SME Cluster Series 2014 - Delhi
  

Dun & Bradstreet - British Airways SME Cluster Series 2014 : Delhi

 

About Delhi

With its historic legacy and splendid ancient monuments, Delhi emerged as an important centre for various activities after the city became the capital of India in 1911 after Kolkata. Delhi was made a Union Territory in 1956. With the 69th constitutional amendment, Delhi became a legislative assembly with the enactment of the National Capital Territory Act, 1991 and enforcement of legislation in 1993.

Over the years, Delhi, the National Capital Territory (NCT) of India, has emerged as a vital hub for trade, commerce, industrial activities, and hospitality. A centre for the Government of India (GoI) as well as the Delhi State Government, Delhi is also an important academic hub of India.

NCT of Delhi spreads over an area of 1,483 sq km, out of which 1,113.7 sq kms is urban and 369.4 sq kms is rural. This territory has seen rapid urbanization over the years and currently possesses state-of-the-art airport, rail, and road infrastructural facilities, stadia, museums, and cultural centres.

With 17 mn inhabitants, this metropolis possesses literacy rate of 86.34%, much higher compared with the national average of 74% according to Human Development Report 2013, Government of NCT of Delhi.

It is the second largest urban agglomeration in India with an urban population of more than 16 mn. It was the eighth largest urban agglomeration in the world during 2000, expected to be the third largest by 2025 according to the United Nations, World Urbanization Prospects, the 2007 Revision.

According to Human Development Report 2013, Government of NCT of Delhi, Delhi is one of the most prosperous states with the highest per capita income of more than ` 0.2 mn in FY13 compared with other states in India. Delhi is ranked amongst the top 40 cities (37th rank) in the world in terms of wealth according to world wealth report 2011. Further, Delhi sees considerable in-migration from neighboring and other states with 75,000 people moving to the city every year.

Geography

Delhi is situated in North India between the latitudes of 28°-24’-17”and 28°-53’-00” North and longitudes of 76°-50’-24” and 77°-20’-37” East. Delhi borders Uttar Pradesh and Haryana and spreads over an area of 1,483 sq. kms. Its maximum length is 51.9 kms and the greatest width is 48.5 kms.

The state of Delhi is further divided into nine Districts – Central, East, New Delhi, North, North East, North West, South, South West, and West.

Demographic indicators

Area

The NCT of Delhi spreads over an area of 1,483 sq kms. With the rapid urbanization process, the rural area is constantly declining, as per Census Reports. The number of villages has dropped from 300 in 1961 to 209 in 1991, to 165 in 2001, and to 112 in 2011.

Population

Delhi accounts for 1.4% of India’s total population. Delhi’s overall population has grown at a compounded annual growth rate (CAGR) of 1.9% during 2001-2011. The state’s population during the decade 2001-2011 grew at a decelerated rate of 21% compared with 47% during the previous decade of 1991-2001, which may be attributed to a fall in fertility rate and substantial growth in population in other towns of the National Capital Region (NCR). Further, the rate of in-migration in Delhi has stabilized, with many migrants now moving to other towns of the NCR.

With the rapid growth of urban population, the rural population is constantly declining, as per Census Reports. Delhi’s rural population has declined from 0.9 mn in 1991 to 0.4 mn in 2011.

The rapid population growth has resulted in an increase in the density of population from 6,352 persons per sq kms in 1991 to 9,340 persons per sq kms in 2001 and further to 11,297 persons per sq kms in 2011.

Literacy Rate

The government’s emphasis on the education sector in Delhi has resulted in an increase in literacy rate from 75.3% in 1991 to 81.7% in 2001 to 86.3% in 2011 as per the Census Reports. The literacy rate in 2011 was 91% for males and 80.9% for females. The rural and urban literacy rates of Delhi stood at 82.7% and 86.4% respectively in 2011.

Employment

Delhi has seen significant infrastructure and economic growth for the past many years, which have cumulatively contributed to a rise in employment opportunities.

The estimated employed persons in Delhi increased from 3.9 mn during the 55th round in 1999-2000 to 5.3 mn in 66th round during 2009-10. The share of employed persons in the total population grew constantly during all rounds of the National Sample Survey Organization (NSSO) except during the 64th and 66th Round.

