Art Amp Craft Village

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1. Detailed Project Report

PROJECT REPORT
GOVERNMENT OF KARNATAKA
INITIATIVE
DEVELOPMENT OF ART & CRAFT VILLAGE
IN BANGALORE


TOURISM PROJECTS FOR INVESTMENT
OPPORTUNITIES
INVEST KARNATAKA 2016

January 2016

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Table of contents
1. Introduction ....................................................................................................... 3
1.1 Background .............................................................................................................................. 3
1.2 Objectives ................................................................................................................................ 3
1.3 Approach and Methodology .................................................................................................... 4
2. Overview.............................................................................................................. 5
2.1 Karnataka ................................................................................................................................. 5
2.2 Bangalore ................................................................................................................................. 6
2.3 Advantages of Bangalore ........................................................................................................ 8
2.4 Regional Connectivity .............................................................................................................. 8
2.5 Infrastructure Initiative ............................................................................................................ 9
3. Overview of Art & Craft in karnataka ...................................................... 10
3.1 Industry Overview .................................................................................................................. 10
4. Project Concept ............................................................................................... 18
4.1 What is art art and craft village ............................................................................................. 18
4.2 Project Component ................................................................................................................ 19
4.3 Project Drivers ....................................................................................................................... 20
5. Project Financial Viability Analysis ......................................................... 21
5.1 Project Cost ............................................................................................................................ 21
5.2 Estimation of Revenues ......................................................................................................... 22
5.3 Estimation of Expenses .......................................................................................................... 24
6. Project Implementation Structure ........................................................... 27
6.1 Review of different PPP Frameworks .................................................................................... 27
6.2 Implementation Structure ..................................................................................................... 28
6.3 Risks assessment .................................................................................................................... 29
6.4 Recommendation .................................................................................................................. 30
6.5 Project Layout ........................................................................................................................ 31
7. Recommendations and Way Forward ..................................................... 32
Annexures ................................................................................................................ 33

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1. Introduction
1.1 Background
Department of Tourism (DoT) Government of Karnataka (GoK) is determined to boost
the tourism industry in the state. The Tourism Sector has been identified as one of the
key sectors propelling the country’s economic growth. Karnataka State has been
ranked as the 3
rd
preferred destination among domestic tourists in the tourism sector.
Karnataka’s thriving economy has created many opportunities across the State in the
last decade.
For GoK, the tourism sector constitutes a real priority because it is an important sector
for the generation of employment, therefore various initiatives are been undertaken
with the involvement of all stakeholders, both public and private, that will foster a
more favourable environment for the development and consolidation of the tourism
sector. One of the initiatives in this direction is the formulation of Karnataka Tourism
Policy for 2015-20.
GoK intends to encourage the investors to invest in the tourism sector. A host of
incentives and concessions are provided to the investors in tourism sector, in the New
Tourism Policy for 2015-20. A large emphasize has been laid on enhancing hospitality
services and standards, promoting innovative developments and rejuvenation of older
tourist attractions, with the aim of offering visitors the experience that will
commensurate with higher expectations.
With this background, DoT has prepared a shelf of Project Reports of potential tourism
projects which could be undertaken for development along with collaboration with the
Private sector. Development of Art & Craft Village in Bangalore is one of the projects
identified for development. The idea is to showcase culture of Karnataka in Bangalore
through establishing an art & craft village in the capital of the state. Department of
Tourism, Government of Karnataka intends to develop an in Bangalore, the state
capital to showcase the talent of the local artists.
1.2 Objectives
GoK intends to develop the art and craft village in Bangalore, Karnataka to:

i. Create a wholesome experience for the tourists through providing them a
feeling of vernacular culture of the state.
ii. Promote the rich ethnic inheritance of the city and develop Bangalore as a hub
of Kannada art and craft activity.

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iii. Create a space and environment to preserve the traditional art and craft of the
state for the tourists.
iv. Attract more footfalls, encourage extended stays.
v. Promote the talents of local artists, artisans and craftsmen though giving them a
platform to exhibit their painting, art – work and piece of craft via exhibition,
studio, open air theatres and stalls.
vi. Encourage entrepreneurship and livelihood opportunities for the locals.
vii. Encourage and promote Private Sector Participation in the development of
tourism sector.
Department of Tourism, Government of Karnataka, the agency promoting tourism in
Karnataka has been at the forefront in attracting large number of tourists to the state
and branding Karnataka as a tourist destination. Developing a centre promoting the
local art, craft and culture would add a feather to this initiative.
1.3 Approach and Methodology
The Approach to the entire assignment is depicted in the flow chart below. The
detailed analysis and inferences drawn at each stage have been covered in detail in
the each of the following sections.

Figure 1: Approach to the project


•Study of art and
craft industries
•Review the
policies related
to art and craft
Secondary
Research
•Identify projects to be
developed
•Determine the costs,
revenue streams, other
expenses and assess
projet viability
Financial
Feasibility
•Identify probable
projects and its
locations
•Suggest project
structure options
for development
Implementation
Structures

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2. Overview
2.1 Karnataka
Karnataka State comprises of 30 districts and has been classified into four divisions
namely Bangalore, Belgaum, Gulbarga and Mysore Divisions. Karnataka has vibrant
automobile, agro, aerospace, textile & garment, biotech and heavy engineering
industries. The state has sector-specific SEZs for key industries such as IT,
biotechnology, engineering, food processing and aerospace.
Karnataka is the IT hub of India and home to the fourth largest technology cluster in
the world. As of 2014-15, total exports from the state aggregated US$ 52.02 billion,
which is approximately 13.01 per cent of India's total exports. Karnataka has 47 IT/ITeS
SEZs, three software technology villages and dedicated IT investment regions.
Karnataka boasts of a diverse flora and fauna and a 320 km natural coast line, which
makes it a nature tourist's paradise. Tourist arrivals in the state increased from 25.2
million in 2005-06 to 111.8 million in 2014-15.

