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POLICIES

Gujarat has everything it takes to be called India's No. 1 State'. Besides in the state there exists business friendly environment, investment opportunities and moreover the state is endowed with rich natural resources like mineral, energy, marine and agriculture products essentially needed for setting up industries. To tap the huge possibilities in the area of development, The Government of Gujarat has come up with user/ business friendly policies for various sectors. The deluge of inquiries as well as investment commitments by the private companies witnessed in the last three Vibrant Gujarat Investor's Summits. The Government of Gujarat has announced following major policies:

Power Policy

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CIVIL AVIATION POLICY(DRAFT)

Circulated for comments by :
Ministry of Civil Aviation
Government of India
April, 2000
MISSION
To maintain a competitive civil aviation environment which ensures safety and security in accordance with international standards, promotes efficient, cost-effective and orderly growth of air transport and contributes to social and economic development of the country.
STRATEGIC OBJECTIVES
The objectives of this policy are the creation and continued facilitation of a competitive and service-oriented civil aviation environment in which:
  1. the interests of the users of civil aviation are the guiding force behind all decisions, systems and arrangements,
  2. safe, efficient , reliable and widespread quality air transport services are provided at reasonable prices,
  3. there exists a well-defined regulatory framework catering to changing needs and circumstances,
  4. all players and stakeholders are assured of a level playing field;
  5. private participation is encouraged and opportunities created for investors to realize adequate returns on their investments;
  6. recognizing that aviation today is an important element of infrastructure, rapid upgradation of airport infrastructure to world class with priority to the busiest airports and those handling international flights;
  7. recognizing that transportation of air cargo is vital to the economic growth of the country, creation and development of specific infrastructure for air transportation of cargo and express cargo is encouraged,
  8. "airline operations and acquisition of aircraft" is conferred "infrastructure" status for overall growth of civil aviation sector in the country
  9. domestic and international aviation in the country are encouraged to grow at par with world aviation industry;
  10. inter-linkages with other modes of transport are encouraged and stimulated;
  11. trade, tourism and overall economic activity and growth is encouraged;
  12. international cooperation in aviation and development in tune with international trends and best practices, consistent with airspace sovereignty is promoted;
  13. indigenous development of aircraft, components and aviation products is encouraged,
  14. Security of civil aviation operations is ensured through appropriate systems, policies, and practices, and
  15. Effective systems are put in place for timely crisis and disaster management, including investigation of incidents/accidents.
CONSULTATION WITH USERS
  1. The success of any policy depends upon the benefits it gives to the various users. A constant interaction with and amongst all categories of users is paramount for successful implementation of and constant improvement in the policy. There is an urgent need for an institutional arrangement at different levels for such interaction.
  2. Therefore, Facilitation Committees consisting of representatives of various users of civil aviation sector i.e. government, passengers, tour and travel operators, aircraft-operators, airport-operators, exporters and importers, cargo handling agents, aerosports, Flying Clubs, etc. will be set up at national, regional and local levels to ensure that the interests of ultimate users are best safeguarded. There will be regular monitoring and feedback between the Facilitation Committees of national regional and local levels. There will be mandatory prior consultation with these Facilitation Committees before amendments in policy/ rules / regulations are undertaken.
  3. Highest priority will be accorded to the passengers/ users and suitable mechanisms will be set up for this purpose, including publication of Citizens' Charters and effective action for, and monitoring of, grievance redressal.
REGULATORY FRAMEWORK
  1. In the context of a multiplicity of airlines, airport operators (including private sector), and the possibility of oligopolistic practices, there is need for an autonomous regulatory authority which could work as a watchdog, as well as a facilitator for the sector, prescribe and enforce minimum standards for all agencies, settle disputes with regard to abuse of monopoly and ensure level playing field for all agencies. Therefore, a statutory autonomous Civil Aviation Authority (CAA) will be constituted. The basic objectives of setting up of the Authority will be to ensure aviation safety, security and effective regulation of air transport in the country in the liberalised environment.
  2. The functions of the CAA will be as under:
    • set the standards for various agencies and personnel of civil aviation sector;
    • issue license to these agencies and personnel;
    • regulate tariff;
    • ensure that these agencies and personnel continuously fulfil the standards;
    • take appropriate preventive/corrective/punitive action against the agencies and personnel for violations of set standards;
    • ensure that there are no unfair trade practices and market dominance through encouragement of entry and fostering of competition in accordance with Competition Policy of the Government;
    • ensure level playing field for all agencies and
    • study and analyse the trends in international and domestic civil aviation, project likely future scenario and publish periodical reports.
    • The agencies mentioned above include airport, airport-operators, passenger aircraft operators, cargo aircraft operators, helicopters, private aircraft operators, flying clubs, aero-sports clubs, security agency, training institute, air-travel operators or any other agency having role in civil aviation sector
    • The personnel mentioned above include pilots, flight engineers, navigators, cabin crew, flight despatchers, aircraft maintenance engineers/ technicians, air traffic controllers and personnel engaged in the maintenance of communication, navigation, surveillance/ air traffic management systems and other ground aids.
  3. Civil Aviation Authority will conduct safety and security audit including flight inspections of the concerned agencies to ensure that they are meeting the prescribed standards.
  4. Civil Aviation Authority will be required to publish Annual Report on the Air Safety and Security Environment in the country.
  5. Civil Aviation Authority will also be required to make available information regarding passenger and cargo traffic including regular analysis in an appropriate consolidated format on a commercial basis.
  6. A comprehensive Indian Aviation Law will be framed to replace the existing Acts relating to aviation and security which will be in tune with the present day civil aviation scenario, and would also put the proposed CAA in place.
PRIVATE SECTOR PARTICIPATION
  1. Private sector participation will be a major thrust area in the civil aviation sector for promoting investment, improving quality and efficiency and increasing competition.
  2. Competitive regulatory framework with minimal controls will be created to encourage entry and operation of private airlines/ airports.
  3. Private sector investment in the construction/ upgradations/ operation of new as well as existing airports including cargo related infrastructure will be encouraged.
  4. Rationalization of various charges and price of ATF/AVGas will be undertaken to render operation of smaller aircraft viable so as to encourage major investment in feeder and regional air services by the private sector.
  5. Training Institutes for pilots, flight engineers, maintenance personnel, air-traffic controller, security will be encouraged in private sector.
  6. Private sector investment in non-aeronautical activities like shopping complex, golf course, entertainment park, aero-sports etc. near airports will be encouraged to increase revenue, improve viability of airports and to promote tourism. CAA will ensure that this is not at the cost of primary aeronautical functions, and is consistent with the security requirements.
  7. Government will gradually reduce its equity in PSUs in the sector.
  8. Government will encourage employee participation through issue of shares and ESOP.
AIRPORT INFRASTRUCTURE
  1. The Government will aim at ensuring adequate world class airport infrastructure capacity in accordance with demand, ensuring maximum utilization of available capacities and efficiently managing the airport infrastructure by increasing involvement of private sector.
