Last week, Google parent Alphabet set its foot in Tamil Nadu with an investment to manufacture Pixel smartphones and drones. With investments from players such as Tesla rival VinFast to Tata Power and expansion plans from Apple suppliers such as Foxconn, Tata Electronics and Pegatron, 2024 is shaping up to be a golden year for the southern state, attracting investments worth over Rs 7 trillion and creating over 3 million jobs in just five months.

This is in addition to the total investment of Rs 2.97 trillion in the last two years, creating 415,282 new jobs. According to the government and industry experts, ease of doing business, single window clearances, investor-friendly land policy, availability of skilled workers and proximity to ports and major markets are driving Tamil Nadu’s growth story. A large portion of these jobs are coming in the job-intensive electronics sector.

Interestingly, Chennai, Hosur and Coimbatore have emerged as the preferred destinations for investors. Tamil Nadu Industry Minister TRB Raja said, “The quick launch of projects such as Omron, Vinfast and Tata Electronics reflects our ability to execute projects swiftly and efficiently. Our success is driven by sector-specific policies, aggressive outreach to potential investors, incorporating their feedback in a timely manner and tailor-made pitches that meet their needs.”

Another state that will get huge investments in 2024 is Gujarat, which received investment proposals worth Rs 26.33 trillion during the investors meet. However, sources say the advantage with Tamil Nadu is that most of the investment announcements have been confirmed and are already underway.

“Tamil Nadu has streamlined the processes of setting up a business and obtaining necessary approvals, making it easier for investors to start operations. The single-window clearance system has added more departments and approvals to its ambit, ensuring greater speed, efficiency and transparency,” Raja said. He said one of the factors that adds to the state’s attractiveness is the large pool of skilled professionals, especially in the engineering, IT and manufacturing sectors, backed by prestigious academic institutions. About 170 clearances from 25 departments are obtained through this single-window system.

In terms of electronics, the state is the number one exporter in India, with exports reaching $9.56 billion in FY24, up 78 per cent from $5.37 billion in FY23 and far ahead of Karnataka and Uttar Pradesh. Industry veterans are also excited about the growing global interest in the state.

R. Dinesh, President, TVS Supply Chain Solutions, said, “The state has not only focused on improving the ease of doing business but also supporting the ecosystem – be it skill upgradation or providing women employees access to equal growth through opportunities, etc.”

“I have personally received a lot of positive feedback from potential foreign investors from the EV/sustainable sector and other new age sectors about the proactive outreach by the Chief Minister and the Industrial Minister, which may have resulted in the rapid commitments we are seeing today,” Dinesh said.

“We offer well-designed incentive packages that balance the benefits of investors with the interests of the state. Tamil Nadu has a long history of stable and investor-friendly policies that provide various incentives and support mechanisms for industries and foreign investments,” the minister said.

The state also provides wage subsidies for women, persons with disabilities, and trans women, as well as wage subsidies for high-value jobs at global competence centers, promoting diversity, equity, and inclusion in the workforce.

Subburathinam P, chief strategy officer, TeamLease Services, said, “The advantage with Tamil Nadu is that most of these job opportunities are coming in electronics, which is an employment-intensive sector. In Sriperumbudur and Hosur alone, some companies in the electronics sector can bring more than 50,000 jobs. There are also other emerging sectors like EVs that are adding to the employment scenario in the state. New areas like Tuticorin are fast developing as an industrial belt, while traditional textile areas like Tiruppur are strengthening by adopting new industries as an extension of Coimbatore.”

first published: May 30, 2024 | 6:16 pm First

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