In an attempt to further reinforce Tamil Nadu’s position as an attractive investment destination for global industries, the state government unveiled a New Industrial Policy, 2021, which aims to attract ₹10 lakh crore in new investments and create 20 lakh jobs by 2025.
The policy seeks to achieve an annual growth rate of 15% in the manufacturing sector and increase the contribution of the sector to the state’s economy to 30% by 2030, a government release said.
“I am happy to be in your midst as I complete four years of my term as chief minister and enter the fifth year and to see the vast progress the state is making on the industrial front and to unveil a new industrial policy that will help the state leap into its next phase of growth,” chief minister Edappadi K Palaniswami said after unveiling the policy. He also inaugurated eight completed projects involving an investment of ₹3,377 crore and offering employment to more than 7,000 people.
The state government also signed 28 MoUs that will pave way for new investments of more than ₹28,000 crore in TN across sectors, including smartphones, electric vehicles, wind energy and auto components, city gas distribution and textiles. These investments will result in employment generation to nearly 69,000 people, a government statement said.
“The policy has given a special thrust to sunrise sectors, including aerospace and defence, renewable energy components, electronics, medical devices, electric vehicles, pharmaceuticals, technical textiles and medical textiles (biotechnology)” a senior official said.
Among the key investors are Tata Electronics, which will invest ₹4,684 crore and employ more than 18,000 people in its unit in Krishnagiri district, and Pegatron Corporation, Taiwan, investing ₹1,100 crore and employing more than 14,000 people at Mahindra World City. Both the companies will make Apple products and join Foxconn and Salcomp to make Tamil Nadu the new hub in Apple products manufacturing.
“I appreciate the swiftness with which the Tamil Nadu government, especially the IAS officials, helped the group to locate the new unit in the state. It showed the state’s hunger to attract large scale industrial investments and create employment generation opportunities to the people,” N Chandrasekaran, chairman, Tata Sons said, addressing the gathering virtually.
“Tamil Nadu is poised for greater growth not just in manufacturing, but also in the emerging sunrise sectors, especially electronics, as the Centre is giving a lot of thrust for this segment under Atma Nirbhar,” said Venu Srinivasan, CMD, TVS Motor Company, in his address at the event. Another key focus of the new industrial policy is to ensure that industrial clusters emerge across the state and not just restricted around Chennai and a couple of other regions. The policy has expanded the number of industrially backward districts in the state to 22, from the earlier 12, to enable industries to avail of special incentives to establish industrial units in the backward districts.
“New industrial units being established in all these backward districts will now get 50% subsidy on land cost and subsidy in registration fee. In addition, unlike earlier where a minimum of ₹300 crore investment was needed to avail of the state-level incentive push, it has now been scaled down to enable even ₹50 crore investment to avail of these benefits,” the senior government official said.
Further, the criteria for offering capital subsidy has been made flexible and freedom has been given to the industries to structure it themselves. Unlike earlier, where capital subsidy was offered based on investment size, the new policy structures the capital subsidy based on investment as well as employment potential. “While capital intensive industries like automotive may require larger investment but with lower employment potential, emerging sectors like electronics offer high employment with lower investments,” the official explained.