  2. Greenfield airport will be permitted by the Government where
    • the existing airport is unable to meet the projected requirement of traffic or
    • a new focal point of traffic emerges with sufficient viability and
    • the new location is normally not within an aerial distance of 150 kilometers of an existing airport
  3. Encouragement will be given to development/ construction in private sector of small airstrips/ helipads /heliports, which are smaller and cheaper to construct. These will be particularly suitable in remote hilly or island areas, large business, city centers, factory locations and at other important nodal points. This will also facilitate increase in small aircraft operations.
  4. Private sector participation
    • Private sector will be free to undertake
      • construction and operation of new airports/airstrips/ helipads/heliports including cargo complexes, express cargo terminals, cargo satellite cities and cargo handling facilities
      • upgradation and operation of existing airports/airstrips/helipads/heliports in consultation with the existing operator including cargo complexes, Express cargo terminals, cargo satellite cities and cargo handling facilities
    • Foreign equity participation will be permitted up to 74 % with automatic approval and 100 % with special permission of government
    • Private sector participation will include participation of state government, urban local bodies, private companies, individuals and joint ventures on Build-Own-Operate (BOO) basis or any other pattern of ownership and management depending on the circumstances.
    • Restructuring of major airports of Airports Authority of India will be undertaken through long-term lease to private investors for efficient management, improvement of standards of services/ facilities and attracting private investment
    • At privately managed airports, air traffic control (ATC) and aviation security will continue to be provided by the Airports Authority of India (AAI) and customs and immigration facilities by respective Government departments.
    • The equipment needed for any service would normally be provided by the agency responsible for the service and an equitable system would be established for sharing of revenue between different agencies. Keeping in view their respective investments and responsibilities.
  5. All airports /airstrips /helipads /heliports used for scheduled air-transport services will be licensed by Civil Aviation Authority.
  6. Airport/ airstrip/ heliport/ helipad operators will follow ICAO guidelines for levying airport/ airstrip/ heliport/ helipad charges based on cost recovery principle. The CAA would put in a place a regulatory mechanism to prevent abuse of monopolistic nature of such infrastructure.
  7. An objective and well-defined transparent mechanism for allocation of slots at airports will be ensued at all times.
  8. CAA will ensure fair play between different airport/ airstrip/ heliport/ helipad operators and user agencies so that no airport/ airstrip/ heliport/ helipad operator is accused of discriminating against any particular airline or any other user. Similarly, Government will ensure that no airport-operator is discriminated against with regard to allotment as point of call, if there is demand for air services from such airport.
  9. More international gateways shall be provided. It would be ensured that there is at least one international airport in every region of the country in order to give a boost to trade and tourism and adequate capacity in all the routes.
  10. Major thrust will be given for increasing the share of commercial revenue from non-aeronautical sources by giving total freedom to airport/ airstrip/ heliport/ helipad operators in the matter of raising non-aeronautical revenue.
  11. New Ground Handling regulations with following broad particulars envisage :
    • At airports managed by AAI, new private investors have been allowed by AAI to undertake ground handling besides national carriers and self-handling by carriers which will increase competition resulting in improvement in services and reduction in costs.
    • At private airports, at least limited competition will be mandatory.
  12. A rationalized dynamic system for airport charges for AAI airports will be introduced for
    • optimum utilization of airport by using peak and off-peak time charges,
    • increasing revenue of airport operators
    • promoting airports in far-flung regions by having varying airport charges from airport to airport depending upon the facilities available at the airport.
    • promoting use of small aircraft
  13. A new Directorate of Lands shall be established in AAI and land use guidelines will be formulated for utilizing vacant land.
    • Vacant land at airports will be evaluated for construction of aviation related activities (e.g. cargo complexes, aircraft maintenance facilities, etc)
    • For optimal exploitation of airport land for civil aviation purposes, private-sector/ State Government participation would be welcome.
    • Land at such airports where there is no likelihood of future use for civil aviation purposes will be utilized for other commercial purposes like gold courses, tennis, etc. either by AAI itself or in joint venture.
    • Effective steps will be taken for removing encroachments from AAI land and if necessary, comprehensive rehabilitation package will be formulated.
  14. Cargo handling
    • Infrastructure like satellite freight cities with multi-modal transport, cargo terminals, cold storage centers, automatic storage and retrieval systems, mechanized transport of cargo, dedicated express cargo terminals with airside and city side openings, computerization and automation etc. will be set up on priority basis.
    • Private sector participation in cargo handling will be encouraged.
    • Efficient Electronic Data Interchange systems will be developed and linked amongst all stakeholders in the trade.
    • Air cargo complexes and dedicated express cargo terminals (with airside and city-side openings) will be integral part of all major airports.
  15. Operation of airports would be in accordance with the provisions relating to prevention of air, water and noise pollution.
  16. Guidelines for naming of airports will be formulated to ensure that the airports are named after the cities they are situated in as per international norms.
  17. Air Traffic services
    • Air Traffic controllers will be licensed by CAA.
    • AAI will continue to provide Air Traffic Services over the Indian air Space as per standards set by CAA in accordance with ICAO norms.
    • Approach and aerodrome control services may be provided by licensed ATCs engaged by the airport operators
    • New satellite based CNS/ATM systems will be introduced as per ICAO's Regional Plan
    • India to have a significant say in the provision of new satellite based CNS/ATM services in Asia- pacific/ SAARC regional airspace
    • Fresh Air traffic Services and Controlling (Departure, holding and approach) procedures will be evolved for helicopters and small aircraft to exploit their inherent advantages and to reduce the cost of their operations and efficient use of airspace without compromising safety. This will also give boost to Flying Clubs.
    • Efforts will be made for Civil-Military co-ordination for
      • Greater sharing of civil and military airspace for unidirectional air-corridors and straightening of air-routes to save fuel and time,
      • Uniform air-traffic procedures ,
      • Additional slots for civilian flights at military airports,
      • Sharing of revenues at civil enclaves
  18. DOMESTIC PASSENGER AND CARGO AIR TRANSPORT
    1. The government will encourage provision of safe passenger and cargo air transport services to every region of the country at economic prices.
    2. It is necessary that both airline operations as well as airport infrastructure be treated as mutually dependent and complementary and given similar concessions to promote a balanced growth of the sector. Therefore, airline operations and acquisition of aircraft should be given the status of "infrastructure ".
    3. Private sector participation in providing domestic passengers and cargo air transport services will be encouraged.
    4. Permission to start scheduled passenger and cargo air transport service would be given by government on demonstration of competency, minimum capital requirement and viability of the company to provide a safe and reliable service. CAA may also fix a minimum number of aircraft for scheduled operators permit.
    5. Capacity induction will be regulated with a view to ensuring safety, security and preventing unhealthy levels of capacity.
    6. Government and CAA will ensure that there is no discrimination between different passenger and cargo air-operators.
    7. Foreign equity up to 25% and Non-Resident Indian investment up to 100% will be permitted for domestic passenger transport services. However, participation from foreign airlines either directly or indirectly will not be permitted. Substantive ownership and effective control by Indians will be a pre-requisite.