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2.2 Bangalore
Bangalore, the capital city and the largest city of Karnataka State is popularly known as
the ‘Silicon Valley of India’ and has come to be one of Asia’s fastest growing cities since
emergence of the IT-ITeS industry. Karnataka itself is globally known for its vibrant
economy and investment potential.
Being a major industrial and commercial center of the country, Bangalore is also the
nerve center of India’s software industry and is well connected domestically and
internationally, thus attracting people from all over the country and beyond for
meetings, seminars, conferences and exhibitions. It is home to some of the most high
tech industries, IT organizations and some of India’s premier scientific establishments.
Bangalore is one of the most ethnically diverse cities in the country, with over 62% of
the city's population comprising migrants from other parts of India. Historically a
multicultural city, Bangalore has experienced a dramatic social and cultural change
with the advent of the liberalization and expansion of the information technology and
business process outsourcing industries in India. IT companies in Bangalore employ
over 35% of India's pool of 1 million IT professionals.

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Table 1: Overview of Bangalore City
Aspect Details
City Bangalore
Population (2011 Census) 8.52 Million
Area  Municipal Area (BBMP): 741 sq. km
 Planning Area (Bangalore Development Authority): 1,307
sq. km
 Development Area (Bangalore Metropolitan Regional
Development Authority): 2,190 sq. km
Geographic Location  77
0
37’ E Longitude and 12
0
8’ N Latitude.
 Elevation: 920 m above the mean sea level.
Connectivity and Linkages  Air: The city has an international airport with regular
flights from & to important destinations both in India and
abroad. Bangalore International Airport started its
operations of Phase 1 in April 2008.
 Road: The city is strategically located on NH-4 (Chennai-
Bangalore-Pune), NH-7 (Bangalore-Hyderabad), NH-48
(Mangalore), NH 207 (Chikaballapur), & NH-209
(Coimbatore) and State Highways to other cities in the
State.
 Rail: The city has three railway stations, viz. Central,
Cantonment and Yeshwantpur. The city is well connected
to all major Indian cities by rail network.
Climate  Tropical climate
 March to May (warmest months)
 December to February (coldest months)
 July to September (rainy - southwest monsoon)
 November to December (rainy - northeast monsoon)
Temperature  Highest maximum temperature of 33
o
C
 Lowest minimum temperature of 14
o
C
Languages  Regional language: Kannada
 English, Hindi, Telugu and Tamil are widely spoken and
understood.
City Administrator Greater Bangalore Municipal Corporation (Bruhat Bangalore
Mahanagar Palike)

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Aspect Details
City Functions Administrative Capital, IT capital of the country
Distance of International
Airport from CBD
35.0 km
Source: Jones Lang LaSalle Report
Apart from the industrial importance, Bangalore city also has few other characteristics
such as a cosmopolitan culture, higher spending capacity, large percentage of young
population and existence of International airport all of which together promote
Bangalore as an idyllic place to develop entertainment and amusement villages.
Developing a art and craft village will be very constructive to attract more domestic
and international tourists in the city and will also act as a weekend destination for the
city – dwellers.
2.3 Advantages of Bangalore
Following are the advantages of developing art and craft village in Bangalore:
 Rich tangible heritage of famous handicrafts such as stone carving, wood
carving, ivory and sandlewood craft.
 Exclusive art of Mysore painting, bridal wear and silk wearing.
 Availability of world class skilled manpower
 Location advantage - good connectivity and linkages
 Salubrious climate
 Reform oriented governance
 Cosmopolitan culture
 Excellent social, education & health facilities
 Telecom connectivity
 Presence of multinational companies
2.4 Regional Connectivity
Bangalore city is well – connected via Air, Rail and Road way. Bangalore city railway
station and Yeshwantpur Railway Station are the main railway stations serving the city
– dwellers, connecting the city with the rest of the country. Bangalore comes under
the South – Western Railways section of the Indian Railways. Bangalore is vey well –
connected to all major global destinations via air transport services. The city has an

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international airport with regular flights from & to important destinations both in
India and abroad. BIA started its operations of Phase 1 in May 2008.
Presently the State owned run buses as well as private tour operators also run buses
and luxury buses to all parts of the city and connecting Bangalore to other cities like
Bijapur, Hubli, Dharwad and Belgaum. The main bus depots are Kempegowda Bus
Station, Shantinagar Bus Depot and Shivajinagar Bus Depot. The NICE ring road which
is intended to connect Bangalore with Mysore, is also connecting the city with other
major towns namely Srirangapattana, Pandavapura, Mandya, Maddur,
Channapattana, Ramanagara, Kengeri etc. As mentioned earlier, the city is
strategically located on NH-4 (Chennai-Bangalore-Pune), NH-7 (Bangalore-Hyderabad)
and NH-48 (Mangalore). Many state highways connect the State Capital City to other
cities in the State.
Considering the inflow of tourist population in Karnataka and especially in Bangalore,
developing an with high socio-economic value will attract high revenue.
2.5 Infrastructure Initiative
There are various proactive measures taken up by the GoK in augmenting & expanding
the region in terms of physical infrastructure and developing major infrastructure
projects to encourage overall economic development.
The under – construction NICE road is 111 km long and connects two important cities
of Karnataka i.e, Bangalore and Mysore, touching various cross sections of state and
national highways. The NICE road is expected to impact the city connectivity scenario
majorly as it connects Electronics City, Bannerghatta Road, Magadi Road, Madiwala
and other strategic locations. The Bangalore – Mysore Infrastructure Corridor is also
getting developed along NICE and is expected to bring in various commercial and
tourism zones along it.
One of the largest infrastructure projects which will be witnessed by Bangalore city –
dwellers in the upcoming years is completion of construction of Bangalore Metro and
LRT Project. This is another project which is expected to impact the city transportation
majorly. Apart from these, widening of Sarjapur Outer Ring Road connecting it to the
peripherial ring road and several elevated expressway at various junctions of the city
will definitely improve the connectivity further.
The completion of the above mentioned projects will have significant impact on the
regional and economic development of the region as well as it will induce more no. of
tourist population.

