Industrial Development & Economic Growth in Tamil Nadu

Tamil Nadu is the fourth largest state of India. It has a diversified manufacturing sector and features among the leading states in several industries like automobiles, components, engineering, pharmaceuticals, garments, textile products, leather products, chemicals, plastics, etc. It ranks first among the states in terms of number of factories and industrial workers.

Tamil Nadu Industrial Development Corporation Ltd (TIDCO), State Industries Promotion Corporation of Tamil Nadu (SIPCOT), Tamil Nadu Industrial Investment Corporation Limited (TIIC), and Tamil Nadu Small Industries Development Corporation Limited (TANSIDCO) are jointly developing industrial infrastructure in the state.

Between 2011-12 and 2018-19, Gross State Domestic Product (GSDP) expanded at a Compound Annual Growth Rate (CAGR) of 11.46 per cent to Rs 16.06 trillion (US$ 222.58 billion) whereas the Net State Domestic Product (NSDP) expanded at a CAGR of 11.45 per cent to Rs 14.41 trillion (US$ 199.69 billion).

As of November 2019, the state had a total installed power generation capacity of 31.92 GW.

According to the DPIIT, cumulative FDI inflows in Tamil Nadu during April 2000 to September 2019 amounted to US$ 31.19 billion. Total merchandise exports from the state stood at US$ 30.52 billion during 2017-18. During April-September 2019, exports stood at US$ 15.33 billion. As of March 2019. IT & ITeS exports from Tamil Nadu have increased to Rs 1.39 lakh crore (US$ 19.9 billion) in 2018-19, at a growth rate of 10 per cent year-on-year.

As of November 2019, the state had 54 formally approved SEZs, 50 notified SEZs and four with in- principle approval SEZs and has total 40 exporting SEZs.

Tamil Nadu Industrial Guidance & Export Promotion Bureau has been set up with the objective of attracting major investment proposals into Tamil Nadu.

Some of the major initiatives taken by the government to promote Tamil Nadu as an investment destination are:

• According to the Good Governance Index 2019, Tamil Nadu ranks first in terms of governance.
• Tamil Nadu organised its second Global Investor Meet (GIM) on January 23 and 24, 2019. The state surpassed the targeted investment and attracted Rs 3.4 lakh crore (US$ 48.65 billion) investment in 12 sectors including automobile, textiles, renewable energy, etc. Around 146 MoUs were signed with an expectation to generate 10.5 lakh job opportunities in the state.
• During September 2017-October 2019, 50,606 formal jobs were created in Tamil Nadu. *
• Tamil Nadu to get 6-8 lane expressways of 2000 km, 4 lane highways of 5000 km and all the highways to be double lane along with paved shoulders.
• The Tamil Nadu Government is implementing the Green Energy Corridor Project with the assistance of KfW at an estimated cost of US$ 247.25 billion for improving the transmission infrastructure in the state. As per budget 2018-19, US$ 39.88 million have been allocated for this project.
• The ‘Tamil Nadu Transmission System Improvement Project’ is being implemented at a cost of Rs 5,014 crore with the assistance of JICA for upgrading the transmission capacity of the State
• In June 2018, the State Government invested Rs 5,000 crore (US$ 745.82 million) to boost renewable energy policies, transmission infrastructure and commission a floating solar plant.
• In September 2018, Information Communication Technology (ICT) Policy, 2018 was announced by the state government for investors especially IT and ITeS companies, start-ups, MSMEs. This policy will provide incentives like administrative incentives, capital subsidies, and tax exemptions etc. to the investors.

Note: * - according to Employees' Provident Fund Organisation (EPFO) data, ** - Vision 2030

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