of 45 days. Kerala State Industrial Development Corporation has been
designated as the Single Contact Point and the Convener of the State Board. The Board
has statutory powers to enforce its decisions.
9.1.3
In a similar manner, District Level Boards have been constituted for clearing
small scale industrial undertakings, with the District Collector as the Chairman and
General Manager, District Industries Centre as the Convener; the stipulated time frame
being 60 days.
9.1.4
Industrial Area Boards have also been set up in various industrial areas of the
state for the clearance of projects being set up in these areas. An officer not below the
rank of District Collector is the Chairman in each Board, with the Designated Authority
of the Industrial Area as Convener, to issue clearances within a period of 30 days
9.1.5
A composite application form has also been formulated, which the entrepreneur
needs to submit only at the designated contact points. With the introduction of the Single
Window Clearance System, setting up of Industrial projects in the State is expected to
41
become a hassle free operation. Table 9.1 shows the Single Window Clearance process
and Table 9.2 lists the number of applications cleared/disposed since inception.
9.1: Single Window Clearance Process in Kerala
9.2: No. of Applications Cleared/Disposed Since Inception

Single Window Clearance Board Green Channel Counter
Received
Disposed
Received
Disposed
Thiruvananthapuram 18
14
4
4
Kollam
220
210
1202
1199
Panthanamthitta
206
180
878
871
Alappuzha
80
76
1162
1162
Kottayam
150
147
3318
3318
Idukki
0
0
0
0
Ernakulam
243
218
756
745
Thrissur
91
86
2630
2599
Palakkad
195
186
5136
5133
Malappuram
108
104
739
734
Kozhikode
173
167
3558
3558
Wayanad
2
2
250
250
Kannur
218
210
8464
8456
Kasaragod
21
21
2393
2393
Total
1725
1621
30490
30422
District
42
9.2 Special Agencies to Facilitate Industrialization

9.2.1 Kerala State Industrial Development Corporation (KSIDC)
Kerala State Industrial Development Corporation Ltd. (KSIDC) is a wholly owned

company of Government of Kerala setup for the promotion and development of medium
and large scale units in the State. It acts as the nodal agency for foreign and domestic
investments in the state by providing comprehensive support for investors, besides
processing various incentive schemes and facilitating constant interaction between the
government and the industrial sector. The agency promoted more than 650 projects in the
State with an investment outlay of Rs.5155crores. Following are the key areas of focus
for the agency:
1. Identification of Investment Ideas
2. Translating ideas into concrete proposals
3. Feasibility Study, Project Evaluation
4. Financial Structuring, Loan Syndication
5. Assisting in Central and State Govt. Clearances
6. Development and Administration of Growth Centers
7. Industrial and Infrastructure development
On-Going Mega Projects

