Mostly known outside India for its tourist attractions, Rajasthan has set in motion ambitious plans to diversify its economy and become a renewable energy powerhouse. Shri Bhajanlal Sharma, chief minister of Rajasthan, tells fDi Intelligence his government plans to double the Indian state’s gross domestic product (GDP). 

Q: What should potential investors in Rajasthan know about the state?

A: The government has set a target of doubling the state’s GDP over the next five years and making Rajasthan a $350bn economy. The state offers potential in areas such as solar and wind energy; agro-processing; automotives; electronics system design and manufacturing; textiles; and sustainable tourism. It is also the leading Indian producer of onshore crude oil, oil seeds, cumin, pulses and milk.

Q: Where are the new opportunities in renewable energy and sustainable development?

A: Rajasthan plans to increase its renewable energy capacity from the current 28 gigawatts (GW) to 115GW by 2031/32 and this requires investment of more than 5.4tn rupees ($64bn), which will provide opportunities for players in the renewable energy sector. The state is home to one of the world’s largest solar parks, located in Jodhpur, with a capacity of 2245 megawatts. It receives the highest amount of solar radiation in the country, with more than 320 days of sunshine annually. The state also leads India in terms of installed solar generation capacity and is ranked first for its estimated renewable energy potential by the Ministry of Statistics and Programme Implementation. It also produces a fifth of the nation’s wind energy.

As the largest state in terms of area, it has abundant parcels of land — essential for the establishment of renewable energy units. It has immense potential in areas such as solar power generation, solar parks, green hydrogen production and solar-wind hybrid projects.

Q: How is Rajasthan encouraging investment in innovation and technology? 

A: The government has initiated major projects across multiple sectors to promote innovation and technology in the state. These include a medtech park in Jodhpur and a fintech park in Jaipur. These large-scale projects are expected to create a domino effect in allied sectors and encourage private investment.

Rajasthan is home to several top-tier educational institutions, including the Indian Institute of Technology; the Indian Institute of Information Technology; the Birla Institute of Technology and Science, Pilani; and the All India Institute of Medical Sciences. These help to provide a skilled workforce as well as supporting links between industry and academia.

Q: How does Rajasthan compare with other markets in the Indian sub-continent in terms of opportunities and ease of doing business?

A: All Indian states are making giant strides towards improving the ease of doing business and ensuring that they are economically competitive.

Fiscally, we have identified several focus sectors under the Rajasthan Investment Promotion Scheme (RIPS) [a programme of incentives to promote economic growth and employment generation] — the latest version of which has been recently approved by the cabinet and was launched in October 2024. 

RIPS 2024 aims to attract investment in new emerging sectors for the micro, small and medium-sized enterprises sector, prioritising green growth, export promotion and capacity development. The list of new emerging sectors has been expanded and includes aerospace, defence, drones, semiconductors, agritech and waste recycling.

Do you want more FDI stories delivered directly to your inbox? Subscribe to our newsletters.

This article first appeared in the December 2024/January 2025 print edition of fDi Intelligence