The Asian Development Bank (ADB) has approved $631 million in loans and grants to develop the first key 800-km section of a planned 2,500-km-long East Coast Economic Corridor that will spur development on India's eastern coast and create seamless trade links with other parts of South and Southeast Asia.
The Visakhapatnam-Chennai Industrial Corridor section of the East Coast Economic Corridor, connecting four economic hubs and nine industrial clusters, will mark the first industrial corridor developed along India's coast. The East Coast Economic Corridor will ultimately extend from Kolkata in West Bengal in the northeast of India to Tuticorin in Tamil Nadu near the southern-most point of the country.
"By combining state-of-the-art industrial clusters, efficient transport, and reliable water and power supplies with a skilled workforce and good business policies, we expect the Visakhapatnam-Chennai industrial corridor to become a favored investment destination," said Manoj Sharma, Principal Urban Development Specialist, in ADB's South Asia Department. "We estimate that by 2025, annual industrial output along the corridor will increase fourfold to $64 billion from about $16 billion in 2015 if investment opportunities are maximized over the coming 10 years."
The Indian government is keen to encourage manufacturing, including through its ‘Make in India' initiative, to maintain strong economic growth over the longer term and to create productive, well-paying jobs for a labour force that is growing by around 12 million people per year. Currently, manufacturing provides around 15% of India's gross domestic product (GDP) and around 12% in Andhra Pradesh where the new corridor will be developed. India's National Manufacturing Policy is targeting manufacturing contributing at least 25% of GDP by 2022, much the same as in the People's Republic of China, Malaysia, and Viet Nam now.
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