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3. Overview of Art & Craft in karnataka
Karnataka is a land steeped in art and history. Its ancient sculptures and temple
carvings stand testimony to its rich cultural heritage, which has captivated kings and
commoners alike since time immemorial.
The vast range of the State’s arts and crafts that now embellish royal homes of the
past, elite bungalows, and even ordinary hutments, bear testimony to the skill,
aesthetic sensibilities, and decorative abilities of the craftsperson. Many craft
traditions in Karnataka have been handed down from father to son and this continuity
has helped to support a vast variety of handicrafts with their high degrees of
perfection.
The State’s craftsmen received much patronage from the royalty in the past. Today,
the government has set up many agencies and design centres to encourage craft
families to continue making handicrafts and also help them to market their ware. This
has helped keep many craft traditions alive so that their practitioners can cater not
only to the local population but also to the many tourists who visit Karnataka.
Though home to the famous Nritya Gram, a center for dance and martial art forms, the
city, also known as India’s garden city lacks an cultural and ethnic focal point which
could bring together craftsmen, artisans and performers to mirror the rich heritage of
the state as well as its role in the cultural tapestry of the country.
Bangalore, the capital of the state of Karnataka boasts of a vibrant culture. Being a
major industrial and commercial centre of the country, Bangalore is also the nerve
centre of India’s software industry, thus attracting people from all over the country
and beyond for meetings, seminars, conferences and exhibitions.
3.1 Industry Overview
Karnataka has a rich tradition of exquisite craftsmanship. Major crafts practiced are
Gudigar works (made of sandal wood and rose wood), inlay work and carvings, bronze
statues, lacquerware toys from Channapattana and Kinhal, Bidriware, batiks and home
decor products.
Handicrafts are made in cottage industries by local artisans of the region, as a means
of livelihood. They are often manufactured and sold in local markets and sometimes
are also sold to the Corporation/ private retails for organized sales.
Karnataka State Handicrafts Development Corporation Ltd (KSHDC), was established
by Government of Karnataka in 1964 with the objective of preserving and nurturing

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the handicrafts of the State and provide assistance in improving the economic
conditions of the artisans. The Corporation has been promoting handicrafts of the
state through a number of retail outlets popularised by the name of 'Cauvery'. All over
India, the Karnataka State Arts & Crafts Emporium, 'Cauvery', has acquired a unique
brand image for its products which is synonymous with highest quality at competitive
prices.
Craftsmen endowed with high skill levels entirely devoted to producing quality
handicrafts are part of 13 craft complexes spread across the State which provide
facilities in terms of raw materials, living cum work-sheds, common facilities centre,
design input and marketing support. The craft complexes located in Karnataka
established by KSHDC are listed below:
a. Sandal wood craft complex, Sagar
b. Sandalwood craft complex, Sirsi
c. Sandalwood craft complex, Soraba
d. Sandalwood craft complex, Kumta
e. Multi craft complex, Mysore
f. Lacquerware craft complex, Channapatna
g. Bidriware craft complex, Bidar
h. Cotton Dhurries complex, Navalgund
i. Pile carpet centre, Mundgod
j. Pottery craft complex, Ramanagar
k. Kinhal Procurement Centre, Kinhal
l. Bronze craft complex, Bangalore
m. Stone craft complex, Shivarapatna
3.2 Regional Profile – Major Handicraft Industries In Karnataka
Handicrafts made in Karnataka are widely sold not just in India but also in other parts
of the world. The regional spread of handicrafts in the State, the manner in which
they are made and their history is discussed in this section.
3.2.1 Channapattana- Lacquerware Toys
Channapatna, famous for Lacquer ware toys is located at a distance of 50 km from
Bangalore. Channapattana toys are a particular form of wooden toys (and dolls) that
are manufactured in the town of Channapatna in the Ramanagar district of Karnataka.
This traditional craft is protected as a geographical indication under the World Trade
Organization, administered by the Government of Karnataka. As a result of the
popularity of these toys, Channapatna is known as Gombegala Ooru (which means
“Toy town”) of Karnataka. Traditionally, the work involved lacquering the wood of the
Wrightia tinctoria tree, colloquially called Aale mara (ivory-wood).

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The origin of these toys can be traced to the reign
of Tipu Sultan who invited artisans from Persia to
train the local artisans in the making of wooden
toys. For nearly two centuries, ivory-wood was the
main wood used in the making of these toys,
though rosewood, sandalwood, rubber, sycamore,
cedar, pine and teak were also occasionally used.
Manufacturing stages include procuring the wood,
seasoning the wood, cutting the wood into the
desired shapes, pruning and carving the toys,
applying the colours and finally polishing the
finished product. Vegetable dyes are used in the
colouring process to ensure that the toys and dolls
are safe for use by children.
As of Oct 2006, more than 6,000 people in Channapatna, working in 254 home
manufacturing units and 50 small factories, were engaged in
the making of these toys. The Karnataka Handicrafts
Development Corporation (KHDC) provides assistance with
marketing efforts. The raw-material used are halewood, Lac,
Lithophon and varieties of colour. With no proper backing or
marketing, the Channapatna toy industry faced a financial
crunch for more than a decade and was almost on the verge of
dying out. However, with the help of KHDC, the craft has been
revived and the artisans involved are being trained on changing trends in the industry,
to help them keep abreast of the current scenario. Prototypes designed by master
craftsmen are introduced to the local artisans, who use them to create well-designed
toys and dolls.
The Government of Karnataka has also provided help by constructing a Lacquerware
Craft Complex, which has a manufacturing centre with 32 turning lathe machines, at
Channapatna. Financial assistance to the artisans, with help from the Dutch
Government and the Karnataka Government's Vishwa scheme has also been provided.
Annual export of Lacquerware toys is to the extent of Rs. 5 Crores.
3.2.2 Bidar – Silver Inlay Works/ Bidriware
Bidriware is a metal handicraft that originated in Bidar, Karnataka, in the 14th century,
during the rule of the Bahamani Sultans. The term 'Bidriware' originates from the
township of Bidar, which is still the only town that manufactures the unique
metalware. Due to its striking inlay artwork, Bidriware is an important export