Life Sciences Park - KSIDC proposes to develop a Life Sciences Park at
Thiruvananthapuram. 260 acres of land in Veiloor Village have been identified for the
purpose and KSIDC is in the process of acquisition of this land for the project. The Life
Sciences Park, when functional, would be a geographic cluster of industry
(Biotechnology, Nanotechnology & Life Sciences), research institutions and sci-tech
academia. The Park would address the needs of the rapidly emerging life sciences
industry and is expected to attract investments, both domestic and foreign, in the related
areas.
Electronics Hub - KSIDC has initiated steps for setting up of an Electronic Hub at Kochi.
The proposed Electronic Hub would be developed in 330 acres of land, offering world
43
class facilities for manufacturing, contract manufacturing, R&D and fabrication units in
the electronics sector. The Hub would house companies in the semiconductor and
electronic components sector, including their manufacture, research & development,
design, etc. The land acquisition procedure has been initiated.
Petro-Chemical Complex - The market survey conducted by KSIDC by engaging M/s.
Industrial Development Service Pvt. Ltd. (IDS), New Delhi has established scope for
setting up a project for manufacturing Propylene Oxide utilizing Propylene available with
BPCL-Kochi Refinery. In this context, KSIDC has developed a proposal for setting up a
Propylene-based petrochemical complex at Kochi. The estimated investment for setting
up the above project is Rs.1000Crore. KSIDC has prepared a pre-feasibility report for the
project and is looking for technology tie-up.
Titanium Sponge Project - Govt. of Kerala proposes to set up a Titanium Complex in
Kollam District consisting of a Titanium Sponge Plant of 10000 tons per annum capacity,
Titanium metal and downstream products. The proposed plant will be located adjacent to
the Kerala Minerals and Metals Ltd. (KMML), Chavara, a Govt. owned company
producing Titanium products. An extent of about 300 acres of land has been identified for
the project. KSIDC has commissioned a consultant to conduct techno-economic
feasibility of the project.
LNG Terminal - As the State's Promotional Agency, KSIDC has been instrumental to
facilitate establishment of the LNG Terminal at Kochi. The Terminal is being
implemented by M/s. Petronet LNG Ltd, a joint venture of ONGC, GAIL, IOC and
BPCL. Capacity of the LNG Re-gasification Terminal in the 1st phase is 2.5 Million
TPA, which will be enhanced to 5 Million TPA in the 2nd phase. The location is inside
the Cochin Port SEZ at Puthuvypeen, Kochi. The project aims to supply Regasified LNG
(R-LNG) to various customers in sectors like power, fertilizer, and industrial sector and
for City Gas Distribution (CGD) in the Southern States of Kerala, Tamil Nadu and
Karnataka, with the pipeline infrastructure is in place. The project, which has an
estimated cost of Rs.3,600Crores in the 1st phase has 3 major components, viz., Storage
Tanks, Marine Facility and Re-gasification Facility. 2 Nos. of Storage Tanks with a total
capacity of 5 Million TPA are under construction.
44
GAIL Pipe Line Project - KSIDC has signed an MoU with M/s. GAIL India Ltd, a'
Navaratna' Central PSU to facilitate establishment of Gas pipeline in the State of Kerala.
GAIL proposes to lay Gas pipeline from the Kochi LNG Terminal to various bulk
consumers of Gas in Kerala, Tamil Nadu and Karnataka. GAIL is laying the pipeline in
the following routes, for supply of R-LNG from the Kochi Terminal.
1. Kochi-Koottanad-Bangalore-Mangalore Pipe line (KKBMPL) Project
2. Sub-Sea Gas pipeline from Kochi to NTPC, Kayamkulam
3. The project will be implemented in 2 phases. The 1st phase is expected to be
completed in 2012 and the 2nd phase in 2013. The total project cost is estimated
at Rs 3,700 Crores.
Gas Distribution Project - KSIDC has signed a JV Agreement with GAIL for promoting a
Joint Venture Company (JVC) to develop Gas Distribution Project in Kerala. The JVC
proposes to create the Supplementary Gas Infrastructure in the State. It also intends to
take up City Gas Distribution Projects in the State.
Industrial Corridor - The Kochi-Coimbatore, Kochi-Kasaragod Industrial Corridor is
designed to utilize the existing infrastructure and new projects like LNG Terminal, ICTT
Vallarpadam, LNG Pipelines and High Speed Rail Corridor. The vision of the project is
to create strong economic base with global competitive environment and state of art
infrastructure to activate local commerce, enhance foreign investment and attain
sustainable development. The project is conceived to be developed as a global
manufacturing and trading hub supported by world class infrastructure and green
technology. The goals of the project are to double the employment, industrial output and
exports within a period of 5 years. The RFP for consultancy and pre-feasibility study will
be issued immediately. The first phase of the project proposes to start the corridor with
5000 hectares of land in the Kochi-Coimbatore route. The project would be implemented
through an SPV which would coordinate project development, finance and
implementation.
Gas based Thermal Power Project - Govt of Kerala, vide Govt order GO (MS)
No.19/2009/ID dated 07..02..2009, have appointed KSIDC as nodal agency for
development of thermal power project at Cheemeni, Kasaragod and allocated 2000 acres
of land necessary for the project. Govt. has constituted a Steering Committee with Chief
45
Secretary as Chairman for taking decisions on the project. Vide GO dated 1.12.2010
Govt. of Kerala have accorded administrative sanction for setting up of Gas based
Thermal Power Plant at Cheemeni, Kasaragod with project configuration of 1100-1200
MW units. A Special Purpose Vehicle (SPV) with 50:50 equity participation by KSIDC
and KSEB is being formed shortly for development of the power project. KSIDC has
appointed consultants for carrying out DPR&EIA studies, and the DPR is available.
Government of Kerala will be providing land on lease and obtain clearances for the
project. Apart from these, the Govt. will also provide Viability Gap Funding Grant to the
extent of Rs.500crores covering a period of 5 years. The project would be developed
through a developer selected through tariff based competitive case -2 bidding guidelines
of Govt of India. The process for selection of developers will be initiated shortly.
KSIDC has developed four Industrial Growth Centers (IGC) in the State, located at
Kannur, Kozhikode, Malappuram and Alappuzha districts. The Industrial Growth Centers
are aimed at the development of industrially backward districts of the State. The
Industrial Growth Centers are under various stages of development and thrust is given for
improving essential infrastructure facilities, in order to attract entrepreneurs.
All IGCs are provided with basic infrastructure facilities required for industries like
Roads, Telecommunication, Water Supply, Power, Administrative Buildings, etc. Land is
allotted to prospective entrepreneurs in the form of industrial plots and built up area.
Visit: www.ksiidc.com
9.2.2 Kerala Small Industries Development Corporation Ltd. (SIDCO)

KERALA SIDCO is a promotional agency set up as a Public Sector Undertaking by the
state government for providing assistance to SSI's such as providing infrastructure
facilities, distribution of essential raw materials, marketing of the SSI products,
undertaking civil and electrical works etc. The agency also acts as a nodal body for
supplying Bitumen to local Bodies as nodal agencies and Paraffin Wax to Small Scale
Industries. Currently the agency owns about 12 industrial lands in the state.
Major functions of the agency include offer factory sheds & developed land in all
districts of the state, provide industrial raw materials through district depots, marketing
assistance etc.
46
9.2.3 Kerala Industrial Infrastructure Corporation (KINFRA)

Kerala Industrial Infrastructure Development Corporation (KINFRA) aims at bringing
together all the suitable resources available in the state and developing infrastructure to
boost industrial growth in the state. It has 12 well-defined industrial parks of which many
are functional and some are in the launching phase. Each of these Parks offer
comprehensive infrastructure and support services to the clients. The most fascinating
feature of KINFRA is that it offers single window clearance facilities, along with
attractive incentives and excellent opportunities for expansion and diversification.
Visit: www.kinfra.org
9.2.4 Kerala Financial Corporation (KFC)

Kerala Financial Corporation was established by the State Government with the objective
of enabling rapid industrialization of the state by extending financial assistance to Micro,
Small and Medium Enterprises in manufacturing and service sectors.
Visit: www.kfc.org
9.2.5 Infrastructure Kerala Ltd. (INKEL)

