Pressing the Growth Pedal
Organiser   20-Jul-2018

Union Government has led Tamil Nadu marching towards the industrial progress with speedy infrastructure development

TS Venkatesan, Chennai

While Tamil Nadu (TN) is facing protests after protests, the opposition is blaming the Central Government for this crisis and even accusing that the industrial growth has come to a standstill. However, the State is all set to get a bonanza in the form of new industrial corridors, road projects, airports and new rail routes.


Pepped up and wrongly motivated, instigated agitations against Neduvassal, Kadiramangalam Hydro carbon project, Theni Nutrino project and recent closure of Sterlite copper smelter, there is a fear among industrialists and investors in choosing TN as their industrial destination. Already there were rumours of TN Ministers asking for a cut or percentage of protection money from would be investors or industrialists. Thus, it was alleged, it forced them to look out in neighbouring states to set up their shops. Undeterred by all this negative development, the Centre is pushing hard for new projects for the State to generate more employment opportunities and envisioning a sustained industrial growth.


Disoriented Development

In TN, close to 50,000 micro, small and medium enterprises (MSMEs) have been wound up in the State in just one year on account of a host of factors including 2015 floods, Vardah cyclone, etc. A Government policy note tabled by the MSME Ministry in the Assembly on May 7 showed that the total number of registered micro, small and medium industrial units in the State has dipped by a significant 18.45 per cent in 2017-18 from the previous year. In absolute numbers, as many as 2, 67, 310 MSMEs were registered in 2016-17; this figure fell to 2, 17, 981 during 2017-18. This means 49,329 industrial units wound up operations in one year. In a parallel development, the number of workers employed in MSMEs has fallen by over five lakh during the same period. In 2016-17, the number stood at 18, 97, 619, but in 2017-18, it dwindled to 13, 78, 544. But the Minister of Industries, MC Sampath said that the State had lined up investments to the tune of Rs. 45,000 crore in sectors including automobile, tyre manufacturing and textiles. The Minister also said that work was on in full swing for the upcoming Global Investors’ Meet, 2019.


“The situation is not what you claim. The power scenario has improved and Tamil Nadu has become a production State attracting investments,” Minister of Electricity, Prohibition and Excise, P Thangamani said refuting the charges levelled by Congress member H Vasanth Kumar. Contending that many industrial estates have become non –functional, Vasanth Kumar alleged that no new industry has come up in Tamil Nadu.

Major Development Initiatives in Tamil Nadu by Central Government
  • Defence Minister Nirmala Seetharaman inaugurated a Rs.4.5 crore , 16 MW grid connected solar power plant, set up by Bharat Electronics Ltd (BEL) one of the Navaratna Public sector undertaking, at Heavy Vehicle Factory in Avadi.
  • To undertake dredging and deepening of TN ports, Centre allotted Rs 8,800 crore
  • For cleaning rivers, a sum of Rs. 623 crore has been given
  • Under the Housing for All projects, TN has been given Rs 6,000 crore
  • Under the Ujjawala scheme, 10 lakh people in the State have been benefitted
  • To ease the traffic snarls in Nagarcoil, Rs 300 crore elevated road project from District collectorate to Kottar
  • Greenfield Airport at Samythoppu at Rs 800 crore
  • 50 year old dream project of Kanyakumari people, commercial port at Enyam to be implemented at a cost of Rs 28,500 crore
  • The four lane inner Ring road project is being undertaken at an estimated cost of Rs 2,300 crore
  • Centre cleared setting up of AIIMS 750-bed modern facility at Thoppur near Madurai at an estimated cost of Rs 1,500 crore in 200 acres
  • Three twin track rail electrification and gauge conversion projects in Madurai-Vanchi Maniyachi Tuticorin, Vanchi Maniyatchi, Tirunelveli- Nagercoil - Kanyakumari, Nagercoil - Thiruvananthapuram routes
  • Tambaram-Chengleput elevated road project at an estimated cost of Rs 2,250 crore
  • Poonamallee-Maduravayal express way project at an estimated cost of Rs1,500 crore
  • Chennai- Nellore Express way ( Rs 1, 000 crore)
  • Conversion of National High ways-Chennai-Tada, Trichy, Chidambaram, Poonamallee, Walajabath, Villupuram-Nagapattinam
  • Rs 20,000 crore - Chennai-Bangaluru Fast tract express way
  • Rs.10, 000 crore project to connect Chennai and Salem through an eight lane highway which is facing opposition from people and opposition parties