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handicraft of India and is prized as a symbol of wealth. The metal used is a blackened
alloy of zinc and copper inlaid with thin sheets of pure silver.
The origin of Bidriware is usually attributed to the Bahamani sultans who ruled Bidar in
the 13th –15th centuries. Abdullah bin Kaiser, a craftsman from Iran was invited by the
Sultan to work on decorating the royal palaces and courts. According to some
accounts, Kaiser joined hands with local craftsmen and gave birth to Bidriware. Since
then, the craft has been handed down succeeding generations mostly among the local
Muslim and Lingayat sects.
Bidriware is manufactured from an alloy of copper and zinc (in the ratio 1:16) by
casting. The zinc content gives the alloy a deep black color. First, a mould is formed
from soil made malleable by the addition of castor oil and resin. The molten metal is
then poured into it to obtain a cast piece which is later smoothened by filing. The
casting is now coated with a strong solution of copper sulphate to obtain a temporary
black coating over which designs are etched freehand with the help of a metal stylus.
This is then secured in a vise and the craftsman uses
small chisels to engrave the design over the freehand
etching. Fine wire or flattened strips of pure silver are
then carefully hammered into these grooves. The
article then is filed, buffed and smoothed to get rid of
the temporary black coating. This results in rendering
the silver inlay hardly distinguishable from the
gleaming metallic surface which is now all silvery
white.
The Bidriware is then prone to the final blackening process. Here, a special variety of
soil which is available only in the unlit portions of the Bidar fort is used. It is mixed with
ammonium chloride and water to produce a paste which is then rubbed onto a heated
bidri surface. The paste selectively darkens the body while it has no effect on the silver
inlay. The paste is then rinsed off to reveal a shiny silver design resplendent against
the black surface. As a finishing touch, oil is applied to the finished product to deepen
the matt coating. The finished product appears black with brilliant silver inlay.
The Bidri designs are usually patterns such as the Asharfi-ki-booti, stars, vine creepers
and stylized poppy plants with flowers. Traditional designs include the Persian Rose
and passages from the Quran in Arabic script.
While Bidar in Karnataka and Hyderabad in Andhra Pradesh are the most vibrant
centers, this art is also practiced in few other parts of the country like Purnia in Bihar,

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Lucknow in Uttar Pradesh and Murshidabad in West
Bengal. The designs are mostly conventional ranging from
creepers, flowers and sometimes human figures.
3.2.3 Shimoga- Sandalwood Works
Sagara in Shimoga district of Karnataka is known for the
Gudigar works. The name Gudigar is derived after the clan
which is well versed in making such handicrafts. Gudigars
are families that for generations have been engaged in
sandalwood and ivory carving. They are trained in the craft
since childhood. While the Gudigar men make idols,
figurines and knick-knacks like penholders, agarbathi stands, cuff links, photo frames
and paper clips, the women are adept at making garlands and wreaths out of thin
layers of scraped sandalwood.
The Gudigars make some of the most exquisite pieces using simple tools like knives,
screwdrivers, hand drills and saws. They work in the verandahs of their houses. The
Karnataka Government ensures that they are given a regular supply of the wood. The
items they make are sold in Government Emporia and through licensed private
dealers.
3.2.4 Mysore - Wooden Inlay Work
Mysore is well known for the wooden and ivory in laid handicrafts. Craftsmen in the
city of Mysore have specialized in wood inlay work making exquisite articles depicting
landscapes, pastoral scenes, elephant herds, birds etc. Some of the finest examples of
the elaborate inlay work done by master artisans can be seen in the Maharaja’s palace
in Mysore and in the mausoleum of Tipu Sultan in Srirangapattna.
Ivory carving is another popular craft prevailing in the entire State. Articles carved
delicately without excessively ornate image adjoining the figures, mostly showcasing
the figures of god and goddess. Some of Mysore's masterpieces in ivory are now
preserved in the Heritage Museum in Russia and in the South Kensington Museum,
London.
However, in recent years, because
of the ban imposed on the ivory
trade, the craft has received a
setback. However, such articles are
still found where it is carved very
intricately without floral tracery
surrounding the figures, mostly of

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Gods with Krishna being featured in several aspects.
Mysore Paintings
Mysore painting is an important form of classical South
Indian painting that originated in the town of Mysore in
Karnataka. These paintings are known for their elegance,
muted colours, and attention to detail. The themes for most
of these paintings are Hindu Gods, Goddesses and scenes from Hindu mythology. In
modern times, these paintings have become a much sought after souvenir during
festive occasions in South India.
The process of making a Mysore painting involves many stages. The first stage is the
making of the preliminary sketch of the image on the base. The base consists of
cartridge paper pasted on a wooden base. A paste made of zinc oxide and Arabic gum
is made called "gesso paste". With the help of a thin brush all the jewellery and parts
of throne or the arch which have some relief are painted to give a slightly raised effect
of carving. This is allowed to dry. Thin gold foil is then pasted onto the surface. The
rest of the piece is then painted using watercolors. Only muted colors are used.
3.2.5 KOPPAL - KINHAL TOYS
Kinhal has an immensely rich artistic heritage. It was once a flourishing centre for
crafts, the most well-known being exquisite carvings in wood. The famous mural
paintings in the Pampapateshwara temple, and the intricate work on the wooden
chariot at Hampi, are said to be the work of the ancestors of the Kinhal artisans of
today. Old paper tracings found in the ancestral house of one of the artisans further
substantiates this belief.
Kinhal toys are well-known as the painted wooden toys from the Koppal district. The
local artisans called Chitraghars mainly produce palanquins and cradles, images of
deities including other idols kept around the temple, chariots. Craftsmen from Gokak
are known to make wooden toys that look very much like the real fruits and
vegetables for the children to play with which act as educative toys.
Lightweight wood is used for the toys. The paste used for joining the various parts is
made of tamarind seeds and pebbles. Jute rags, soaked, slivered into pieces, dried,
powdered, and mixed with saw dust and tamarind seed paste is made into kitta. A
mixture of pebble powder paste with liquid gum is used for embossing the
ornamentation and jewellery on the body of the figure. Once the components of the
figure are assembled, kitta is applied by hand all over, and small pieces of cotton are
stuck on it with the tamarind paste. Pebble paste, pebble paste which forms the base
for the application of paint is applied over it.