    8. Wet leasing of foreign registered aircraft by operators will be permitted only in special circumstances like grounding of aircraft, augmentation of capacity for short term, to meet the capacity requirements for handling natural calamities, etc.
    9. ATF will be taken out from administered price mechanism for petroleum prices. The price of ATF for domestic airline will, therefore, be governed by market and customs duty. Airlines will also be permitted import of ATF.
    10. There will be freedom to operate non-revenue and passenger charter and cargo flights to any foreign destinations. Indian passport holders will also be allowed to travel on these flights.
    11. Helicopter operations will be given a new boost by a total change in outlook. At present, fixed wing norms with minor changes are broadly applied to rotary wing aircraft. Fresh guidelines will be formulated in consultation with user industry from the point of view of rotary wing aircraft. Fresh Air Traffic Services and controlling procedures, which exploit the inherent advantages of helicopter without compromising safety, will be evolved. This will also reduce the cost of operations of helicopters and efficient use of airspace. Encouragement will be given to use of helicopters in the areas of heli-tourism, adventure sports, mountaineering/ trekking, point-to-point heli-services to bypass traffic congestion on the road, connecting remote areas and islands in Northeast, Andaman and Nicobar and Lakshdweep, religious places, sky crane for construction/ laying of transmission lines etc.
    12. Flying clubs, Aerosports like hang-gliding, ballooning, heli-skiing, para-jumping etc. will be promoted by encouraging private investment and formulating liberalized guidelines in consultation with users. This will include rationalized Avgas prices and liberalized air space control.
    13. Special consideration will also be given to Private operators and Corporate operators by way of rationalized Avgas prices, encouragement for construction of smaller airstrips/helipad et. in private sector.
  19. PROMOTION OF GENERAL AVIATION AND SMALL AIRCRAFT OPERATION
    1. There is need to open up the country and tap the latent demand for air services in many parts of the country currently not on the air map. However, the traffic profile in these areas does not permit viable operations of jet. Even smaller aircraft operations are not viable because of the high cost of operation and high break-even factor.
    2. While Route-Dispersal Guidelines do help in providing air services in the remote and inaccessible areas, further measures are required to encourage widespread air-connectivity. Passenger and cargo air transport services to many regions will not be possible unless operation of small aircraft is made economically viable either on stand alone basis or in conjunction with major trunk routes.
    3. Therefore, Aviation Turbine Fuel (ATF) for turbo prop aircraft operations will be provided at par with price for international air services, with a cap of 4% on sales tax. Operation of smaller aircraft/ charters will be further encouraged through rationalization of airport charges, Inland Air Travel Tax (IATT) and Avgas prices. For the NorthEast region, IATT has been fully exempted on all routes. Government will consider extending similar facilities to other category II areas.
    4. There is a need to change the traditional concept of airport development, ownership and operations in view of the economics of small aircraft/charters operations. Participation of state Government, urban local bodies, airline/ aircraft operators, other private investors will be encouraged in development, upgradation and management of small airports/ airstrips. These airports will be distinct from traditional airport and will be bare-bone type with no frills. Such airports need not be mandatorily manned and onus of ensuring security and safety of operations will rest on the aircraft operator in conjunction with the local administration/ bodies, etc. This will encourage the operation of small aircraft/ air taxis, as operators themselves or in collaboration with State Government / Urban local bodies/ residents of a specific locality, factory, nearby factories, tourist operators will be able to manage such airports/airstrip flexibly and efficiency at reduced cost. This will boost passenger transport and tourism
    5. Single engine aircraft of seating capacity upto 10 seats can be permitted for passenger charter and cargo flights. Such operations shall be in accordance with the single engine operation guidelines and over land areas having no hilly terrain or other obstructions.
  20. INTERNATIONAL AIR TRANSPORT
    1. The Government will aim at ensuring adequate capacity to fully meet the requirement of international trade and tourism.
    2. Liberal bilateral rights will be given for promoting international operations to less developed regions of the country as well as to ill-connected far away countries (e.g. Latin America) to promote trade and tourism in those regions.
    3. Government will ensure that traffic rights are utilized to the maximum extent possible through direct operations, creation of virtual equipment by way of joint flights, code sharing arrangements etc. by the two national carriers i.e. Air India and Indian Airlines. Other domestic carriers who fulfill the minimum criteria for designation as Indian carrier to operate international passenger flights will also be permitted to meet this objective. Initially, they may be permitted to fly to neighbouring countries against unutilised rights subject to right of first refusal by national carriers. The requirement of substantial ownership and effective control of the airlines by Indians would continue to be operative.
    4. There will be freedom to international tourist Charter operation to different custom airports.
    5. Government will also establish, in the long run, an objective and well-defined mechanism for sharing of international traffic rights amongst all airlines in a transparent manner.
    6. Government will ensure that there will be no discrimination between different airport operators in allotting capacity to foreign carriers as per bilateral agreements if demand exists.
    7. Efforts will be made by national carriers to join global alliances in their own commercial interest and in the interest of travelling passengers through code-sharing, exchange of frequent- flier programs etc.
    8. There will be no restriction on international cargo flights. However, they will not be allowed to carry domestic cargo on their flights within the country.
    9. Tourist charters from domestic airports to foreign destinations will also be permitted subject to safeguards for scheduled operations.
    10. Air India and Indian Airlines would be guaranteed the use of traffic rights actually being utilised by them for five years following privatisation.
IT POLICY INTRODUCTION
During the last quarter of this century Information Technology (IT) has transformed the way of human life as no other technology has. IT has potential of converting our society into a truly knowledge based society. IT also gives us a chance in ensuring that such an evolution leads to an equitable society. Now, there is no area of human life, which is not affected by information technology in one way or the other. To ensure that people of the State of Gujarat reap the benefits of this epoch making development, it is imperative that the State Government evolves a coordinated strategy which could affect all the facets of life of citizens of the State.
MISSION
To help improve processes in the Government by using computing devices, communication systems associated electronics and software to provide better delivery systems to the citizens. It is very clearly understood that IT is not an end in itself but means to provide better quality of life to the citizens of the State. It does not aim at merely automating existing process but the target is to use IT to improve overall organizational efficiency and pass the benefits to the citizens of the State.
OBJECTIVES
  • Over all IT growth in the state of Gujarat
  • To create enormous new employment opportunities in the state
  • To train and develop skilled manpower in IT
  • To facilitate information outlets at the doorstep of the common man
  • To make Government-Citizen interface more effective, efficient and transparent
This will enable people at large to access information related to - education, i.e. technical and non technical course offered by various institutions, admission procedures, admission list, results etc., health services - like various medical expertise available at different hospitals, on line medical services etc; transport service information - like bus arrival and departure timings, reservation facilities etc. Information Kiosks will also provide the on-line delivery of various application forms to the users irrespective of their location in the state.

