Tamil Nadu's industrial development model: Make in State, make across State

CHENNAI: As much as the volume and size of the investments that Tamil Nadu has managed to attract over the years, including the recent past, it was the diversity of sectors and their geographical spread that make the Tamil Nadu story special.

Unlike some of the competitor states like Maharashtra, Karnataka and Telangana where investments are mostly concentrated on a couple of cities like Mumbai, Pune, Bengaluru and Hyderabad, Tamil Nadu ensured that they are distributed across the State.

For instance, only four of the 30 districts of Karnataka and four of the 34 districts of Maharashtra accounted for 50% of the Gross State Domestic Product (GSDP). It is an altogether different story in the case of Tamil Nadu.

According to a State Directorate of Economics and Statistics report on district-wise contribution to GSDP, at least 8 of the 32 districts of Tamil Nadu contributed to 50% of the GSDP or the growth story. While Bengaluru and Mumbai accounted for 36.9% and 19.8% of their respective State’s GSDP, the numbers from Tiruvallur (9.3%), Chennai (8.2%), Coimbatore (7.6%), Kancheepuram (7.1%), Vellore (5.1%), Erode (4.6%), and Tiruchy (4.3%) demonstrate an admirable spread in industrial and economic efficiency in Tamil Nadu.

Even in the latest round of investment commitments, the State government, operating within geographical and logistical limitations, spread the investment to the extent it could. For instance, the green hydrogen and ammonia projects would shape up Thoothukudi, a major district in the southern tip of the State.

The approval accorded by the Cabinet for the 14 projects a few days ago is also a telling example of the scattered growth story. The second biggest investment cleared by Cabinet, Rs 10,375 crore project of Leap Green Energy, would come up in Thoothukudi, Virudhunagar, Tirunelveli and Ramanathapuram.

Even Ariyalur, one of the smallest and least-developed districts in the State, received a Rs 1,000 crore investment by Freetrend Industrial India. It is the most job-intensive (15,000 jobs) project cleared by the Cabinet.

Likewise, the Rs 9,000-crore Jaguar Land Rover plant from the Tata Group has been established at Ranipet, far away from Chennai, which earned the moniker Detroit of Southeast Asia for hosting automobile behemoths in its backyard.

In the same region, Hosur in Krishnagiri district on the western fringe of the State is emerging as the EV hub of the State, with Ola and Ather complementing its industrial ecosystem supported by Ashok Leyland and TVS Group.

The State’s dominance is clear from the data that shows that 46% of the electric two-wheelers manufactured in the country are made in Tamil Nadu.