Central Government Leading the Way

In a recent function held at Sriperumbudur, the birth place of Vaishnava Saint Ramanujar, Union Industries and Commerce Minister Suresh Prabhu and TN Deputy Chief Minister O Panneerselvam (OPS) among others participated. In that function OPS has urged the Centre to provide speedy approvals for the Chennai-Bengaluru and the Chennai-Kanyakumari industrial corridor projects to boost manufacturing activities in the state. The Deputy CM also said TN would set up an aerospace park over 250 acres area near Sriperumbudur. He said that setting up of defence production corridors across the State linking existing public sector undertaking manufacturing facilities with new capacities. He said these are aimed at boosting the manufacturing activities in the State. OPS said the proposed setting up of defence production corridors across the Tamil Nadu linking existing public sector manufacturing facilities with new capacities to be created in the private sector would boost engineering manufacturing.



"I take this opportunity to request the Union Commerce and Industry Minister Suresh Prabhu to ensure that speedy clearances are accorded to the Chennai, Bangaluru industrial corridor and the Chennai Kanniyakumari industrial corridor projects," said O Panneerselvam. He also briefed that, “Both the JICA and Asian Development Bank are working with Tamil Nadu government on developing the trunk infrastructure for these projects. All support to investors to facilitate investments in the state would be assured.”

The Deputy CM also added that the State has all the modern infrastructure and policies to attract and facilitate investments saying the biggest strength of TN is the availability of high quality and disciplined human resources.According to him, the gross state domestic product (GSDP) of Tamil Nadu grew at a compounded annual growth rate of 11.16 per cent between 2005-06 and 2016-17, reaching


USD 207.79 billion in 2016-17. He said to promote innovation and manufacturing; the TN government has announced USD 1.55 billion worth of assistance for strategic entrepreneurship and innovation programme for the period of 2017-2021. Dy CM O Panneerselvam also added that, “TN ranks third in terms of FDI inflow into the country and cumulatively FDI inflows in Tamil Nadu from April 2000-September 2017 stood at USD 25.92 billion.”

  • Undeterred by all the negative developments in Tamil Nadu, the Centre is pushing hard for new projects for the State to generate more employment opportunities

  • Due to the recurrent on and off anti-Modi and BJP protests, Modi’s largesse go unnoticed. Tamil Nadu State BJP leaders have failed to sensitise the masses about the same


Putting Development over Deformation 
Economist Venkatesh Athreya states that, “Tamil Nadu is already an industrial State. But it has been mired in uncertainty after the death of former Chief Minister J Jayalalithaa. During this period, the competition for investments has increased among states. The government must take steps to woo investors like having a new industrial policy and clearing permissions from various departments without delay.” Quoting the data, he informed that Tamil Nadu was ranked 7th in the country in terms of the total investments received from January 2016 to December 2017. According to the data released by the Department of Industrial Policy and Promotion (DIPP), TN had received investments of Rs 6,367 crore while Maharashtra was on top with Rs 59,581 crore, followed by Gujarat with Rs 18,062 crore. In terms of the number of industrial entrepreneurs’ memorandums (IEMs) implemented between January 2016 and February 2018, Tamil Nadu is in 11th place with a total of 40 IEMs.

M Velmurugan, Executive Vice-Chairman, Tamil Nadu Industrial Guidance and Export Promotion Bureau in an interview to a leading portal said, “Between September 2017 and April 2018, we have created employment for about 5.1 lakh persons in the state. We, as a state, may not be seen making big statements but we have been going about in our own way.” According to the Employees Provident Fund (EPF) data released on May 25 this year some 39.36 lakh jobs were created in the country’s organised sector in the second half of the last financial year that ended in March 2018. A notable revelation in the data was Tamil Nadu being second among the states in creating employment in the organised sector.