CONNECTIVITY

State Government recognizes the importance setting up of an elaborate network to bring about a seamless transition between the various computing devices currently in use in the public domain or those, which may be put to use in future. Government also recognizes this network would act as core of IT infrastructure in the State. To ensure proliferation of IT, the department has decided to create this "information corridor ". The core of this corridor would be connecting the State capital right upto Taluka headquarters by first connecting the capital to the district headquarters .The district headquarters would be subsequently connected to the taluka headquarters. The State Government seeks to achieve this end by the year 2001." Information corridor" would be a major tool in implementing IT Policy in the State. IT would try to create this corridor by obtaining synergies with the existing networks in the public domain as well. On peripheries of this "information corridor" would be networks supporting databases of various Government departments as well as computerized public counters, kiosks/information centers that will help electronic interface of the citizens with the Government.

INFORMATION TECHNOLOGY IN GOVERNMENT

The usage of IT strategies in Government would be a key to improving processes which will ensure better delivery system to the citizens. This will also aim at creating transparent Government so as to fulfill the citizens' charter.
IT developments in State Government would be through the following stages:
  • For each department, identification of key area on priority basis needs to be computerized first .The criterion would be computerizing those systems first which improve the delivery systems for the citizens. This includes ration card, driving license, NA permission, Sales-tax Return etc. This is only an indicative list.
  • By completing these data base in a time-bound fashion and making them operational, delivery time for the citizens will have to be cut down demonstrably in a time-bound fashion.
  • To create greater convenience for the citizens, it would be imperative to create efficient/intelligent interface, which can take form of computer-supported counters, Kiosks etc. The Government would strive to ensure that all the forms required to be filled in by citizens for interface with the Government would be available for filling in electronically by the year 2005. Prior to this, citizens will have access to forms through Kiosks/other vendors by way of electronic devices. This would be achieved by the year 2002 AD. Choices for the citizens to obtain and complete forms by means other than electronic would also be kept open.
The system of information Kiosks would be the major integrators of various databases existing with various Government departments. Government will bring suitable legislation to guarantee protection of citizens related information which would be existing on various databases.
In order to ensure that there is no duplication of data entry and thereby to avoid confusion, the State Government would issue multi-purpose cards to all citizens of the State. These would be in the form of suitable smart cards. This will ensure security to individual information and would also provide one point coding system.

Enabling mechanism
  • All departments will prepare there IT Action Plan, which would have a one-year focus and a five-year perspective
  • One percent of the State Government budget would be committed to IT related activities which is expected to rise to 3% in the year 2005 AD
  • To ensure quicker availability of funds, a separate IT sub-head would be created within each major head. IT related funds will not be subject to any economy measures and they would be made available as far as practicable in lump-sum to the departmental heads rather than in the form of quarterly/monthly releases
  • To oversee implementation of IT strategies in the departments, each department will have Chief Information Officer (CIO) who would report directly to Secretary of the department. Considering the nature of mobility of IT professionals, such CIO would be recruited on contractual basis and recruitment would be freed from encumbrances of Gujarat Public Service Commission (GPSC).
  • All departments would create shareable databases of rules and other related information. This would include information such as budget, recruitment/service rules, plan achievements for various schemes etc.
  • Creation of E-mail system.
  • Creation of document imaging system to reduce paper work
  • Each department will create web page within the State Government's web-site to display grievance-handling procedure. By the year 2001 AD, facility would be provided to citizens for their grievances to be handled electronically as well.
  • Certain inter-departmental projects which have considerable significance as being underlying feature for all other IT related activities as well as of considerable importance for the well being of the citizens of the State would be given a special status of State IT Projects. This would include projects such as disaster management system, citizen's database, budget etc. Inter-departmental committee to be appointed hereafter would monitor them.
Where withal for achievements