Infrastructures Kerala Limited is a company promoted by Government of Kerala and
prominent global investors and industrialists for conceptualizing, developing and
operating projects across sectors including SEZs, industrial parks / estates and physical
infrastructure. It acts as a key-link between the State government and private sector, thus
maximizing investments by promoting and facilitating major infrastructure projects in the
State.
Visit: www.inkelkerala.com
9.2.6 Kerala Bureau of Industrial Promotion (K-BIP)

Kerala Bureau of Industrial Promotion (K-BIP) was established as an autonomous body
under the Industries Department for the promotion of potential business opportunities in
the state. It works in close co-ordination with other promotional agencies of the state for
the uplift of the industrial development giving specific attention to the strategic
47
advantages of the State. It acts as an interface between prospective entrepreneurs and

other State agencies. It also provides linkage between national and international agencies
for technology upgradation, technology development and technology management for the
various sectors. Major activities of the Bureau include:
1. Act as a single-point source for information to present and prospective
entrepreneurs
2. Identify prospective entrepreneur and motivate them in establishing industrial
units and other productive ventures
3. Support entrepreneurs in selection of product, technology, plant and machinery
and location
4. Consulting services for the preparation of Project Profiles, Market Survey Reports
and Project Reports
5. Organize training programmes and workshops
6. Co-ordinate the promotional activities of all institutions involved in the industrial
development of the State
7. Establish, maintain or manage offices, bureaus, counters, conference halls
anywhere in India required to further the cause of industrial development of
Kerala
Visit: www.keralaindustry.org
9.2.7
SWOT Analysis of Keralas Industrial Environment is presented in Table 9.2.
9.2: SWOT Analysis of Kerala Industrial Environment

STRENGHTS
Greater focus of the New State
Government on the development of
Industry
High Literacy Rate ensuring availability of
skilled manpower
Abundant natural resources such as
Rubber, Spices, Minerals etc
WEAKNESSES
Shortage of Industrial Land Majority of
Industrial Parks are already full
State facing acute power shortage leading
to industry inefficiency
Underdeveloped logistical infrastructure
connecting interior regions to ports
48
Cont
OPPORTUNITIES
Located close to a major Global Trade
Route
Potential for Electronics & Light
Engineering based industries
Potential for Food-Processing Industry due
to its proximity to Middle East
Availability of Inland-waterways which
can be developed for direct connectivity to
Ports
THREATS
Rampant increase in manufacturing
industry may to lead to destruction of
environment which is key for the State to
maintain is Tourism dominance
9.3 Cost of Starting a Business

Annexure XI provides detail on the Cost of Starting a Business for the State of Kerala. It
gives a detailed summary of the bureaucratic and legal hurdles an entrepreneur must
overcome in order to incorporate and register a new firm, along with their associated time
and set-up costs. It examines the procedures, time and cost involved in launching a
commercial or industrial firm with up to 50 employees and start-up capital of 10 times
the economy's per-capita gross national income (GNI).
49
10.
Incentives and Schemes
10.1 Packages offered to Entrepreneur / Industrialists

10.1.1 The State Government intends to capitalize the inherent strength of the State to
attract investments by providing incentives for investments in supporting facilities and
those equipments and systems. The proposed incentives under the Industrial Policy
include:
a. Subsidy upto 50% of the cost of capital equipments used in pollution control,
effluent treatment and other allied functions, subject to maximum of Rs.25 lakhs.
b. Special incentives package / facilities to large Investments with Rs.100 crores
and above to be considered on a case to case basis by the High Level Committee
chaired by the Chief Minister.
c. Incentives for all type of enterprises in line with the MSME Act of the
Government of India.
d. Price preference policy for Micro & Small Enterprises as stipulated in the Micro
Small & Medium Enterprises Development Act
e. Modify the existing Negative List with a view to extend the coverage of
incentives. The revised list of negative industries will be published.
10.1.2 Project Lending Scheme to Medium & Large Scale Industries

KSIDC offers financial assistance and support to medium and large scale industries in the
State including service sectors like tourism, star category hotels, resorts, hospitals,
infrastructure projects, etc and where the constitution of assisted unit is in the nature of
Private/ Public Ltd Company.
Usually assistance is extended to projects with an investment of Rs.200 Lakh and above
and our term loan assistance is limited to a maximum of Rs.2000 Lakh in a project and it
can go up further in a single project with State Government''s permission. The definition
of the medium and large scale manufacturing industries as defined by the Central
Government is applicable to Corporation also.
50
In addition to the above, the project should be financially and technically viable with
satisfactory financial indices like Internal Rate of Return (IRR), Debt Service Coverage
Ratio (DSCR), payback period etc, and the promoter directors should execute personal
guarantees with the Corporation for the timely repayment of the financial assistance
sought.
Visit: www.ksidc.org/projectlending.php
10.1: Project Lending Pre-requisites for KSIDC Financing
Debt
Equity (a) 1:1 up to 1.5:1 for new companies with minimum/no track record.
Ratio
(b) 1.5:1 upto 2:1 for companies in the thrust sectors/expansion of
good assisted units & other good non-assisted units.
Term Loans
Up to Rs.20Crore can be sanctioned. No cap for term loan under
direct financing. However loan exceeding Rs.20crore is subject to
approval
by State Govt. The minimum amount considered for assistance is
Rs.1 Crore except in case of expansion proposals of assisted units,
where the minimum limit would be Rs. 50 lakhs.
Short
Term May be considered for assisted units on a selective basis.
Loan
Repayment
Repayment period is 6-8 years with a moratorium of 2-3 years, on a
selective basis.
Interest Rate
Based on a sliding scale with interest band ranging from 10.50 12.50% for thrust sectors & 11.50 - 13.50% for others.
Source: KSIDC
10.1.3 Equipment Purchase Loan Scheme