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Previously, toys depicting people involved in various
occupations were popular; now the preference is
for figures, animals, and birds. Garuda, the epic bird,
has 12 components while Lord Ganesha on a throne
has 22 components. The styling is realistic and the
designing and chiselling has a master touch. In the
festival season, clay toys and images are made, often out of cowdung and sawdust. In
2007, students from the University of Glasgow took part in a project with local
students and craftsmen, in an attempt to revive the Kinhal craft.
It is believed that the art of Kinhal painted woodenware, dates to the Vijayanagara
Empire, founded around 1500 A.D. The craft flourished due to the patronage of the
Vijayanagara rulers in whose reign many of the fine arts reached their aesthetic zenith.
The Kinhal style is a part of the painting and sculpture styles of that era, according to
art historians. After the fall of the empire, the craft received support from the Nawab
of Koppal, Desais of Kinhal and more importantly, Nawab Salar Jung of Hyderabad,
who also patronised the lacquered woodcraft. The interface between these forms and
the common patronage led to a mellow blend of Hindu and Islamic art forms that is a
signature feature of the Kinhal craft.
3.2.6 BELLARY - LAMBANI EMBROIDERY
The Lambani embroidery is an amalgam of pattern darning, mirror work, cross stitch,
and overlaid and quilting stitches with borders of “Kangura” patchwork applique, done
on loosely woven dark blue or red handloom base fabric. The distinctiveness of the
handicraft lie in its distinctive design range, use of local mud-resist handloom fabric,
mirrors, shells and white ornamental trims (that are a traditional part of Lambani as
well as the Ilkal sarees of Dharwad-Hubli and other local fabrics).
Sandur’s best-known line is Lambani embroidery, which is done by Lambani or Banjara
women. These communities, settled in the Sandur area, are originally said to have
come from Marwar.
The women continue to wear their striking traditional costumes. These are adorned
with a distinctive bold embroidery that makes use of mirrors and also other
embellishments such as shells and
buttons. Sandur combines
contemporary design with the skills
of the Lambani women to put
together products that suit urban
tastes. The Sandur Kendra is a place
that the Lambani women can come

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to work at. They are paid on piece rate basis, and also receive Provident Fund, bonus
and subsidized ration benefits.
3.2.7 OTHERS - BRONZE CRAFTS, CANE, COIR
Bronze craft is mainly pursued at Bangalore, Nagamangala, Udupi, Shivarpatna,
Mysore, Belgaum and Hubli. The raw materials used are of Copper and Brass. The
motifs are taken from temple friezes, images of Gods like Ardhnarishwara, Nataraja,
Buddha, Krishna, Deppalakshmi, etc. The motifs are cast in the mould prepared by
craftsmen, then carved meticulously and polished to give a fine finish.
Artisans also produce other items like Ganapthi and Ganapathi Nandi miniature
images. The concept for the art work is derived from the South Indian temples. The
bronze craft is also utilized in making brass and copper utensils, door handles, bowls,
vases, idols for temples, and other figurines in the temples. KSHDC conducts craft
exposure study tours to visit places like Dakshina Kannada, Mysore, Shivarpatna,
Bellary, Hospet (Hampi), Badami, Ajantha, Ellora, Belur, Halebeedu, Shravanabelagola,
etc. to view the most exquisite monuments so that they derive ideas/ designs for
bronze craft.
Metal works in Karnataka is not confined to any particular area or city. While some
regions are famous for bronze casting, others are known for bell metal works. Metal
work industry is significantly practiced in the State as numerous families are involved
actively in it. Many articles for religious purposes are made of metal. Karkala, famous
for Jain statues and Udupi are the major centers for such works. Mangalore is famous
for the bell metal works and Nagamangala is famous for bronze casting. Most
attractive pieces of bronze work are the human figures made out of it. Other
handicrafts include handicrafts made of coir, cane and banana plantain.

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4. Project Concept

Travel and tourism, the world’s largest industry, is a key driver of economic growth.
Given this background the development of appropriate infrastructure facilities for
promoting tourism would go a long way in developing the state’s economy. This
Section discusses the concept of establishment of art and craft village in Bangalore.
4.1 What is art art and craft village
The village was conceived with an idea to create an environment for the preservation
of traditional crafts. It aims at providing encouragement to the needy artists from all
over the state in order to sustain and preserve the rich heritage of karnataka.
The village is a tribute to karnataka’s natural beauty, richly diverse cultural heritage
and vibrant ethos. It is a place where artisans from across karnataka showcase their
individual skills in a variety of arts, crafts
and culture. From pottery to a plethora of
weaves, woodwork, jewelry, clothes and
local crafts of each region of the state, this
village is a kaleidoscope of karnataka’s
colour, diversity and talent.
The village focuses on creating a tourist
destination, centered on hands-on
interaction between tourists and artisans, who create, display and market their crafts
on site. The strategy being, to make Karnataka's traditional crafts an integral part of
the tourism experience while also providing sustainable development for the artisans
economically.

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4.2 Project Component
Based on the review of similar art and craft villages in India and abroad, the following
components are suggested at respective locations.
The Project could be developed on a land parcel of approximately 2 acres. The facilities
proposed to be developed are detailed out in the table below:
Sl. No Facility Components
1. Art and craft village Would comprise:
 15 huts
 Each hut is of 1300 sq.ft
2. Food court Easily accessible from the Art and craft village, the food court
should have sufficient capacity to manage the number of
visitors.
3. Retail Area Would include retail stores for selling other traditional items
etc.
4. Accomodation Providing staying facilities in the village
5. Ampi theater Open air theater for conducting traditional folk art & dances
of Karnataka.
6. Other Infrastructure Providing facilities like Parking, Toilets etc.
To make the project financially viable for a private developer / operator, in addition to
the Art and craft village, food court, theater which showcases the various dances
forms of Karnataka.
Components Indicative size / area
Art and craft village 20,000 sq.ft
Food Court 6,000 sq.ft
Retail 20,000 sq.ft
Accomodation 10,000 sq.ft
Ampi theater 5,000 sq.ft
Other Facilities 10,000 sq.ft

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4.3 Project Drivers
The following issues are critical in ensuring the implementation and success of the
Project:
i. Land
The minimum land requirement for the Project would be 2 acres. Availability of land is
critical for commencing the Project development activities.
ii. Location
Location of the Project and its proximity to the city is a key factor for driving footfalls
to the village. A potential site with proper connectivity, closer to the city centre needs
to be identified by DoT.
iii. Infrastructure
The physical infrastructure including roads, water supply, power, etc for the Project
site need to be in place for operationalising the Project facilities and is a key concern
for the private developer / operator as well as for the public intending to visit the
Project. DoT / GoK would need to plan for the basic infrastructure facilities at the
identified Project site prior to commencing the bid process for selection of the private
developer / operator.
iv. Facilities / components
The facilities offered by the Art and craft village would need to be carefully planned to
provide something of interest to all age groups. The success of the Project would
depend on the capability of the Village to attract visitors on a continual basis. This
would mean that new rides / products would need to be introduced periodically to
sustain the interest of the visitors to the Village. Attractive package offers, seasonal /
non-seasonal offerings and pricing would be important drivers for the success of the
Village.
v. Transportation
To facilitate commute of visitors to the Village, it may be required to provide
transportation facilities to and from the Project site at periodic intervals through the
day.