Government has set up IT Department for implementation of IT Policy. IT department should remain a very lean department concentrating on policy aspects as well as monitoring of the implementation of the State IT policy.
An agency with fair amount of autonomy would be set up for helping various players in IT field and in implementing IT Policy. Among other things, this organization would also select consultants/specialists for providing services to various Government departments/agencies under broad framework contracts. Some of these would include :
  • Information strategy development
  • IT architecture design including network and communication.
  • Program and project management.
  • Contract support system.
  • Internet/intranet services.
  • Computer and communication security.
  • Systems audit
  • Disaster recovery.
  • Outsourcing including actual running of system.
  • Training.
  • Testing
This organization would also help augment its finance from various resources including raising from the market. Its services to Government departments/agencies would be strictly fees-based. It would also take up other activities such as hardware acquisition, software development, training etc. It will also maintain an inventory of technological developments in the field of IT and keep various Government agencies aware of the same. It would also work as an agency for identification of projects for private sector participation and would take up the work of procurement of private sector proponent as well in coordination with Gujarat Infrastructure Development Board.

As mentioned above, State Government is committed to providing resources for proliferation of information technology. It is proposed to commit at least 1% of the budget by 2000AD.

IT INCENTIVE POLICY
Information Technology ( IT ) Industry
Incentive Scheme (1999-2004)

Preamble
The Information Technology (IT) Policy of the state has acknowledged the potential of IT in transforming the society. The IT policy also emphasises the need to accelerate development of IT industry in the state of Gujarat. This in turn will help proliferate IT culture in the state and create large-scale employment opportunities. During the last few years, IT has been the fastest growing segment of the economy. This sector has created enormous potential for export and growth. To give an impetus to this industry, it is imperative that, the incentive policy takes into account the typical characteristics of this industry. Since, in IT industry, the investment in intangible assets tends to exceed tangible assets. The evolution of IT incentive policy has taken into account this factor as well.

TITLE
This scheme shall be known as Information Technology Industry - Incentive Scheme 1999-2004, hereinafter referred to as scheme.
Operative Period
This scheme shall become operative with effect from 01-04-99 and shall remain in force for a period of 5 years, from that date. However, a review of this scheme will be undertaken after two years, and based on the experience of State Government and the need of this sector, amendments to the scheme, if necessary, will be made.
Area Of Operation
It would be operative anywhere in the state of Gujarat.
Definition
  • " include computer, digital-data communication and digital data broadcasting products as notified by the Ministry of Finance, Government of India or Central Board of Excise & Customs.
  • "IT Industry" would include development, production and services related to IT products, IT Software and IT service. Appendix-I gives the list of IT industry heads.
  • The "Eligible New Information Technology Unit" means a new unit in IT industry set up after the cut-off date. It should also fulfil the following Criteria.
  • The new project should have obtained SSI registration from concerned District Industries Center or obtained the Letter of Intent, Letter of Approval or obtained receipt against filling of Industrial Entrepreneur Memorandum.
  • The new project should have a separate identifiable capital investment means that, it should not have any linkage with an existing manufacturing/IT Industry unit.
  • Eligible IT Unit
    It is an existing IT Unit which registers itself as an IT Industry after the cut - off date. Such an unit should have commenced production before the cut - off date.
  • Indian half Circuit- satellite communication link between two earth station via satellite (International segment) is divided into two parts, i.e. one earth station to satellite and the second part is Satellite to other Earth station. The segment between the Indian earth station up to satellite is "Indian half Circuit" and satellite to other earth station overseas, anywhere in the world is the Second Half Circuit.
  • Eligible Total Capital Investment
    It includes:
    1. Investment made in the land. The actual cost of the land including the legal charges incurred for acquisition of land needed for the project. A plot of land acquired under lease agreement except from GIDC Estate / Infocity on rental basis will not be considered as Fixed Capital investment.
    2. New building
      New building means building required for project including administrative building. The investment made in creating canteen, in-house training building for the staff of respective unit. The cost incurred on purchase of old building or repairing cost will not be made eligible for consideration as fixed capital investment. Residential accommodation for the employees of the unit, either constructed or bought would also be eligible. Old residential building will not be eligible.
    3. Machinery
      This includes plant & Machinery needed to set up 'Eligible New IT Unit'. This would also include 'IT Product' and 'IT Software'. IT Product and IT Software installed at the residence of the employees of the eligible new unit will also qualify subject to the limit of 5% of the Eligible total Capital investment. The cost of electrification, transportation, erection, installation will be capitalized under the head - plant and machinery. The investment made in acquiring air-conditioning plant/machine will also be eligible. Transport facilities like bus/buses for the conveyance of the workers from the surrounding villages/towns to the factory and back. Diesel generating sets of the capacity limited to the connected load. Plant for non-conventional source of energy. Cost of material handling equipment. Plant for purification or de-salination of water. Plant for pollution control measures. Testing facilities. The investment made in related furniture will be allowed up to 10% of eligible fixed capital investment.
      • Assets Acquired
        The eligible fixed assets acquired and brought up to twelve months from the date of commencement of commercial production will be eligible as "Eligible Total capital investment". No assets acquired, created and/or bought after the operative period of the scheme shall be considered eligible. Assets acquired under DGP scheme/under hire purchase scheme or installment system/lease scheme would be considered eligible, exclusive of cost of interest.
      • Ineligible Investment:- The following investment shall not be considered eligible for any incentives.
        1. Working Capital
        2. Commissioning fee
        3. Goodwill fees
        4. Royalty
        5. Preliminary and Pre-operative expenses.
        6. Second-hand equipments purchased or reinstalled/shifted
        7. Capitalised Interest
        8. Any other investment which is not expressly narrated as eligible.
        9. Technical know-how fee.
      • Eligible Turnover
        This is the turnover from "IT Product", "IT Software". It would be calculated on the basis of accounts submitted to the concerned Income tax authorities. Explanation: Turnover from "IT Services" undertaken by the company will not qualify for consideration under the eligible turnover.
      • Eligible Incremental Turnover
        This is the difference between the eligible turnover of the current year and the eligible turnover of the previous year.
      • Cut-off Date: 01-04-1999
The Industrial policy