As per the NSSO Survey, the estimated number of unemployed persons in Delhi stood at 0.2 mn during June 2010. The estimated number of workers during 2010 was at 5.5 mn. The unemployed persons accounted for 3.2% of the labour force.

Economic Scenario

With a robust economy, Delhi accounts for 3.8% of national GDP. Gross State Domestic Product (GSDP) of Delhi has recorded 9% growth compared with the national average of 5% in FY13.

The GSDP at current prices of the state increased 3.5 times from ` 1,003.3 bn in FY05 to ` 3,657.3 bn in FY13. The GSDP at constant prices (2004-05) stood at ` 2,209.7 bn in FY13, registering a CAGR of 10.4% during FY05-FY13.

Similarly, the Net State Domestic Product (NSDP) of Delhi at constant prices stood at ` 2,079.1 bn in FY13 registering a CAGR of 10.3% during FY05-FY13. The per capita income of Delhi at constant prices showed a CAGR of 8.3% during the same period.

The per capita income at current prices stood at over ` 0.2 mn per annum in FY13, which is three times more than the national average and the highest in India.

Sectoral Composition of GSDP

Similar to urban economies, the service sector contributes to majority of the income of Delhi. More than 80% of Delhi’s income came from the service sector whereas less than 20% from industrial sector and less than 1% from the primary sector in FY13.

The tertiary sector (comprising trade, hotels and restaurants, transport, communication, financial and insurance services, real estate, public administration, and other social and personnel services) is the major driver of Delhi’s economic growth. Its share in GSDP at constant prices has grown from 80.5% in FY05 to 85.8% in FY13.

However, the share of primary sector (consisting of agriculture, livestock, forestry, fishing, mining, and quarrying) in GSDP has seen a decreasing trend during FY05-FY13. The share of the primary sector is less than 1% as on FY13 on account of decreasing rural and cultivable areas due to the rapid urbanization process. The contribution of the secondary sector dropped from 18.5% in FY05 to 13.6% in FY13 due to movement of industrial units and the closing of polluting industrial units.

Infrastructure

In Delhi, infrastructure has been a key focus area to cater to the urban population’s demand. The urban population accounted for 97.5% of the total population of Delhi, as per 2011 Census. Delhi also accounted for 1.4% of the total population of India, as per 2011 Census.

Power

Over the years, Delhi has seen decreasing rural areas and agricultural activities due to the rapid pace of urbanization. Thus, there is thrust on the energy sector in Delhi to meet the growing power demand. The Delhi Government announced power sector reforms during the 10th Five-Year Plan with the corporatization of transmission and generation and privatization of distribution of power.

The power transmission network in Delhi comprises 400 KV ring around the periphery of Delhi interlinked with the 220 KV network spread across Delhi. The installed generation capacity in Delhi as on January 31, 2012 stood at 951 MW.

Transport

Delhi has evolved as a major wholesale trade center for North India. Delhi is the nodal point for five national highways (NH-1, NH-2, NH-8, NH-10, and NH-24) carrying huge volumes of passenger and goods traffic. Further, the road network of Delhi has grown from 28,508 kms in 2001 to 32,663 kms in 2011 to 33,198 kms as on Mar 2013. Delhi is also a major junction on the rail map of India. There are four main railway stations - New Delhi, Old Delhi, Hazrat Nizamuddin, and Sarai Rohilla besides container depots at Patparganj and Tuglakbad. Northern Railway constructed a new railway station at Anand Vihar to aid in decongestion at New Delhi and Old Delhi railway stations. Equipped with modern facilities and state-of-the-art designs, the Mass Rapid Transit System (MRTS) offers non-polluting and efficient rail-based transportation integrated with the road transport system. Delhi Metro is divided into two phases - Phase 1, which has been completed and commissioned, covers 65.1 kms and Phase 2 covers around 122.4 kms, which has also been completed. Further, the government of NCT of Delhi has dispatched ` 12.6 bn during FY12 to augment another 103 kms for MRTS phase III. Moreover, three Inter State Bus Terminals (ISBTs) are operational as on 2013 catering to average 0.4 mn passengers and 5235 buses/trips per day. Master Plan of Delhi 2021 proposed five ISBTs for Delhi. Thus, two more ISBTs are proposed to be built on BOT basis. To encourage road based public transport, dedicated corridors of bus lane have been proposed. Thus, Bus Rapid Transits (BRT) projects are under way. Indira Gandhi International (IGI) Airport caters to the international and domestic air passenger movement in Delhi. The IGI Airport is one of the largest airports in India and one of the best in the world, as it handles 34.4 mn passengers annually (FY13) and total aircraft movements in FY13 stood at 0.3 mn. Terminal 3 at the IGI Airport, which was inaugurated in 2010, is an international and domestic terminal with a capacity of 34 mn passengers per annum.