KSIDC has an Equipment Purchase Loan Scheme, which is a scheme devised and
followed by IDBI for their existing good clients.
Under this scheme, loan will be given to purchase items of Plant & Machinery required
for improving the capacity utilization, production efficiency, etc, of an industrial
establishment, subject to certain terms and conditions as given below.
The Debt-Equity ratio is very liberal, as financing will be provided upto 77.5% of the
invoice value of the equipment. The balance 22.5% of the invoice value is the minimum
margin required to be invested by the Promoter. The security is exclusive. Payment
period of upto six years is allowed. The institution/ firm need to have continuous Net
Profit for the last 3 financial years. Accounts of the firm need to be maintained regularly.
There should not be any default to any financial institution/ bank.
51
11.
Conclusions and Core / Thrust Areas
11.1
Conclusions
The new State Government has envisaged a 100-day program towards the development
of the state by bringing in industry-friendly policies and establishing institutional
structures for industrial growth. Following key initiatives have to be quickly taken up for
increasing the competitiveness of the state.
11.1.1 Industrial Policy The State requires a new industrial policy since the previous
one was released in 2007. There should be a greater focus on providing incentives and
capital support to investors.
11.1.2 Creation of Land Banks One of the major constraints for any industrial project
is the availability of land. There is an immediate need for the creation of land banks for
industrial use.
11.1.3 Availability of Power The State has been facing huge power shortages for a
while and this will be a deterrent to prospective investors for setting up industries in the
state. The State has to evolve a policy to either improve power generation locally or allow
industries to purchase power directly from other states/private power companies.
11.2
Core / Thrust Areas
11.2.1 Food Processing

Because:
Food processing industry has been recognized as a priority sector in Kerala
Food Processing Parks,Zones and SEZs for food processing are amongst the several
industrial infrastructure that have been established
52
11.2.2 Coir
Because:
Kerala has 95 percent of the total coir produced in the country
Presence of suitable infrastructure to support the development of the coir industry in the
form of coir parks
Potential to export coir products-US and European Union are the biggest markets.
53
Annexure 1: Industry-wise Contribution to GSDP and Growth Rates

Industry of Origin
2009-10 at Current Prices Growth Rate (%)
1
Agriculture & Allied Activities
26424.2
11.47
2
Forestry & Logging
3509.75
1.52
3
Fishing
2704.55
1.17
4
Mining & Quarrying
2730.65
1.19
Subtotal of Primary Sector
35369.2
15.36
5
Manufacturing
21477.1
9.33
5.1 Registered
9464.67
4.11
5.2 Unregistered
12012.4
5.22
6
Electricity, Gas and Water Supply
3715.33
1.61
6.1 Electricity
3375.31
1.47
6.2 Gas
45.1
0.02
6.3 Water Supply
294.92
0.13
7
Construction
28111.2
12.21
Subtotal of Secondary Sector
53303.6
23.14
8
Transport, Storage & Communications 21660.1
9.4
8.1 Railways
742.77
0.32
8.2 Transport by other means
16428.6
7.13
8.3 Communications
4379.03
1.9
8.4 Storage
109.61
0.05
9
Trade, Hotel & Restaurants
48685.1
21.14
10 Banking & Insurance
11991.6
5.21
11 Real Estate Ownership, Business, Legal 27306.4
11.86
12 Public Administration
9557.02
4.15
13 Other Services
22442.6
9.74
Subtotal of Tertiary Sector
141643
61.5
54
Annexure 2: Industrial Land with Directorate of Industries

District
Name of DA/DP
Total
Allotted
Available
Area
Area
Area
Thiruvananthapura DA Vcli
108.63
88.28
20 Cents
m
DP Manvila
27.53
22.69
Kollam
DP Mundakkal
20.667
18.088
Panthanamthitta
DP Kunnathanam
20.94
15.37
0.41 Acres
Alappuzha
DA Kollakadavu
16.22
15.47
DP Chengannur
5.51
4.28
DA Punnapra
57.28
53
Coir Park 1 Cherthala 23.4
21.2
Coir Park 2 Cherthala 17.06
16.54
CIE Aroor
15.8
12.33
DA Aroor
47.17
41.78
Kottayam
Poovanthuruthu
41.25
37.32
Athirampuzha
1
0.86
Vaikom
3.75
3.25
Idukki
DP Muttam
5
4.58
Ernakulam
DA Aluva
57.82
54.91
DA Edayar
435.22
376.71
3.91 Acres
DA Angamaly
219.52
214.52
2.10 Acres
DA Vazhakulam
15.26
12.16
DP Angamaly
31.91
26.62
25 Cents
DP Kalamassery
78.12
64.74
7 Cents
Thrissur
Athani
48.286
43.286
.20 Acres
Kunnamkulam
3.0035
2.1
.10 Acres
Ayyankunnu
29.32
21.6
.60 Acres
Velakode
24.066
21.866
1.1
Kozhikode
DP West Hill
12.63
10.33
Palakkad
Pudussery
134.15
129.99
0.22 Acres
Janjikode-NIDA
532.8
513.44
0.69 Acres
DP Kappur
18.26
16.71
2.44 Acres
DP Shornur
17.72
17.12
10.62 Acres
Kanjikode (W)
143.14
Malappuram
FIE Manjeri
16.19
6.79
Kannur
DP Andoor
59.31
46.61
Kasaragod
DA/DP
212.5
203.58
152.79
Ananthapuram
Chathanchal
28.5
24.48
1.86
55
Annexure 3: Mini Industrial Estates in Kerala: District Wise

