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 leaders in several industries like automobiles and auto components, engineering, pharmaceuticals, garments, textiles, leather, 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 2015-16 and 2020-21, Gross State Domestic Product (GSDP) is expected to expand at a Compound Annual Growth Rate (CAGR) of 12.20 per cent to reach Rs 20.92 trillion (US$ 299.32 billion). Net State Domestic Product (NSDP) expanded at a CAGR of 12.17 per cent to touch Rs 16.73 trillion (US$ 231.49 billion) between 2015-16 and 2019-20.

In 2019-20, tertiary sector contributed 54.63 per cent to state’s Gross State Value Added (GSVA) at current prices, followed by secondary sector at 31.92 per cent.

As of March 2020, the state had a total installed power generation capacity of 32.84 gigawatt (GW).

According to Department for Promotion of Industry and Internal Trade (DPIIT), cumulative Foreign Direct Investment (FDI) inflow in Tamil Nadu and Puducherry stood at US$ 32.20 billion between April 2000 and March 2020.

Total merchandise export from the state stood at US$ 30.52 billion during 2018-19. During April-December 2019, export stood at US$ 22.90 billion.

IT & ITeS export from Tamil Nadu increased to Rs 1.39 lakh crore (US$ 19.9 billion) in 2018-19, at a growth rate of 10 per cent y-o-y.

Tamil Nadu Industrial Guidance and Export Promotion Bureau has been set up with an objective to attract major investment proposals to Tamil Nadu.

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

• Comprehensive Road Infrastructure Development Programme (CRIDP) is a flagship scheme to upgrade road infrastructure in the State. Under Budget 2020-21, Rs 5,500 crore (US$ 780.25 million) has been allocated to the scheme.
• The Asian Development Bank assisted Tourism Development Project is currently under implementation and a sum of Rs 90.85 crore (US$ 12.89 million) has been provided in the Budget Estimates of 2020-21.
• In 2019, Chief Minister launched the Tamil Nadu New Integrated Textile Policy, 2019.
• According to 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 memorandum of understanding (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 ranked first in terms of domestic tourist arrival and second in terms of foreign tourist arrival in 2018(P). In 2018, foreign tourist arrival reached 6.07 million, while domestic tourist arrival reached 385.90 million.

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

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