“The eight-lane project will not only benefit the five districts it passes through, but the entire State. The importance of the project can be understood from the fact that it is only the second expressway project to be executed in the country. Infrastructure like good roads is essential to attract investments. The green corridor is one such.”
-Edappadi K Palaniswami Chief Minister, Tamil Nadu

“As many as 12,000 employees are affected directly and indirectly due to the closure... these people will be given priority in future government projects such as the establishment of Madurai-Thoothukudi Industrial Corridor, the seawater desalination plant and shipbuilding yard.”
– Kadambur C Raju, Minister for Information & Publicity, Tamil Nadu, on the closure of Sterlite


According to Velmurugan, “Over 4.65 lakh people got jobs during this period in the State. In the last four months, the State has been able to attract investments to the tune of Rs 45,000 crore between February and May. All the investments will be in the manufacturing sector that has a tremendous employment potential.”

He also points out that, “Tamil Nadu being hub of Automobile, automobile components and electronics industries and auto components majors like TVS Motors, Rane, Amalgamations Group have been functioning in the State. These companies supply 23-24 per cent of Bharat’s automobile component products and traditionally, the State has been strong in the automobile and manufacturing sectors. Chennai has emerged as one of the world’s leading research and development (R&D) centres for automobiles. There are three major ports, an international airport and good roads that connect to all parts. Chennai’s air cargo is the second largest in the country.”


Deferring his views, Vedic Science Research Centre director Gauthaman said that Tamil Nadu, once a hot investment destination is now slipping in all indicators to attract investment due to widespread corruption, indecisive and unstable Government and above all disturbing social unrests in the name of protests which are manufactured by anti-national elements. In a report he quoted, “The National Council of Applied Economic Research rated Tamil Nadu as the 6th best State in the country to attract Investments in its 2017 survey based on 2015-16 data. The indecisive Government and a string of orchestrated protests are plaguing the State and this can be justified by the phenomenal drop in investment over the past two years”.


“Tamil Nadu attracted an investment of 19,811 crore in 2015 and it dropped by 1/3rd to 6,172 crore by 2016 and further down by a half of 2016 value to 3131 crore in 2017. In fact, the State attracted just 0.79 per cent investment in 2017 and ranked 12th among the Indian States in attracting investments. Despite its huge potential with availability of skilled labour force, education and physical infrastructure and connectivity, Tamil Nadu continues its downward spiral resulting in loss not only to the State exchequer but also in terms of Employment and livelihood.


Gauthaman points out that, “To visibly realise the loss of Tamil Nadu, it is to be seen that an Industrial park promoted by Andhra Pradesh Government by the name Shri City, just across the border, which is hardly an hour and a half drive from Chennai is witnessing a phenomenal growth. Piolax Inc, which supplies spares to Automobile giant Nissan in Oragadam Tamil Nadu, preferred Shri City to Sriperumbudur-Oragadam Corridor. Shri City is the preferred location of Alstom, a manufacturing industry that manufactures coaches for Chennai Metro. The Automobile manufacturing giant Isuzu has chosen this Andhra Pradesh Industrial Estate after dismissing Tamil Nadu. A host of Japanese investors like Kobelco cranes India Pte Ltd, Kobelco Construction Equipment India Pte Ltd, Kobelco Plate Processing India Pte Ltd, Piolax Inc etc have chosen Shri City over Tamil Nadu.


This is, in no way, a minor issue to be swept under the carpet.”


Gauthaman also states in his report that after the demise of Jayalalitha and retirement of Karunanidhi from the active politics, the State is bereft of powerful mass leaders and the present Government or party has or for that matter any opposition party got an appealing leader.


The entire Government machinery is more concerned about minting money rather than providing able administration. Government officials at all levels from the Chief Secretary are keen on completing their tenure smoothly, thereby abdicating their responsibility to take critical/ crucial decision for the welfare of the State and National security. Seizing this opportunity all anti-social, anti-national elements ably supported by Inter National forces create anarchy in the name of protests, people’s movement, etc.


After the closure of Sterlite Copper Smelter plant in Tuticorin, the TN power distribution company, Tamil Nadu Generation and Distribution Corporation (TANGEDCO) has been facing Copper shortage. Due to unavailability of copper, Transformer erection is being hit.


Be that as it may, the Bharat sarkar led by PM Modi has initiated several crore worth projects for Tamil Nadu. Due to the recurrent on and off anti -Modi and BJP protests, Modi’s largesse go unnoticed. State BJP leaders have failed to sensitise the masses about the same.


Like the proverb, the left hand doesn"t know what the right hand is doing, the NDA government, despite jillion protests against it, has been extending projects after projects without any hub bub. A day will come when the people start enjoying its benefits and think of Modi’s largesse to the State.