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ROAD POLICY - December 1996

Roads & Building Department
Government of Gujarat

Introduction
Transportation plays a principle role in Economic and general development. A well laid out road network is essential for efficient and cost effective movement of men and materials, without which trade and industry cannot maintain a competitive edge. At the present juncture, when the country is witnessing phenomenal all round growth as a result of economic restructuring, an efficient and dependable Road Infrastructure is absolutely crucial and needs to be accorded overriding priority. There has been a tremendous increase in the share of road transportation vis a vis rail over the last four decades with the total freight movement increasing from 11% to 60% and the passenger movement from 26% to 80%. In other words, our economy which was earlier rail dominated, has now become predominantly road dominated.
In so far as the State of Gujarat is concerned, the road network has registered an eight fold increase from a mere 7622 Kms (1947) to 70609 Kms (1995). Even though the existing road network in Gujarat is qualitatively rated as the best in the country, it is grossly insufficient, and is in need of major upgradation and improvement in order to meet with the present transportation needs. Recognising this fact, Government of Gujarat has decided to accord special priority to road development and to revamp the road policy with a view to effectively meet with the challenging task ahead.

Composition of Roads
The total length of roads in Gujarat State has increased from 45,108 kms in 1980 to 70,609 kms in 1995, of which, the surfaced road length has increased from 29,895 kms to 64,028 kms over the same period. As a proportion of total road length, surfaced road length was increased from 66.27% in 1980 to 90.67% in 1995. The growth in surfaced road length approximately at an annual rate of 5.2% which is quite significant, has been primarily driven by the growing importance of the road transport system in the movement of passengers and goods. Of the total road length, in 1995, Gujarat has 1,570 kms of National Highways, 19,655 kms of State Highways, 20,364 kms of Major District Roads, 10,355 kms of Other District Roads and 18,665 kms of Village Roads. The National Highways network in Gujarat is in very good condition. The State has undertaken four laning of important sections of National Highways with the provision of Paved shoulders where necessary. In fact, of the total stretch of 375 kms of the National Highway connecting Ahmedabad to Bombay, about 166 kms have been four lane and the entire length has been provided with paved shoulders. Over the last decade and a half, the proportion of State Highways and Major District Roads in the total road length has increased significantly.
LENGTH IN KMS
Category/Year 1980 1985 1990 1995
NH 1435 1421 1572 1570
SH 9097 9387 16430 19655
MDR 10542 11195 21931 20364
ODR 10671 12330 10022 10335
VR 13463 23512 15610 18665
Total 45108 57845 65565 70609
Vehicle Density
Over the last decade and a half, registered motor vehicles have grown at an annual rate of approximately 14%, resulting in a three fold increase in the overall vehicle density. On the State Highways, vehicle density has increased from 50 to107 vehicles per km. Passenger buses have recorded a two fold increase, two wheelers have increased seven fold, passenger cars three fold and goods vehicles three fold.

Technological Upgradation
Gujarat has traditionally been known for its good road transport system and has probably the best maintained road network in the country today. The Roads and Building Department has continuously endeavored to acquire modern technology for road construction to meet the rapidly growing demands on the road transport system. Gujarat was the first state to take up road construction using hot mix plants and pave finisher since the early seventies and even village roads in Gujarat are now mechanically constructed. The State has more than 100 hot-mix plants of which, 10 modern hot-mix Plants and pave finishers are owned by the Roads and Buildings Departments itself. The State has since long introduced modern specifications like wet mix macadam, dense bituminous macadam, and asphaltic concrete. It has also introduced other modern machinery like vibratory rollers, wet-mix macadam plants, motor graders, full width sensor paves, etc.

Plan Outlay
Plan outlay on Roads and Bridges has increase progressively from Rs.2200 million during the Sixth Plan to Rs.2578 million during the Seventh Plan and Rs.3500 million during the Eighth Plan. The provision of funds for maintenance of State Roads has also increased from Rs.904 million in 1991 to Rs.1695 million in 1994-95.

Connectivity
The initial thrust of the Five Year Plans has been towards achieving village connectivity. Out of 18,028 villages in the State, only 1,090 villages remain to be connected by all weather roads. All villages are planned to be connected by all weather roads by the end of 1997.

World Bank assisted Gujarat Rural Roads Project
The State Government has very recently successfully completed a Rs.350.00 crores World Bank Assisted Rural Road Project, wherein about 6100 Kms of new construction/reconstruction and improvement of rural roads have been completed in 13 out of 19 districts in the state. This is probably the most successful World Bank assisted Road Project in the country to date.

Road Development Plan
The total length of roads proposed to be developed according to the Gujarat Road Development Plan for 1981-2001 has been divided into the following categories, for which the total development cost works out to Rs.20094 million.

Though Gujarat has a better maintained road system than all other states, the tremendous increase in traffic has created a grave disparity between the carrying capacity and demand. As a result, there is a pressing need for immediate remedial measures in the form of strengthening and capacity augmentation. The deficiencies are likely to be further compounded due to the following reasons.
  • About Rs.500000 million worth of new industries are already in various stages of installation in the state.
  • The Sardar Sarovar Narmada Project, the largest water resources development project in India and probably in the world, providing Irrigation benefits to about 18 lacs hectares spread over 18 districts and with an installed capacity of 1450 MW is expected to be fully operational in the next few years.
  • Development of ports is expected to generate very huge interstate traffic.
  • Rail Transport System The share of Railways in movement of passengers as well as goods has been persistently declining. This is primarily due to the higher flexibility of road transport. The total railway network in the state comprises 2457 kms of broad gauge. 2523 kms of meter gauge and 874 kms of narrow gauge. However, upgradation to broad gauge and consequent switching over to a unigauge system that has been taken up countrywide, would prove very helpful. The inter modal approach of the road policy incorporates tapping the full potential of railway network, particularly for long distance haulage.
  • Ports Gujarat is a maritime state with a coast line of about 1600 kms which accounts for almost 30% of the country's total coast line. Of the 139 minor and intermediate ports in the country, 40 are located in Gujarat with Kandla being the only major port in the state. The ports of Gujarat influence a vast area extending over central, western and northern India. This vast hinterland offers tremendous potential for ports development. The minor and intermediate ports of Gujarat handle about 8.5% of the national shipping cargo and 70% of the total cargo handled by all minor ports of India. The present as well as projected traffic from the ports has been accounted for in the formulation of the road policy. Three major corridors for movement of port traffic have been identified. They are as below :
  • Ports around the Gulf of Kutch linked to the northern states through NH 15 and NH 14.
  • Ports in southern Saurashtra connected to Ahmedabad.
  • Ports in South Gujarat linked to the proposed Vadodara-Bombay Express Way.
Objectives