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5. Project Financial Viability Analysis
The financial viability assessment has been carried out for the Project.This Chapter
provides a summary of the Financial Viability of the project.
5.1 Project Cost
The base construction cost of the Project has been estimated at Rs. 3.61 Crores. The
details of the same are presented below.
Sl. No Item Area in sq.ft Total Cost (Rs. Crores)
1 Art and craft village 20,000 1.20
2 Food Court 6,000 0.30
3 Retail Area 20,000 1.00
4 Accomodation 10,000 1.00
5 Ampi Theater 5,000 0.01
6 Others 10,000 0.10
Total Base Cost 71,000 3.61
The base cost is as per estimations carried out for the current year i.e 2015.
Sl. No Item Amount (Rs. Crores)
1. Construction Cost 3.61
2. Contingency (4% of construction cost) 0.14
3. Preliminary expenses (1.5% of construction cost) 0.05
Thus, considering all components, the total project cost is estimated to be around
Rs. 3.80 Crores.

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5.2 Estimation of Revenues
The revenue income for each of the facilities in the Project has been estimated and
the details of the assumptions made therein are presented below.
i. Art and craft village (Hut)
Sl. No Description Value
1. Built-up area 20,000 sq.ft
2. Area rented 100% of built-up area
3. Rent per month for one hut (Rs.) 10,000
4. Lease per year for one hut (Rs.) 100,000
ii. Food Court
The number of visitors to the food court has been estimated to be the same as those visiting
the art and craft village. As the FEC and retail area proposed would also have a separate
food court, the footfalls in the FEC and retail area have not been considered to estimate the
revenue from the food court.
Sl. No Description Value
1. Built-up area 6,000 sq.ft
2. Area rented 100% of built-up area
3. Rent per month for one hut (Rs.) 50,000
4. Lease per year for one hut (Rs.) 500,000
iii. Retail Area
The assumptions for revenue from the retail area are provided in the table below:
Sl. No Description Value
1. Built-up area 20,000 sq.ft
2. Area rented 100% of built-up area
3. Rent (Rs./sq.ft/month) 30
4. Lease (Rs./sq.ft/year) 300

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iv. Accomodation
The assumptions for revenue from the accomodation are provided in the table
below:
Sl. No Description Value
1. Built-up area 10,000 sq.ft
2. Area rented 100% of built-up area
3. Rent (Rs./room/day) 500
4. O&M Charges (Rs./room/day) 150
v. Other revenues
The assumptions for other revenues are provided in the table below:
Sl. No Description Value
1. Entry fee for art and craft village (Rs. per person per day) 20(Adult)
10(Child)
2. Ampi Theater (Fee Per day in Rs.) 500

Price escalation for all the revenues is done by 1% year on year.

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5.3 Estimation of Expenses
The assumptions for Operations and Maintainence expenses are provided in the
table below:
Sl. No Description of O&M Expenses Value
1. Art and craft village (Hut) (Rs. Per Hut/year) 10,000
2. Food Court (Rs. Per Shop/year) 5000
3. Retail shops (Rs. Per Shop/year) 5000
4. Accomadation (Rs. Per Room/day) 150
5. Ampi Theater(Rs./day) 100

Sl. No Description of Other Expenses Value
1. Manpower Cost (Rs. Lakhs/year) 20
2. Power Cost (Rs. Lakhs /year) 10
3. Miscellaneous (Rs. Lakhs /year) 5
4. Marketing Expenses (Rs. Lakhs /year) 2

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Expected Project Revenues
Rs lakhs
Years 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Revenues



Hut - Lease

5

5

5

5

5

5

5

5

5

5

6

6

6

6

6
Hut - Rentals

12

12

12

12

12

13

13

13

13

13

13

13

14

14

14
Foot court - Lease

15

15

15

15

16

16

16

16

16

16

17

17

17

17

17
Foot court - Rentals

18

18

18

19

19

19

19

19

19

20

20

20

20

20

21
Retail shops - Lease

10

10

10

10

10

11

11

11

11

11

11

11

11

11

11
Retail shops - Rentals

36

36

37

37

37

38

38

39

39

39

40

40

41

41

41
Accomodation -
Rentals

15

15

15

15

16

16

16

16

16

16

17

17

17

17

17
OAT

1

1

1

1

1

1

1

1

1

1

1

1

1

1

1
Footfalls - Gate fee

13

13

13

13

14

14

14

14

14

14

14

15

15

15

15

Total Revenue

125

126

128

129

130

131

133

134

135

137

138

139

141

142

144

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Expected Project Expenses
Rs lakhs
Years 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Expenses

Manpower Cost

20

20

20

20

20

21

21

21

21

21

21

21

21

21

21
Power Cost

10

10

10

10

10

10

10

10

10

10

11

11

11

11

11
Maintainence Cost

8

8

8

8

8

8

8

8

8

8

8

8

8

8

8
Miscellaneous

5

5

5

5

5

5

5

5

5

5

5

5

5

5

5
Marketing Expenses

2

2

2

2

2

2

2

2

2

2

2

2

2

2

2

Total Expenses

45

45

45

45

46

46

46

46

47

47

47

47

47

48

48



Profit

80

81

82

83

85

86

87

88

89

90

91

92

93

95

96
Tax

28

28

29

29

30

30

30

31

31

31

32

32

33

33

34
Net Profit

52

53

54

54

55

56

56

57

58

58

59

60

61

61

62

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6. Project Implementation Structure
The mode of implementation of the Project could be through the Public Private
Participation (“PPP”).
This chapter sets out the salient features of the different structuring options for
undertaking the implementation of the project under a suitable PPP model and
recommendation on the most suitable structure.
6.1 Review of different PPP Frameworks
There are mainly three different frameworks for contracting work under the PPP
model as described below:
6.1.1 Service Contract:
A specific service (discrete and clearly defined) is contracted out by the public agency
to a private operator. Payment is usually on fee per package basis. Service contracts
are subject to frequent competition and usually last for shorter term like one year. It
is also common to give out separate contracts for different parts of the project to
more than one operator, thereby enabling comparative competition.
6.1.2 Management Contract:
Under this arrangement, the private sector assumes the responsibility for core
activities such as operations and maintenance of units in a specific geographical
sector (which could comprise the whole or only a part of the entire project) or at a
defined level of responsibility. Public entities legally remain the owners of the assets.
A private company may agree to take over the responsibility for managing a service
to specified standards but using the staff, equipment, vehicles and buildings of the
public entity. In such a situation the private company would bring in its
management expertise, however is unlikely to make major capital expenditure under
such a structure.
6.1.3 BOT/ Concession Contracts:
The private operator is responsible for financing new investment in entire project
over the life of the contract. The assets are owned by the public entity; however, the
private operator takes over responsibility of managing assets, creating new assets
where required, raising finance for the new investments, providing the service,
operations and maintenance, collection of charges, if applicable. This arrangement
could apply to a specific jurisdiction or geographical area. The private operator

