Maharashtra, from time immemorial, has been a commercial hub. Ancient records provide details of trade between towns such as Pratishthana (modern-day Paithan) and civilizations such as Rome and Greece. Its influence on global trade was so great that, according to legend, the Roman parliament once had to ban the import of high-quality Paithani textile to enforce austerity.
Centuries later, the region is reaffirming its importance as a lucrative investment destination. With a GSDP of around $370 billion in the 2020-21 fiscal and boasting of the highest GDP contribution by a state in India, Maharashtra had the highest FDI inflow in the country between 2000 and 2020. Between October 2019 and March 2021, the height of the pandemic, Maharashtra attracted Foreign Direct Investments (FDI) worth USD 23,432.35 million – more than one-fourth of India's overall FDI inflow.
Infrastructure and connectivity: The focus on boosting industrial growth
Part of the reason behind Maharashtra’s growing allure is the forward-looking reforms led by the state. Its dynamic government has developed liberal and investor-friendly policies that have driven investments to the state even during the pandemic. It has also placed greater emphasis on augmenting the infrastructure, connectivity, and production capabilities across the state. Road and bridge construction accounted for 5.2% of its annual budget – 0.9% higher than the corresponding national average.
Of this amount, INR 7,000 crore has been earmarked for the Nanded-Jalna Expressway Connector in the Marathwada region. The development will be a big boost to the industrial complex across the region by improving connectivity between the districts of Naded, Hingoli, Parbhani, and Jalna. The Mumbai-Pune Expressway, one of the country’s busiest roads, has also received INR 6,695 crore for the construction of bridges and underpasses to minimize traffic congestion and improve transportation efficiencies.
Furthermore, the state has given its nod to an INR 26,000 crore funding for the 170-kilometer-long Pune Ring Road. INR 9,573 crore has also been redirected to a 540-kilometer-long marine highway between Rewas (Raigarh) and Redi (Sindhudurg) to decongest the Mumbai-Goa highway.
Building skills, for the present and the future
Thanks to its position as a commercial, industrial, and financial hub, Maharashtra has access to a vast pool of skilled workers, from financial analysts to supply chain managers and IT professionals. The state has also worked to improve the employability of its skilled, semi-skilled, and unskilled workforce.
Initiatives such as Pramod Mahajan Kaushalya and Uddyojakta (PMKUVA), for instance, provide free skill-based training through Industrial Training Institutes (ITIs) and private vocational training organizations. Other initiatives, such as the Chief Minister’s Agriculture & Food Processing Scheme, have been improving the availability of skills and solutions in the agricultural and food processing sector through fiscal grants and skilling programs. Little wonder, then, that Maharashtra leads other states in providing vocational training and has the largest pool of employable professionals in the country.
Minimizing bureaucracy, maximizing growth
But infrastructure growth is just a small part of the changes currently underway in Maharashtra’s business landscape. The Government of Maharashtra has also been improving the ease of doing business in the state by reducing the bureaucratic red tape for enterprises.
Last year, among several incentives and proposals for businesses, it launched the Maha Parwana plan to provide a single-window clearance system to investments over INR 50 crore. Under its ‘Plug-&-Play Infrastructure’ scheme, the state has also fast-tracked the approval of investment proposals, apart from earmarking over 40,000 acres of landbank, enabling automatic clearances in 48 hours, flexible pricing and rentals, and specialized labor protection guidance.
The Maharashtra Industrial Development Corporation (MIDC), widely recognized as one of the most competent industrial promotion authorities in Southeast Asia, is also working to transform Maharashtra into a global manufacturing hub. Between June 2020 and June 2021, at the height of the economic disruption caused by COVID-19, it facilitated investment commitments north of INR 1.67 lakh crore under the Magnetic Maharashtra 2.0 initiative. Between October 2020 and March 2021, it also secured over a total of INR 2 lakh crore as part of domestic and foreign direct investments that is already being mobilized to improve state-wide production capabilities and manufacturing output.
Vision 2030: The Road Ahead
In its Vision 2030, the Government of Maharashtra aims to increase its per capita income to INR 6 lakh, up from roughly INR 2 lakh at present. It is also targeting CAGRs of 15% for its services sector, over 12% for its industry sector, and about 12% viz. its GSDP. The state aims to add 11,360 MW of electrical capacity by 2030, wherein 2,830 MW will be derived from solar energy, and is also working to improve connectivity between all districts and talukas. In less than a decade, it also aims to achieve at least a 40% share of India’s overall FDI inflows and simplifying procedures via multiple ease of doing business measures, with the aim to develop hassle-free government-investor relationships.
For discerning businesses, the combination of a vast and skilled talent pool, proactive policymaking, and growth-oriented outlook offers an unparalleled growth opportunity. Moving forward with the right vision, Maharashtra has emerged as the prime investment destination for national and global businesses. The state leadership is taking several steps and is committed to further strengthening its framework to create an investor-friendly environment. Through its focus on cultivating an infrastructure conducive to collective growth, Maharashtra has taken a step towards becoming the ‘State of Dreams’ for modern businesses.