District
Industrial Estate
Total Area Vacant Land
Alappuzha
Kadakarapally
1 Acre
Nil
Alappuzha
Mararikulam
1 Acre
Nil
Ernakulam
South Vazhakulam
1 Acre
Nil
Ernakulam
Rayamangalam
1 Acre
Nil
Ernakulam
Piravam
1 Acre
Nil
Ernakulam
Kothamangalam
1 Acre
Nil
Ernakulam
Edathala
1 Acre
Nil
Idukki
Olamattom
1 Acre
Nil
Idukki
Kodikulam
1 Acre
41 Cents
Iddukki
Adimali
1 Acre
Nil
Kannur
Baliyapattom
1 Acre
Nil
Kannur
Thaliparamba
1 Acre
Nil
Kasaragod
Kanhangad
1 Acre
10 Cents
Kollam
Chithara
1 Acre
Nil
Kollam
Thrikkovilvattom
1 Acre
Nil
Kollam
Chadayamangalam
1 Acre
Nil
Kottayam
Nattakam
1 Acre
Nil
Kottayam
Ayarkunnam
1 Acre
Nil
Kottayam
Pampady
1 Acre
Nil
Kozhikode
Perambra
1 Acre
Nil
Kozhikode
Kadalundi
1 Acre
15 Cents
Malappuram
Edavanna
1 Acre
Nil
Malappuram
Oorakam
1 Acre
Nil
Malappuram
Kokkoor
1 Acre
Nil
Palakkad
Vaniyamkulam
1 Acre
Nil
Palakkad
Ottapalam
1 Acre
Nil
Palakkad
Pattambi
1 Acre
Nil
Panthanamthitta
Pandalam
1 Acre
Nil
Thiruvananthapuram
Ulloor
1 Acre
Nil
Thiruvananthapuram
Varkala
1 Acre
Nil
Thiruvananthapuram
Vellanad
1 Acre
20 Cents
Thiruvananthapuram
Anad
1 Acre
Nil
Thrissur
Arimpur
1 Acre
Nil
Thrissur
Kattur
1 Acre
Nil
Thrissur
Mala
1 Acre
Nil
Wayanad
SulthanBathery
1 Acre
Nil
Source: Kerala SIDCO
56
Mineral
Annexure 4: Mineral Resources & Availability in Kerala

Reserves
Region Available
(million tons)
Mineral Sands
Iron Ore
Bauxite
144
84
12.5
Neendaraka, Kayamkulam
Kozhikode, Malappuram,
Sooranad,
Vadakkumuri,
Chittavattom,
Adichanallur (Kollam District) Mangalapuram,
Chilambil,
Sasthavattom,
Attipra
(Thiruvananthapuram),
Thiruvananthapuram, Kollam, Kannur, Kasaragod
Kollam, Alappuzha, Ernakulam, Thrissur, Kannur
Coastal areas
Thrissur,
Kozhikode,
Ernakulam,
Kollam,
Thiruvananthapuram, Kannur and Palakkad
China Clay
Ball Clay
Fire Clay
Tile & Brick
Clays
172
5.67
11.5
-
Graphite
6.81
Silica Sand
Limestone
28.4
Alappuzha
24 Million Palakkad, Idukki
Crystalline
Limestone
Gemstones*
Granite
Thiruvananthapuram, Kollam, Kottayam, Idukki

and Ernakulam
Thiruvananthapuram and Kollam Districts

Thiruvananthapuram, Kollam, Panthanamthitta,
Kottayam, Palakkad, Kannur, Kasaragod, Wayanad,
Kozhikode,
Magnesite
0.037
Palakkad District
Steatite/Talc
7.94
Kannur District
*Chrysoberyl, Cat's eye, Alexandrite, Ruby, Sapphire, Beryl, Aquamarine, Topaz,
Kornerupine, Zircon, Sphene, Spinel, Garnet
57
Annexure 5: Ratio of the State on Key Characteristics of Overall and in

Manufacturing sector for India and Kerala
Overall Sectors Ratio
Manufacturing Sector Ratio
Characteristics
Structural
ratios ALL
SECTORS
Orissa
Fixed
Capital 203
per Factory (Rs.
Lakh)
Gross
Output 1209
per Factory (Rs.
Lakh)
Net
Value 131
Added
per
Factory
(Rs.
Lakh)
Workers
per 56
factory Number
Structural
ratios ALL
SECTORS
India
680
Structural ratios
only
for
Manufacturing
Sector Orissa
206
Structural ratios
only
for
Manufacturing
Sector India
672
2107
1223
2154
340
135
350
57
58
58
73
67
75
Net
Value 201938
Added
per
Employee
(Rupees)
Emoluments per 70569
Employee
(Rupees)
465916
202999
465554
114272
69811
115091
Wages
per 47612
Worker (Rupees)
68103
47000
68507
Employee
factory Number
65
Source: Annual survey of Industries, Volume 1, 2008-09, MoSPI, GoI
58
Annexure 6: Distribution of factories by employment in overall and manufacturing

