JOIN USTamil Nadu looks at grabbing investments from firms moving out of China
Tamil Nadu, one of the most industrialised states in the country, wants to convert the COVID-19 crisis, which has hit the world hard, into an opportunity to garner investments from firms that are planning to shift out of “certain countries” due to the pandemic.
Chief Minister Edappadi K Palaniswami has constituted a Special Task Force, headed by Chief Secretary K Shanmugam, to attract new investments from companies that are likely to exit from “certain countries” and relocate their manufacturing bases in countries like India to “diversify” their supply chain.
Without naming China, where the COVID-19 outbreak began at the end of 2019 and now threatens the whole world, Tamil Nadu government said the committee would look for investors from Japan, South Korea, Taiwan, Singapore and the US who might relocate their investments to India to create “employment opportunities” for youth.
The 13-member Special Task Force will include top bureaucrats, nominees from trade organisations of some of the aforementioned countries and representatives from top companies from these countries who have already set shops in the state. The panel will submit its first report in a month.
One of the leading destinations for Foreign Direct Investments (FDI) into the country, the state has attracted USD 29,848 million in FDI from April 2000 to March 2019. According to figures released by the government, Tamil Nadu had retained its position by attracting USD 2,613 million during 2018-19. It is also the third largest exporter of goods in the country.
Explaining the move, Industries Minister M C Sampath told DH that Tamil Nadu has immense potential to house more industries, particularly in automobile, electronics, and aerospace sectors.
“Chief Minister Edappadi K Palaniswami has announced the task force even while we fight COVID-19 to ensure that the state is at the forefront in attracting investments that might move out of a few countries and come to India. We have already established a name for ourselves and such planning at an early stage would certainly give us a head-start,” he said.
Sampath said since top companies from countries like South Korea, Japan, US, and Taiwan already have their base in Tamil Nadu, the government will also involve representatives from these firms to garner more investments. Chennai is home to several automobile majors like BMW, Hyundai, Ford, Daimler, and also houses top electronic manufacturers like Foxconn, Samsung, and Dell.
“We have been giving much emphasis to our e-vehicle and start-up policies. We will intensify our efforts to attract investments in these sectors. And aerospace is a key area for us as the state has set up an aerospace park near Chennai for companies in the sector to set shops,” he added.
MSMEs, which are considered the backbone of Tamil Nadu’s economy that employs more than 12 million people, are already sensing a great opportunity with several analysts predicting that global manufacturers would shift base to India from China. The state alone has over 8.5 lakh micro, small and medium industrial units.
Sampath also said the state’s industrial-friendly policies, manpower, and abundant skill power would help many firms choose Tamil Nadu, which he said, was a promising destination for investors.
“Also, we have a land bank in government-owned SIPCOTs which would save the companies of hassles in acquiring land. And we have the advantage of three seaports in and around Chennai that would make the state more suited for many investors,” he added.