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would pay an annual fee or may receive an annual subsidy depending on the
financial circumstances of the service. Such arrangements may apply in respect of
commercial operations owned by an authority where the user charge either covers
or represents a substantial proportion of the total cost.
6.1.4 Review of the requirements for different frameworks
Table 2: Requirements of different PPP frameworks
Framework Technical
Expertise
Managing
Expertise
Operating
Efficiency
Capital
Investment
O & M
Investment
Service Contract Yes No No No No
Management
Contract
Yes Yes Yes No No
Concession Yes Yes Yes Yes Yes

Based on the above available frameworks, the following structure has been analyzed
for undertaking the project:
6.2 Implementation Structure
The following would be the salient features of the implementation framework:
a. Handover of the Project site by DoT on execution of the Project Development
Agreement (PDA) to the developer (SPV formed for undertaking the project
under PPP model) along with the grant of development rights for development
of the project as per terms of the PDA.
b. The project would be developed by the developer wherein it would be
responsible for designing, financing, development, operation & maintenance
and transfer of the project at the end of the agreement period
c. Annual payments would be made by the developer to DoT against grant of the
development rights.
d. Project implementation would be monitored by a Project Engineer employed by
DoT for overlooking the day to day activities as well as overall performance of
the project
e. The developer would be allowed to levy and collect user charges from the users
of the project facilities
f. On expiry of the agreement period, the developer would hand back the project
site and facilities developed on ensuring that the quality and condition of all the
facilities developed are in good and working condition.

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The following diagram depicts the overall framework of the project execution:

Figure 2: Implementation Framework
6.3 Risks assessment
Under the above framework, following are the risks that would be transferred to the
developer:
a. The mobilization of finances would be the responsibility of the private
developer and the risks associated with the financial aspects in terms of
profitability and returns would lie with the developer
b. The risk of adhering to the Applicable Law would be passed on to the private
developer.
c. The risk of time-bound completion of the Project would be passed on to the
private developer. Since the revenue streams for the private developer from
the Project would commence only after completion of the Project, it would be
in the interest of the private developer to complete the Project as early as
possible.
The risk of over-runs in construction cost and operational expenses would be borne by
the private developer.

DoT
15 Years

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6.4 Recommendation
Based on the evaluation of various options for implementation and the Financial
Analysis carried out for the Project, it is recommended to adopt the ‘concession’
structure for successful implementation of the Project. The concession contract
under a Design, Build, Finance, Operate, Transfer framework would be the preferred
option, as DoT would receive higher returns from the Project, with no investment or
revenue risk of the Project.
In lieu of the land being offered by DoT along with the Development rights for the
setting up of the Art and craft village, DoT can seek a Concession Payment on
Annual/half yearly basis with an escalation of 5% every year.
The concession period, based on the Financial Analysis carried out for the
assignment, is 15 years, including the construction period of 1 year. The summary of
the financial viability carried out for the Project is presented in the next chapter.

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6.5 Project Layout

0 – Gates 1 – Parking 2 – Sewage Plant 3 – Craft Shops 4 – Managing Office 5 – Toilets
6 – Rest Lounge 7 –Other Handloom/Art Shops 8 – Food courts 9 - AmphiTheater 10 – Activity Lounge 11 – Shops
A – Conference Room B – Meeting Area T –Ticket Counter

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7. Recommendations and Way Forward
Travel and tourism, the world’s largest industry, is a key driver of economic
growth. Given this background the development of appropriate infrastructure
facilities for promoting tourism would go a long way in developing the state’s
economy.
The spin-off benefits from this project could be quite substantial, in terms of:
 Employment generation for a large number of artisans.
 Development of facilities which could bring forth rich cultural heritage in
citizen’s conscience.
 Development of Bangalore as a cultural centre.
Being on the outskirts of a major city, the project has good potential to effectively
channellise tourism promotion efforts of the state. The landmark project with
appropriate encouragement from the Central and State Government could go a
long way in establishing this as not only a tourist attraction but a boon to artists
and performers giving fillip to the arts community in the country.
Based on the financial analysis carried out for the project, the project could
generate sufficient revenues, meeting the operations and maintenance costs of
the project.
The project would require extensive and regular maintenance and it is
recommended that a major part of day-to-day management and maintenance of
the project is handed over to a professional agency upon commissioning of the
project.
Co-opting artists to the trust managing the art and craft village could ensure that
the development of the project would be able to meet the aspirations of the local
artists, since such a forum could provide feedback on the activities planned or
carried out by it.