sector in Kerala
Kerala
All India
Characteris
manufactur
all
% all
manufactur
all the
% all
tics
ing sector
manufactur
the
sector
ing sector
manufactur
sectors
sectors
No. of
322358
322358
33104
33104
8511704
8511704
877674
877674
workers
Total
367768
367768
3
38155
3
38155
10946303
10946303
5
113274
5
113274
persons
0 --- 14
2360
42.74
8
2454
8
41.82
53175
36.49
85
56379
85
36.3
15 -- 19
512
9.27
569
9.70
15359
10.54
16509
10.63
20 -- 29
463
8.38
493
8.40
17288
11.86
18683
12.03
30 -- 49
571
10.34
643
10.96
18720
12.85
20318
13.08
50 -- 99
571
10.34
617
10.51
17752
12.18
19145
12.33
100 -- 199
403
7.30
444
7.57
10677
7.33
11261
7.25
200 -- 499
263
4.76
269
4.58
7530
5.17
7765
500-999
128
2.32
128
2.18
2795
1.92
2824
1.82
1000-1999
127
2.30
127
2.16
1440
0.99
1442
0.93
2000-4999
95
1.72
95
1.62
716
0.49
721
0.46
5000&
29
0.53
29
0.49
274
0.19
274
0.18
Above
Total
5522
100.00
5868
100.0
145727
100
155321
100
0 MoSPI, GoI
Source: Annual survey of Industries, Volume 1, 2008-09,
59
Annexure 7: Estimate of selected characteristics of factory sector by 3-digit industry group (NIC-2008) for Kerala
Characteristics
Number of
Factories
(no.)
Fixed
Capital
Invested
Capital
Total
Output
Total
Inputs
Gross
Value
Added
Net
Value
Added
Income
Profit
Post Harvest Crop Activities (016)
75
87
61
70
-9
-22
-22
-34
Processing and preserving of fish,

crustaceans and molluscs and products
thereof (102)
114
19683
33402
146414
133782
12632
10426
1448
-2181
35
1536
2281
4074
4064
10
-110
-191
-662
35
9757
17763
92747
89569
3178
1705
514
-1144
Manufacture of dairy products (105)

Manufacture of grain mill products, starches
and starch products (106)
56
14217
16753
67461
59232
8229
6513
6070
2596
148
26334
48719
171540
164246
7294
4597
2425
573
Manufacture of other food products (107)
777
49856
143901
564121
469227
94894
90156
80749
31227
Manufacture of Prepared Animal Feeds

(108)
18
4632
7249
39339
30898
8441
7795
7234
5850
Manufacture of Beverages (110)
41
30023
38437
60199
52869
7330
4051
3184
-563
Manufacture of Tobacco Products (120)

Spinning, weaving and finishing of textiles
(131)
Manufacture of other textiles (139)
799
316
436
16801
6740
10061
10041
9970
860
162
94647
121294
60739
58373
2366
-6953
-14752
-25280
170
38496
55531
69936
70857
-921
-4230
-11984
-18617
Manufacture of wearing apparel, except fur

apparel (141)
24
15404
18321
26439
17176
9263
8291
6782
829
Manufacture of knitted and crocheted

apparel (143)
20
55
277
663
548
115
107
106
68
Processing and preserving of fruit and

vegetables (103)
Manufacture of vegetable and animal oils
and fats (104)
60
Tanning and dressing of leather;

manufacture of luggage, handbags, saddlery
and harness; dressing and dyeing of fur
(151)
394
1893
4694
3667
1027
977
822
402
Manufacture of Footwear (152)
85
7023
10422
35927
28497
7430
5890
5361
3633
Saw milling and planning of wood (161)
216
820
1558
8886
7199
1687
1594
1399
245
Manufacture of products of wood, cork,

straw and plaiting materials (162)
321
14120
23882
76683
65638
11045
9369
7356
1161
Manufacture of paper and paper products

(170)
116
28488
45868
86404
63863
22541
19860
18220
8332
Printing and service activates related to

printing (181)
117
8272
14502
40292
22138
18154
17351
15500
10430
Manufacture of refined petroleum products

(192)
21
310443
465349
2765979
2580966
185013
165929
163986
163986
Manufacture of basic chemicals, fertilizer

and nitrogen compounds, plastics and
synthetic rubber in primary forms (201)
70
90979
124502
341243
307660
33583
24980
19682
19682
Manufacture of other chemical products

(203)
118
24845
51792
128565
91904
36661
34154
31869
31869
Manufacture of pharmaceuticals, medicinal

chemical and botanical products (210)
124
23883
35173
50953
35913
15040
12379
9226
9226
Manufacture of rubber products (221)
280
55816
88039
538541
430441
108100
100962
96711
96711
Manufacture of plastics products (222)

Manufacture of glass and glass products
(231)
170
14037
21635
64768
50560
14208
12145
9626
9626
3551
4821
7096
6181
915
631
76
76
Manufacture of non-metallic mineral

products n.e.c. (239)
867
60401
76833
113463
79891
33572
28183
25473
25473
Manufacture of basic iron and steel (241)
241
59747
135339
583786
552660
31126
25978
19177
19177
61
Manufacture of basic precious and other

non-ferrous metals (242)
23
15073
23569
54068
46616
7452
6090
5125
1893
Casting of metals (243)
30
6389
12790
33837
31502
2335
1539
577
-1316
Manufacture of structural metal products,

tanks, reservoirs and steam generators (251)
51
633
1046
3467
2597
870
818
786
-223
Manufacture of other fabricated metal

products; metalworking service activities
(259)
91
3436
5352
14033
11645
2388
2023
1708
-543
Manufacture of electronic components
19
27566
44330
92535
66828
25707
23357
18570
9426
Manufacture of communication equipment
952
2385
6584
5033
1551
1476
1401
182
Manufacture of optical instruments and

equipment
405
3459
14811
9225
5656
5619
5542
4334
Manufacture of electric motors, generators,

transformers and electricity distribution and
control apparatus
29
1686
8757
41202
27475
13727
13467
13206
7312
Manufacture of batteries and accumulators
91
91
-9
-9
-9
62
Annexure 8: Engineering Colleges Intake in Kerala (2010-11)