The basic aim of all the developmental policies of Government is to work towards rapid economic and social upliftment, while simultaneously ensuring that the growth achieved is balanced, and the accruing benefits are evenly spread. The road Policy is structured for providing an efficient road network across the length and breadth of the State so as to effectively meet with the transportation needs of every sector, cost effectively and with the right inter modal mix. Connectivity and easy access being basic to all other developmental activities, a conscious effort has been made to integrate the backward and far flung areas into the road network. The objectives of the road policy could be summed up as follows :
  • To provide connectivity to all villages by all weather roads by the end of 1997, and thus, further improve quality of life in rural areas, in terms of quick access to health services, better education, social services, etc.
  • To provide an adequate and efficient road system encompassing all transportation needs so as to ensure smooth and uninterrupted flow of goods and passenger traffic both within the State as well as on interstate routes.
  • To constantly upgrade technology by inducting superior and quicker construction and maintenance methods with a view to reducing the total transportation cost as well as to reduce the overall life cycle cost of roads.
  • To induct more scientific principles of resource allocation for maintenance and new construction programs.
  • Overall, to set high standards of road safety and travel comfort.

Strategy & Approach
In order to meet the steeply growing transportation needs of the state, the existing road network is planned to be upgraded by :
  1. Removing the deficiencies in the existing road length by an optimal combination of widening and strengthening of selected stretches/corridors.
  2. Providing new links particularly in areas of concentrated industrial growth and to speed up the movements of agricultural and dairy products.
  3. Providing missing bridges and cross drainage works.
  4. Connecting the remaining villages by all weather roads.
  5. Replacing existing level crossing by road overbridges.
  6. Improvement of road geometric and safety provisions.
  7. Removing regional imbalances in the road network.
All this calls for massive capital investment which cannot possibly come from any single source of funding. It is, therefore, envisaged to adopt a multi pronged strategy for resourcing funds for the purpose.
  • Optimal use of available resources
    Government has carefully prioritised the investment programme in road infrastructure so as to ensure efficient use of resources. Routes have been prioritised for widening/strengthening on the basis of commercial traffic, both existing and projected. The angle of inter-model efficiency is specifically accounted for in the planning.
  • Privatisation
    In view of the acute paucity of budgetary resources, it has been decided to go in for private funding of road projects in a big way. A list of carefully selected projects is being prepared for the purpose.
    The state is geared up to facilitate private funding and all basic spade work for it has been done. The main provisions made are briefly as under:
  • Enabling Legislation
    To facilitate private sector participation in road projects, the Gujarat Government has amended the Bombay Motor Vehicles Act, 9 of 1994, which permits the levy of toll on either new construction or strengthening/improvements of road and bridge projects. A comprehensive set of rules which would provide further guiding framework to facilitate private sector participation is under finalisation. The relevant portion of the modified Act is kept as Annexure-C.
    Guidelines framed for private sector participation are enclosed as Annexure-B.
  • Procedure for Selection of Party
    Parties will be selected on the basis of open competitive bidding ensuring transparency and equal opportunity to bidders. Selection will be based on evaluation of bids by a high level empowered committee set up for the purpose.
  • Incentives
    To ensure commercial viability of road projects, an appropriate combination of the following incentives can be considered by the State Government.
  1. Acquiring land at Government cost for right of way.
  2. In cases, wherever levy of toll alone is not enough for ensuring financial viability, Government could consider providing additional land to the investor for commercial development so as to augment returns.
  3. Granting advertisement and air space rights within the right of way.
  4. Subsidising loss of revenue due to traffic being less than that projected.
  5. Exemption from royalty on construction materials.
  6. Granting permission for plantation of trees and deriving revenue thereof in the land width during concession period.
  7. Utilisation of Government quarries in the vicinity of the project.
  8. Allowing construction in segments and levying of toll on completed segments so as to utilise the toll revenue to complete the remain segments.
  9. Government/Government Corporation's equity participation in Special Purpose vehicles formed for individual road projects.
  10. Funds from external funding agencies
    In view of the huge backlog in upgradation of existing roads, substantial use of funds from external lending agencies has been planned.
  11. Schemes with beneficiaries participation
    The State Government has already adopted a policy of taking up industry specific roads with the beneficiary industries bearing 50% to 70% of the cost, the remaining being borne by the Government. A good number of works have been already taken up and completed on this pattern.
  12. Resource mobilisation
    The State Government is examining alternative sources of revenue for road development and this could include a special levy on fuel.
  13. Funding by Philanthropists
    The State Government has also developed a scheme to involve philanthropists and the general public in undertaking the construction and improvement of rural roads wherein they would meet 75% of the cost and balance would be contributed by the Government.
Implementation

Implementation of the road policy would be done by the Roads and Buildings Department through a special implementation cell for ensuring speedy disposal.

The State Government will set up a high level committee headed by the Chief Secretary to review the progress and implementation of the road policy.

The progress made on the implementation of the policy will be periodically reported to the Infrastructure Development Board of the State Government.