Education

Educational institutions in Delhi consist of government, government-aided, and private institutions, of which governmentowned institutions account for 40% share. Due to the thrust on education, literacy rates in Delhi have grown from 38% in 1951 to 86% in 2011. The Government of NCT of Delhi deploys more than 10% of plan funds to the education sector. The plan expenditure on this sector in Delhi grew from 8.5% in FY08 to 9.6% in FY12. The number of educational institutions in Delhi has grown from 4,862 in FY05 to 5,073 in FY12. The number of higher educational institutions in Delhi during FY11 stood at 207. Some of the renowned universities of Delhi include the Indian Institute of Technology, All India Institute of Medical Sciences, Jawaharlal Nehru University, and Indira Gandhi National Open University (IGNOU) among others.

Industrial Scenario

Delhi has emerged as a key redistribution centre due to its strategic geographical location and infrastructure. The wholesale markets in Delhi deal in 27 key commodities consisting of textiles, auto parts and machinery, stationery, food items, and iron and steel, as per the Master Plan document 2021 of DDA. The trade and commerce segment in Delhi is also vital due to its substantial contribution in terms of tax revenues and employment generation.

Delhi is one of the largest trade and consumption centre in North India. Delhi has a large presence of textile manufacturers followed by metal products and parts, machinery and transport, equipment-machine tools including electrical appliances, paper and paper products, rubber, plastic, petroleum, coal products, basic metal and alloy industry, repair of capital goods, and repair services among others. As Delhi is a metropolis and the capital of the country, it focuses on promoting hi-tech, sophisticated, export oriented, small-scale industries.

The following are some of the prominent public sector undertakings (PSUs) in Delhi:

  1. Delhi Transport Corporation, New Delhi
  2. Housing and Urban Development Corporation Ltd.
  3. HUDCO Bhawan, New Delhi
  4. Indian Renewable Energy Development Agency Limited (A GoI Enterprise), New Delhi
  5. Mahanagar Telephone Nigam Ltd, New Delhi
  6. Indraprastha Gas Ltd, New Delhi
  7. Intelligent Communications Systems India Ltd, New Delhi

Some power plants such as Badarpur Thermal Power Station and Rajghat Power Station are also managed by the Public Sector in Delhi.

Industrial Estate

According to the Economic Survey of Delhi FY13, there are 29 approved industrial areas and five flatted factory complexes in Delhi. Further, 22 non-confirming industrial clusters have been informed for development. Delhi State Industrial Infrastructure Development Corporation (DSIIDC) is the agency for development, operation, and maintenance of all industrial estates in Delhi.

Currently, Delhi has 32 planned Industrial Estates and flatted factory complexes. Out of these, 21 Industrial Estates are under Delhi Development Authority (DDA) and the rest are under DSIIDC and Industry Department.

Working factories

The number of working factories in Delhi grew from 7,921 in 2008 to 8,557 in 2012. Similarly, the estimated workers employed in these factories grew from 364,053 in 2008 to 392,270 in 2012. On an average, 46 persons work in each factory in Delhi. The estimated employment showed no substantial improvement during FY09-FY11 because of the closing of many polluting industries in Delhi. The industries that provided higher level of employment during 2012 include textile products followed by metal products and parts of machinery and transport equipment, repair of capital goods, and repairs services, paper and paper products, food products, rubber, plastic, petroleum, coal products, leather and leather fur products, chemical and chemical products, and misc. items.

Annual Survey of Industries

The number of registered factories in Delhi declined from 3,413 in FY03 to 2,878 in FY11. During the same period, the production capital increased from ` 60.5 bn to 126.9 bn. The number of employees declined from 0.13 mn in FY03 to 0.12 mn in FY11.