Name of Course
Total Intake
Applied Electronics and Instrumentation
1380
Agricultural Engineering
46
Architecture
180
Automobile Engineering
300
Bio-medical Engineering
180
Bio- Technology
300
Civil Engineering
4472
Chemical Engineering
170
Computer Science and Engineering
7460
Diary Science and Technology
25
Electronics and Communication
9060
Electricals and Electronics
5460
Electronics and Instrumentation
300
Food Technology
60
Instrumentation and Control Engineering
120
Industrial Engineering
30
Information Technology
2715
Mechanical (Automobile)
60
Mechanical Engineering
5181
Mechanical (Production Engineering)
90
Polymer Engineering
60
Production Plant Engineering
150
Printing Technology
30
Aeronautical Engineering
180
Total
38009
63
Annexure 9: Trade Wise Intake in Polytechnics in Kerala (2010-11)

Name of Trade
Sanctioned Intake
Civil Engineering
1221
Mechanical Engineering
1584
Electrical and Electronics
1078
Electronics Engineering
2310
Chemical Engineering
121
Automobile Engineering
319
Textile Technology
198
Computer Science and Engineering
2035
Instrument Technology
198
Polymer Technology
198
Computer Hardware Maintenance
583
Tool and Die
132
Electronics Production Technology
132
Architecture
99
Electronics and Communication
462
Electronics and Instrumentation
390
Wood and Paper Technology
44
Printing Technology
77
Bio-Medical Engineering
66
Electronics and Aviation
55
Information Technology
66
Computer Application and Business Management
242
Commercial Practice
374
Total
11984
64
Annexure 10: Select Manufacturing Sector Wages Rates in Kerala

Scheduled Employment
Category of
Basic
V.D.A.
Workers
Minimum
Wages
Ayurvedic & Allopathic Medicines
Unskilled
96.23
68.06
Semi-skilled
100.54
68.06
Skilled
102.69
68.06
Highly skilled
107
68.06
Beedi and Cigar Industry
Grade (3)
80.96
57.08
Grade (2)
85.19
57.08
Grade (2)(A)
87.3
57.08
Grade (1)
93.65
57.08
Block Rubber Factories
Unskilled
135
68.06
Semi-skilled
150
68.06
Skilled
159
68.06
Brick Manufactures
Unskilled
85.2
157.7
Semi-skilled
87.6
157.7
Skilled
90
157.7
Cashew Industry
Lowest Rate
98.1
26.55
Highest Rate
115.1
26.55
Coir Manufacturing
Piece rate wages exists
Fish Peeling and Fish Canning,
Lowest Rate
132
43.46
Freezing and Exporting of Sea Foods. Highest Rate
230
43.46
Gold and Silver Ornaments
Handloom Industry
Hill Product Industry

Hosiery Manufacturing
Hosiery Manufacturing
Unskilled
Semi-skilled
Skilled
Unskilled
Semi-skilled
Skilled
Highly skilled
Lowest Rate
Highest Rate
Unskilled
Semi-skilled
Skilled
Highly skilled
175
225
250
118
124
131
137
128
130
65
68
106.62
164.3
51.66
51.66
51.66
51.66
51.66
51.66
51.66
68.06
68.06
94.28
94.28
94.28
94.28
Total
Wages
164.29
168.6
170.75
175.06
138.04
142.27
144.38
150.73
203.06
218.06
227.06
242.9
245.3
247.7
124.65
141.65
175.46
273.46
226.66
276.66
301.66
169.66
175.66
182.66
188.66
196.06
198.06
159.28
162.28
200.9
258.58
65
Ice Factory
Unskilled
Highly skilled
Khadi Industry categorized according Grade VII
to
turn over
Grade VI
Grade V
Grade IV
Grade III
Grade II
Grade I
Light Motor Vehicles
Lowest Rate
Highest Rate
Match Industry
Lowest Rate
Highest Rate
Minor Engineering
Unskilled
SemiskilledGr.2
SemiskilledGr.1
Skilled Gr.3
Skilled Gr.2
Skilled Gr.1
Highly skilled
Supervisory
Minor Ports
Lowest Rate
Highest Rate
Oil Mill
Unskilled
Semi-skilled
Skilled
Power loom Industry excluding the Unskilled
workers employed in power loom Semi-skilled
section of Cotton Textile Mills in the
Skilled
State
Highly skilled
Printing Press
Unskilled
Skilled C
Printing Press
Skilled B
Skilled A
72.96
75.31
115
81.26
81.26
51.66
154.22
156.57
166.66
134
144
153
163
173
192
148
174
59.3
66.7
138
150
51.66
51.66
51.66
51.66
51.66
51.66
68.06
68.06
71.47
71.47
68.06
68.06
185.66
195.66
204.66
214.66
224.66
243.66
216.06
242.06
130.77
138.17
206.06
218.06
145
68.06
213.06
164
158
154
166
192
75
139
123
126.8
127.85
71.8
73.38
78.16
78.16
137.55
151.3
166.4
183.1
68.06
68.06
68.06
68.06
68.06
209.03
209.03
68.06
68.06
68.06
80.11
80.11
80.11
80.11
54.32
54.32
54.32
54.32
232.06
226.06
222.06
234.06
260.06
284.03
348.03
191.06
194.86
195.91
151.91
153.49
158.27
158.27
191.87
205.62
220.72
237.42
66
Rice Mill, Flour Mill & Dhal Mill
Unskilled
167
45.05
Semi-skilled
174
45.05
Skilled
181
45.05
Rubber Crepe Mills
Unskilled
130
68.06
Semi-skilled
134
68.06
Skilled
139
68.06
Rubber Products Industry
Unskilled
85
88.11
Semi-skilled
92.5
88.11
Skilled
95
88.11
Highly skilled
96.25
88.11
Tile Industry
Unskilled
120.2
68.06
Semi-skilled
120.7
68.06
Skilled
121.8
68.06
Highly skilled
122.3
68.06
Timber Industry and Plywood Industry Unskilled
111
68.06
Semi-skilled
113
68.06
Skilled
115
68.06
Highly skilled
122
68.06
Manufacture and sale of Umbrellas
Guaranteed Minimum Wages - 125/Grade VII
155
43.42
Grade VI
165
43.42
Grade V
173
43.42
Grade IV
177
43.42
Grade III
185
43.42
Grade II
205
43.42
Grade I
231
43.42
Source: Department of Labor, Govt. of Kerala
212.05
219.05
226.05
198.06
202.06
207.06
173.11
180.61
183.11
184.36
188.26
188.76
189.86
190.36
179.06
181.06
183.06
190.06
198.42
208.42
216.42
220.42
228.42
248.42
274.42
67
Annexure 11: Cost of Doing Business in Kerala

