When Finance Minister Arun Jaitley draws up his Union Budget proposals for the next financial year, he will find a request from Tamil Nadu seeking prioritisation to the amalgamation of the Thoothukudi-Chennai leg of the East Coast Economic Corridor (ECEC) to the first phase of the project. The proposed ECEC is India’s first coastal corridor stretching from Thoothukudi to Kolkata. At present the first phase — exploratory work for which is already on — starts at Vishakapatnam and terminates at Chennai. You don’t need a rocket scientist to tell you that Andhra Pradesh will be the biggest beneficiary of the first phase.
Tamil Nadu wants to tag on immediately and not wait for the subsequent phases for corridor development.
Why is the ECEC important? For starters, an economic corridor involves trade facilitating policy framework and creation of efficient multi-modal transport within a defined area supported by quality infrastructure, logistics, setting up of distribution network that link production centres, urban clusters, and international gateways, thus resulting in regional economic integration and inclusive growth.
In other words, it will make the coastal stretch a beehive of economic activity tied to export between India and Mekong countries as well as other South East Asian countries.
The ECEC is part of a pentagon of corridors across the country to boost infrastructure and manufacturing to showcase India as a global manufacturing destination in line with Prime Minister Narendra Modi’s Make in India dream. The other four corridors are Delhi-Mumbai Industrial Corridor, Bengaluru-Mumbai Economic Corridor, Amritsar–Kolkata Industrial Development Corridor and Chennai-Bengaluru Industrial Corridor.
While presenting his budget last year, Jaitley had also said, “A National Industrial Corridor Authority, with its Headquarters in Pune, is being set up to coordinate the development of industrial corridors, with smart cities linked to transport connectivity, which will be the cornerstone of the strategy to drive India’s growth in manufacturing and urbanisation.”
ECEC hosts several ports. Bridging the East Coast with the East Asian countries is aligned to the Golden Quadrilateral and is envisaged to play a key role in India’s Look East Policy. Among the primary objectives of the ECEC are reviving manufacturing and creating jobs, establishing National Investment and Manufacturing Zones, industrial connectivity as well as linkages with ASEAN and East Asia. This would be achieved through promoting port-based economic development and creating the potential to develop ECEC into a Regional Economic Corridor.
The advantages of this project, linking Kolkata in the east with Chennai and Thoothukudi are manifold.
It is expected to touch the lives of nearly 48.5 million of India’s poor who live in the four states along this corridor. According to the Annual Survey of industries data 2010-11, these states account for about 23.85 per cent of the total industrial output and net value added. Tamil Nadu alone accounts for a little over 10 per cent. ECEC will create job opportunities for the poor by linking the well developing regions with the lagging ones.
Although the VCIC’S delineation covered eleven districts — nine in Andhra Pradesh and two in Tamil Nadu, it is noticed that the identification of nodes, production enclaves, logistics hubs and building supporting road networks are mainly confined to the Andhra Pradesh districts alone. This is mainly because of the time-bound commitment to be fulfilled by the Central Government under the Andhra Pradesh Reorganisation Act 2014.
Tamil Nadu now seeks coverage of the entire South East coast starting from Colachel in Kanyakumari district to Visakhapatnam, in the first stage itself. And, it has strong reasons to project its case. The coastal stretch between Chennai and Colachel has several development plans which are either firmed up or are in the take off stages. These include a Petroleum, Chemicals and Petrochemicals Investment Region (PCPIR), already approved by Government of India and having a potential to attract investments up to about Rs 90,000 crore (of which about Rs 25,000 crore has been anchored).
The other projects are National Investment and Manufacturing Zone (NIMZ) in Ramanathapuram district, Madurai-Thoothukkudi Manufacturing Industries Corridor and a 5 MT per year capacity LNG Terminal in Kamarajar Port being set up through a joint venture of Indian Oil Corporation and TIDCO.
Of the above, for the PCPIR development alone, investment up to Rs 13,354 crore has been firmed up for Infrastructure development including Road/Rail connectivity, as approved by the Cabinet Committee on Economic Affairs in July, 2012. Further, Tamil Nadu has a proposal for four-laning of the East Coast Road at a cost of about Rs 4,406 crore, which will be the external linkage for the South Eastern Coastal segment of the proposed ECEC. Additionally, to dovetail the development initiatives of the State Government, the Thoothukudi-Madurai Industrial Corridor, VOC Port Thoothukudi, Chennai Port and Kamarajar Port (Ennore) are complementing their facilities and resources for the projects in the Corridor. For instance, VOC Port has an inner harbour project to increase the present 42.06 MT capacity to 85.49 MT by 2017 with the construction and commissioning of six mechanized berths with a draft of 12.8 m at a total cost of Rs 1,306 crore. The Outer Harbour Project with deep draughts, programmed to be operational in five years has been finalised at a total cost of Rs 23,431.92 crore with an initial investment of Rs 7,241.89 crore in the first phase.
The port project at Colachel, situated close to the international maritime route, has sufficient draught and potential to be developed to handle large ships. The port’s development would propel industrialisation in the district and complement the industrialisation of the proposed Thoothukkudi-Madurai Industrial Corridor.
Further, Tamil Nadu has plentiful talent in skilled manpower, strong infrastructure, sound investment policy and a conducive business environment. TN is already strong in the major industrial sectors, which will give impetus to ECEC objectives.
Tamil Nadu too, has a working relationship with the Centre. In fact, it was only recently that Jaitley had met AIADMK general secretary J Jayalalithaa recently. With immense potential in TN at its door, will the NDA government have a special delivery for the State in the Budget?