Economy
Vadodara’s Industrial Growth Vadodara City runs through the golden corridor, from Ahmedabad to Vapi, and is one of India’s foremost industrial centres with dominant groups of chemicals and pharmaceuticals, cotton textiles and machine tools. The city witnessed a sudden spurt in industrial activity with the establishment of the Gujarat refinery in 1962. Various large-scale industries such as Gujarat State Fertilizers and Chemicals (GSFC), Indian Petrochemicals Corporation Limited (IPCL) and Gujarat Alkalis and Chemicals Limited (GACL) have come up in the vicinity of the Gujarat Refinery. The establishment of large industrial units in this region has automatically brought into existence a number of smaller enterprises. Several factors like raw material availability, product demand, and skilful mobilisation of human, financial and material resources by the government and private entrepreneurs had contributed to Vadodara’s efflorescence as one of India’s foremost industrial centres. But, with increased competition in the global market and failures to cope with the economic momentum, Vadodara’s economy has slowed down.
Indicators showing a decline in Industrial Growth As discussed, the city has been declining in terms of its economic growth. The drop in growth rates can substantiate this. At the same time, there are other reasons for this decline, which are further elucidated below:
The Gujarat Industrial Development Corporation (GIDC) industrial estate was set up at Makarpura in 1970 and has currently around 2000 operational industries. This estate lies within the municipal limits of the city. However, about 40% of these industrial undertakings have closed down in the last decade. The reasons have been poor infrastructure support, ageing workforce, pressure of local taxation, lack of skilled manpower and the lack of entrepreneurship required in the wake of the globalisation of the Indian economy. Local taxation is the biggest factor forcing industrial establishments to move outside the VMC limits.
These industries have selected new destinations close to the city so that they could still enjoy the benefits of city services. The work participation rate of Vadodara in 2001 was 32% as against 38% of Surat. This indicates that Vadodara city has a low workforce ratio, which may be due to the slack in the economic growth of the city in the last decade
Read more about this topic: Vadodara District
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