STEP
Procedure
Time to
Complete
(in days)
Associated
Cost (in
INR)
Obtain director identification number (DIN) online from the Ministry of

Corporate Affairs portal (National)
100
Obtain digital signature certificate online from private agency authorized

by the Ministry of Corporate Affairs (National)
1500
Reserve the company name online with the Registrar of Companies

(ROC) (National)
500
Stamp the company documents at the State Treasury (State)
1,525
Make a seal (Private)
Obtain a Permanent Account Number (PAN) from an authorized

franchise or agent appointed by the National Securities Depository Ltd
(NSDL) or the Unit Trust of India (UTI) Investors Services Ltd, as
outsourced by the Income Tax Department (National)
15
67
Obtain a Tax Account Number (TAN) for income taxes deducted at the
source from an authorized franchise or agent appointed
14
57
Register with the Office of Inspector, Shops and Establishment Act

(State/ Municipal)
14
I500
Register for Value-Added Tax (VAT) at the Commercial Tax Office

(State)
25
1,800
10
Register for Profession Tax at the Profession Tax Office (State)
No Cost
11
Register with the Employees' Provident Fund Organization (National)
18
No Cost
12
Register for medical insurance at the regional office of the Employees

State Insurance Corporation (National) m
15
No Cost
30
68

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State Level Resources to Promote the Growth of Manufacturing in Kerala

State Level Actions

National Manufacturing Competitiveness Council

CENTRE FOR RESEARCH, PLANNING & ACTION

State Level Resources to Promote the Growth of Manufacturing in Kerala

Though all care has been taken as to authenticity of various data

State Level Resources to Promote the Growth of Manufacturing in Kerala

State Profile ................................................................................................................ 6

Land for Industrial Purpose ................................................................................... 11

Basic Infrastructure ................................................................................................ 16

Profile of Logistics ................................................................................................... 18

Trends of Industrial Production ............................................................................ 24

Profile of Existing Industries .................................................................................. 31

Raw Materials .......................................................................................................... 34

Skill Profile of Manpower ....................................................................................... 35

Profile of Business Environment ............................................................................ 41

10. Incentives and Schemes........................................................................................... 50

State Level Resources to Promote the Growth of Manufacturing in Kerala

State Level Resources to Promote the Growth of Manufacturing in Kerala

9.2 Special Agencies to Facilitate Industrialization ..................................................... 43

State Level Resources to Promote the Growth of Manufacturing in Kerala

For more information visit:

1.2 Location and Area

State Level Resources to Promote the Growth of Manufacturing in Kerala

Figure 1.1: Map of India Showing the Location of Kerala

State Level Resources to Promote the Growth of Manufacturing in Kerala

1.1: Administrative Units in Kerala

1.2: Districts of Kerala & Areas

1.4 Demographic Information

State Level Resources to Promote the Growth of Manufacturing in Kerala

1.3: Key Demographics of Kerala

Population Density (Per Sq.Kms)

Source: Census 2011

1.5 Economy of the State

State Level Resources to Promote the Growth of Manufacturing in Kerala

Figure 1.2: Sector Contribution to Kerala GSDP

Constant (2004-05) Prices

Source: Economic Review 2010

State Level Resources to Promote the Growth of Manufacturing in Kerala

Land for Industrial Purpose

Hectares Percentage Hectares Percentage

State Level Resources to Promote the Growth of Manufacturing in Kerala

2.2 Waste Land

available in Kerala is 2458.7 hectares.

2.2: District-wise Waste Land in Kerala

2.3 Industrial Land Bank

State Level Resources to Promote the Growth of Manufacturing in Kerala

2.3.1.3 To avoid the situation of non-availability of land for future expansion /

2.3.1.6 Kerala Industrial Infrastructure Corporation (KINFRA) is another agency

State Level Resources to Promote the Growth of Manufacturing in Kerala

KINFRA Spices Park Idukki

Name of Industrial Park

Available Land (Acres)

KINFRA Food Processing Park, Kakkancherry

KINFRA Park, Kalpetta (Undeveloped land)

KINFRA Park, Thalaserry

KINFRA Textile Centre, Nadukani

KINFRA Park, Seethangoli

Source: Kerala Industrial Infrastructure Corporation

Source: Kerala Small Industries Development Corporation (KSIDCO)

State Level Resources to Promote the Growth of Manufacturing in Kerala

Allocable Area (Acres)

1.5(3.5 Acres handed Under

Source: Kerala Small Industries Development Corporation (KSIDCO)