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Annexures

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Annexure 1
Assumption Sheet
General/Macro Assumptions
Tax rate : 35%
Inflation Rate : 5%

Project Assumptions
Project Duration : 15 years
Start date : 2016
Completion date : 2017
Construction period : 12 months

Revenue Assumptions
Tourists flow
Tourist inflow (weekday) : 500 per day
Tourist inflow (weekend) : 1000 per day
Tourist inflow per year : 234000
Growth rate in tourists per yr : 1%

Amphitheatre/ Music Concert Hall/Performing Centre
Average Rental of facilities per show : 500
Number of shows per year : 200

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Growth in rentals p.a
:
1% p.a

Food and Beverages (Rented and LeasedOutsourced on Revenue sharing basis)
Hours of operations : Full Day

Gate fees
Entry fees per person : Rs 20 (adult) and Rs 10 (adult).
Growth p.a in ticket fee : 1%

Cottages
Number of cottages : 10
Rate per cottage per day : Rs 500.
Occupancy of cottages : 300 days
Growth rate in cottage charges p.a : 1% p.a

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Annexure 2
Dilli Haat
Dilli Haat is a treasure house of Indian
culture, handicrafts and ethnic cuisine, and
from a variety of cultural traditions of India.
Unlike the traditional weekly market, the
village Haat, Dilli Haat is permanent. It is
located in the commercial centers of South
Delhi, opposite INA market. The 6 acres of
land on which this complex is situated was
salvaged as part of a reclamation project and transformed into a plaza. Extensive
foundation work, small thatched roof cottages and kiosks give the plaza a village
atmosphere. Some shops are permanent but other sellers are rotated, usually for
fifteen days.
Products offered may include rosewood
and sandalwood carvings, embellished
camel hide footwear, sophisticated fabric
and drapery, gems, beads, brassware, metal
crafts, and silk and wool fabrics. A number
of shows promoting handicrafts and
handlooms are held at the exhibition hall in
the complex. To sell wares, there is an
application process and spaces are
allocated according to which state the seller is from. In all, Dilli Haat, INA Market
has 62 stalls allotted on a rotational basis to craftsmen a payment of INR 100 per
day for a maximum period of 15 Days.
Dilli Haat INA is open to public, 10.30 am to 10.00 pm., seven days a week, at a
nominal entrance fee, Rs. 20 for Adults, Rs.10 for Children, Rs. 50 for foreigners.
The craftsmen who are registered with
D.C.Handicrafts are the ones who are
eligible to find a place at the Dilli Haat.
This ensures that visitors get to buy
authentic wares at prices that have not
been inflated by high maintenance costs.
Step inside the complex for an altogether
delightful experience by either buying

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inimitable ethnic wares, savouring the
delicacies of different states or by simply
relaxing in the evening with the entire
family.
DILLI HAAT transports you to the magical
world of Indian art and heritage presented
through a fascinating panorama of craft,
cuisine and cultural activities.
DILLI HAAT is not just a market place; it has been visualized as a showpiece of
traditional Indian culture- a forum where rural life and folk art are brought closer
to an urban clientele. It is here that the crafts persons find an opportunity to
demonstrate their artistic skills to thousands of visitors everyday.
Since its inauguration in the month of March 1994, Dilli Haat has been home to
thousands of handicraft and handloom artisans.
The complex is not only artistic, but also recreational in nature where the entire
family can have a good time.
There are stalls dishing out sumptuous delicacies from different States and Union
Territories; an Exhibition Hall; a Souvenir shop selling an assortment of small gift
items; an open stage for cultural programmes and a playing area exclusively
earmarked for children.
The architectural features of the complex have been especially designed in the
traditional north Indian style, with brickwork jail (lattice) and stone roofs.
A hall in the complex specifically caters to exhibitions of the handlooms and
handicrafts. A souvenir shop, also displays attractive ethnic products.
The small thatched roof cottages and kiosks, without any concrete structures
provide a village atmosphere.
The shops are set up on platforms, which act as a link in the Bazar design. The
courtyards between the shops are paved in
stone and interspaced with grass to retain a
visual softness.
The landscaping of the area incorporates
colourful flowering shrubs and trees, thus
the entire complex is in harmony with the
environment.

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Dilli Haat Layout

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Annexure 3
Shilparamam, Hyderabad, Telengana
Shilparamam is an arts and crafts village which is located in Madhapur, Hyderabad,
Telengana. Shilparamam was developed in 1992, with an idea of preserving the
traditional art of Telengana. There are ethnic festivals all over the year. Spreading over
a 65 acres of land, the art & craft village is only a few kilometers away from the main
city of Hyderabad.


Situated in the of hi-tech hub city of India, Shilparamam gives a scenic ambience of
tradition and cultural heritage. For promotion and preservation of Indian arts and crafts
and to motivate the artisans, the state government established this platform.

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Enchanting the blend of arts and artifact, epitomizing the true legacy with the diverse
natural beauty of rural India; Shilparamam is tribute to Telengana. Exhibiting the rustic
richness and creativity of Hyderabad, it has captivated the imagination of visitors.
The lush and serene environment of Shilparamam is sculpted with woodwork, jewellery,
cloths and local crafts of each region of the country. Showcasing a plethora of artistic
ethos, Shilparamam is set amidst gardens, cascading waterfalls and natural rock heights.
Facts & Figures:
Visiting Hours 10.30 am to 8 pm
Entry Fee Adult: Rs. 40
Children: Rs. 20
Villageing Available
Villageing Fees 4 wheelers: Rs. 20 for first 3 hrs, Rs. 10 per hr or
part thereof.
2 wheelers: Rs 10 for first 3 hrs, Rs. 5 per hr or
part thereof.
Major Attractions:
The Rural Museum:
The rural museum, surrounded by trees, is a miniature depiction of typical Indian village.
Over 15 life-sized huts, authentically constructed out of baked clay and thatch, depict rural
and tribal lifestyles and the life of various artisans. It provides a window to rural life for city
dwellers and those who have never visited a village before. The museum houses sculptures
and life size models depicting the day-to-day activities of the rural artisans.

41. Development of Art and Craft Village in Bangalore, Karnataka
GOVERNMENT OF KARNATAKA INITIATIVE


41
The Rock Museum:
Artist Subroto Basu from Shantiniketan has fashioned a rock garden here by blending his own
rock collections with the natural and picturesque rock formations found in the village. The
natural formations stand unswayed in a scenic form in Rock Museum. This Rock Museum
adds a fantastic ecological side to Shilparamam.


Recreation Zone:
Boating
Shilparamam has a beautiful lake which also offers the delight of boating in it. Both rowing
and paddle boats are available.
Shopping
Shilparamam has hundreds of stalls. There is a wide range of handicrafts available for
shopping, right from toys to carpets. Here visitors can buy hand made sarees and textiles of
different states. Textiles ranging from Tangail, Sambhalpur, Paithni, Kashmiri to Kanjeevaram,
Dharmavaram, Tanjavur, Madurai, Peddapuram, Bandar, Guntur and other sarees. It also has
salwaar kamiz, ghagras, kurta, carpets, etc. Here a special Artisan Bazar is also there providing
the original art forms directly from the makers.