VISAKHAPATNAM-CHENNAI INDUSTRIAL CORRIDOR (VCIC) DEVELOPMENT PROGRAM
FAST FACTS
1.
Economic or industrial corridors aim to connect cities and industrial zones to domestic
and global markets though high-quality transport networks. Good quality infrastructure
and policy frameworks are key.
2.
Building industrial corridors is central to India’s Act East policy to integrate the Indian
economy with Asia’s production networks and the Make in India initiative to encourage
manufacturing investment. India also aims to double its exports to $900 billion annually
by fiscal year 2019-2020.
3.
As well as the East Coast Economic Corridor, India is planning 4 other economic
corridors: Delhi-Mumbai Industrial Corridor, Chennai-Bengaluru Industrial Corridor,
Bengaluru-Mumbai Economic Corridor, and the Amritsar-Kolkata Industrial Corridor.
4.
Andhra Pradesh is India’s 10th most populous state with 49.4 million people.
Manufacturing contributes 12% of the state’s GDP, below the national average of 15%.
The poverty rate is estimated at 13.7%.
5.
The VCIC will encompass four main centers in Andhra Pradesh – Visakhapatnam (or
Vizag) the state’s largest city, with access to the eastern and central parts of India;
Kakinada, Amaravati, and Yerpedu-Srikalahasti at the Southern end of the corridor.
6.
Industries that will benefit include those already in the VCIC such as textiles and
apparel, “sunrise” industries such as electronics, and new industries attracted to the
area.
7.
Connecting to new markets will help India connect to global value chains. Parts and
components comprised nearly 70% of total manufacturing exports from East Asia in
1991-2011. But only 22% for India.
8.
The $245 million Tranche 1 of the $500 million Multi-tranche Financing Facility will focus
mainly on infrastructure in the cities of Visakhapatnam and Yerpedu-Srikalahasti – two of
the four business centers in the VCIC and also among the 100 cities designated by the
government to be developed as smart cities. The $255 million Tranche 2 of the $500
million Multitranche Financing Facility will finance projects in all four industrial centers. It
is scheduled to be approved by ADB in 2018.
9.
The $125 million, 15-year Policy-Based Loan will be divided into 2 tranches of $62.5
million each. It will focus on policy reform and institutional development in Andhra
Pradesh.
10.
The VCIC project is expected to be completed by end 2031.