PORT POLICY Ports & Fisheries Department
Government of Gujarat
INTRODUCTION
Gujarat, situated on the western coast of India, is a principal Maritime State endowed with favorable strategic port locations. The prominence of Gujarat is by a virtue of having nearly 1600 kms long coastline, which accounts for 1/3rd of the coastline of India and being the nearest maritime outlet to Middle East, Africa and Europe.
In 1991, Government of India initiated various economic, trade and industrial reforms, through the policy of liberalisation to enhance industrial and trading activities. The rationalisation of import duties and stress on export promotion have seen imports increasing by 24% and export by 25%. Gujarat State, is one of those frontline States that can take up the policy of liberalisation and privatisation, announced by the Government of India through a process of globalisation.
Gujarat itself is experiencing a phenomenal interest in investment both from Mega-Industrial sectors within the country and also from top Multi Nationals abroad. Investment to the tune of $ 30 billion are already in the pipeline. From an analysis of the present investments and those that are flowing in, one can perceive a particular trend which is manifesting itself - investments are converging in and around potential port sites. Investments of over Rs. 16.000 crores are taking place at Hazira, Rs. 15,000 crores are planned at Vagra. Rs. 20,000 crores are planned in areas near Pipavav and near Jamnagar port locations. The logic of locating these industries is rather clear, viz., the large business houses want to import industrial raw-materials and want access to the international market through sea routes, which is definitely more viable and feasible as against the surface transport or air transport.
Another major advantage is that, Gujarat has a vast hinterland consisting of fast developing Northern and Central Indian States generating cargo. The State of Rajasthan,Madhya Pradesh, Western Uttar Pradesh, Delhi, Haryana, Punjab, Himachal Pradesh and Jammu & Kashmir, which constitute 35% of the total exports, are potential customers for Gujarat ports. Export of surplus foodgrains from these major grain producing States and import of fertilizers to these major consumers, offer great potential for growth of cargo in near future. Any economic development, taking place in these hinterland States have a direct bearing on Gujarat ports.
Indian ports handled 197 million tones of cargo in 1994-95, 90% of which were contributed by the Major Ports. The port activity, in terms of ship turn-around time, waiting time and average ship per day output, has a significant influence on development scenario. The existing major ports are under tremendous pressure to handle the increasing cargo traffic, resulting into demurrages and huge loss in the foreign exchange.
In the global scenario, during the last decade, new technology development has taken place, especially in the container handling equipment and new port layout to accommodate container traffic. This technology development demands new institutional set-up and major investments to help in solving the problems of port modernisation. With the global shipping industry introducing suppressed vessels, the Port of Future will be totally integrated with inter-modal cargo flows and co-ordinated sea vessels and hinterland vehicle arrivals and departures. The new proposed port locations of Gujarat are highly suited to adapt itself, to the current technology development in the areas of communication, automation, cargo handling and ship technology, which needs drastic changes in the physical layout of ports as well as equipment's, operations and management. It is in this perspective that it is imperative, Gujarat approaches the problem, by focussing on an integrated strategy, incorporating 25 to 30 years future demands scenario. It makes itself evident, that any globalisation that is to take place, has to take place through ports of international class.

PRESENT STATUS OF THE GUJARAT PORTS
  1. Along the 1600 Kms. of coastline of Gujarat, there are 41 ports, of which Kandla is a major port. Out of remaining 40 ports, 11 are intermediate ports and 29 are minor ports under the control of Gujarat Maritime Board.
  2. These ports can be broadly classified into three categories :
    • Three all weather ports viz: Porbandar,Okha and Sikka with all weather direct berthing facilities.
    • Seven ports are all weather lighterage ports.
    • The remaining thirty ports are fair weather lighterage ports for sailing vessels and fishing boats.
The minor and intermediates ports of Gujarat handle about 8.5% of national shipping cargo. Nevertheless, Gujarat ports handle about 16 million tones of cargo, which account for 70% of the total cargo handled by all minor ports of India.
Draft of 8 to 10 metes are available at Porbandar. Okha and Sikka, where ships ranging from 15000 to 25000 tones are directly berthed. Except for Porbandar which handles cargo containers for fish exports, container cargo handling facilities do not exist in other ports. There is limited scope for expanding berthing facilities in the existing minor and intermediate ports.All that possible is, to enhance the handling facilities by modern equipment, which can increase the traffic from present 16 million tones to 24 million tones. Due to the inherent limitation in the existing ports, it is essential to identify potential green field sites on Gujarat coast for port development.
With major coastal based Mega cement plants coming up in Kutch and Saurashtra, cement and clinker export through sea will play a major role in marketing of cement nationally and internationally. Similarly, proximity of Gujarat coastline to Middle-East countries open up avenues for locating petroleum refineries and storage of petroleum products for hinterland consumption. Export of salt and import of coal are other major potential cargo apart from the existing items of import and export. As indicated earlier, the massive spurt in the industrialisation also opens up scope for import of industrial raw-materials and export of finished goods to the global market through ports. The vast coastline of Gujarat, also offers tremendous potential for marine fisheries and subsequent processing and exports. Over and above this, any development in the hinterland States have a direct impact on Gujarat ports.
Against this future potential, at present, the ports are being planned totally in isolation, without taking into consideration the requirements of industry, trade and commerce. No integrated plan exists to create ports of international design and status, linked with hinterland with multi-channel roads that carry cargo efficiently and other related infrastructure.
Pipavav port is an ideal location for a direct berthing port facility. Gujarat Maritime Board, alongwith a private sector company, is developing this port as a joint venture project. An estimated Rs. 260 crores is likely to be invested in Pipavav port during the coming five years,developing it into a modern port in the Saurashtra region.

OBJECTIVES
Based on the above mentioned emerging scenario, the following objectives are identified for the new Port Policy.
  • To increase Gujarats share in the Export and Import sector, in national and international Trade & Commerce, in pursuance of liberalisation and globalisation policy.
  • To decongest the overburden on existing major ports on Western India to cater to the needs of increasing traffic of western and northern States, by providing efficient facilities and services and to support the countries domestic and international trade.
  • To handle 100 million tones of cargo in Gujarat Maritime waters accounting approximately for 25% Indias total cargo by 2000 AD.
  • It is estimated that 50% of total industrial investment coming to Gujarat will be port-based. To provide port facilities to promote export- oriented industries and port- based industries.
  • Taking fullest advantage of the strategic location of Gujarat coast, in the World Maritime Scenario,
    • to encourage ship building, ship repairing and estalish manufacturing facilities for Cranes, Dredgers and other Floating Crafts
    • to provide facilities for coastal shipping of passenger and cargo traffic between Kutch, Saurastra and South Gujarat and further extension of these services to important places like Bombay, Goa etc.
  • To fulfill future power requirements of Gujarat,
    • by establishing barge mounted power plants.
    • by providing exclusive port facilities for importing different kinds of power fuels, and
  • To attract private sector investment in the existing minor and intermediate ports and in the new port locations.
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