A holy city’s industrial dip

The Haridwar model is worthy of policy emulation

May 18, 2022 12:15 am | Updated 12:15 am IST

Officials of Hero Honda Motors at the Haridwar plant.

Officials of Hero Honda Motors at the Haridwar plant. | Photo Credit: Kamal Narang

Haridwar is a well-known pilgrimage site. Little known, however, is the district’s industrial face. A closer look at Haridwar’s development trajectory reveals how the district was able to achieve this feat over 20 years.

Haridwar is one of the 112 districts under the government’s Aspirational Districts Programme, launched in 2018. A key driver of socioeconomic growth in Haridwar is its vibrant and dynamic industrial township.

In 2002, the Uttarakhand government established the State Industrial Development Corporation of Uttarakhand Limited (SIDCUL), with the objective of catalysing industrial growth. This was reinforced with the Centre’s 10-year concessional industrial package for Uttarakhand, announced in 2003, which granted various fiscal incentives for industry setting up operations in the State. Haridwar was identified for developing an Integrated Industrial Estate. The estate was established at Roshanabad in Haridwar.

The development of physical and social infrastructure in the city coupled with the provision of economic incentives attracted a diverse set of industries to the district, including automobiles, pharmaceuticals, electronics, FMCG, packaging, agro and food processing. Today, the industrial township is home to heavyweights such as BHEL, Hero MotoCorp Limited, and Hindustan Unilever Limited. Prior to 2003, Roshanabad and its adjoining areas were akin to ghost towns. Today, the SIDCUL-IIE in Haridwar has about 700 large industries and MSMEs.

The spillover benefits from the development of the industrial cluster have been many. From the industries’ perspective, the clustering of economic activity reduced costs and provided access to a large local market and a skilled and unskilled labour pool. From the district’s standpoint, the industrial hub provided employment to 52,000 formal workers and more informal workers. In addition, lakhs of individuals are employed in sectors that provide ancillary services to these industries. This industrial progress has accelerated developments in the district’s social infrastructure — hotels, commercial complexes, malls, theatres and schools. A bonus benefit from these industries is their contribution to social development via corporate social responsibility (CSR) initiatives. From girls’ toilets constructed by ONGC to basketball courts funded by Hero Honda, Haridwar’s schools have undergone a dramatic and rapid transformation.

But all this has also created issues such as traffic congestion and overcrowding. There is an urgent need to optimise logistics, develop supply chains and address inefficiencies in transportation and connectivity to ensure that Haridwar realises its industrialisation potential. Since Haridwar is land-locked, producers have a cost disadvantage as they have to incur higher costs for movement of goods. Traffic congestion across the district delays cargo movement and adds to transaction costs, thereby reducing competitiveness. Inefficient warehousing is another bottleneck. It is critical to develop larger, integrated warehouses which can be used for production, packaging and storage across the district. For sustaining growth momentum in the long-term, investment in human capital is crucial. While education has been a priority over the years, health is an area that merits greater policy attention. Steps must be taken to invest in health infrastructure and address the acute shortage of health personnel across the district.

Haridwar has made remarkable strides in socioeconomic growth over the last few years. As aspirational districts across the country continue to embark on transformative journeys, Haridwar’s SIDCUL-IIE model is definitely worthy of policy emulation.

Tanushree Chandra is a Young Professional, NITI Aayog. Views are personal

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