CHENNAI: The Russia-Ukraine war, recession rumours, lay-offs and Covid-19; the challenges are aplenty. Despite this, Tamil Nadu is set to march towards its goal of a $1-trillion economy in the new year riding on the one crucial factor under its control: building infrastructure.
The Tamil Nadu Industrial Development Corporation is planning to develop six thematic industrial parks to provide a plug-and-play ecosystem for companies planning to expand or set up new industrial facilities related to the aerospace and defence sector.
In 2022, the state government came out with a fresh Aerospace and Defence Industrial Policy with an aim to woo Rs 75,000 crore investment in 10 years. The policy is expected to start attracting investment in the new year, and the state might get facilities that manufacture a range of products from radars to missiles and rockets.
The information technology sector has been one of the sectors in the state which has been showing positive growth as the exports in tier-2 cities like Coimbatore and Madurai increased to 1.09 lakh crore in 2022. In a move that would further boost the sector, the state is set to host Asia’s largest three-day summit on technology and innovation from March 23 to 25, 2023.
The investment projects in southern Tamil Nadu are also expected to see progress with the offshore wind farms and India’s largest Hydrogen plant which is coming up in Thoothukudi.Ami dst reports of Apple instructing three of its biggest vendors Foxconn, Pegatron and Wistron to increase production capacity in India, Chennai may get a lion’s share of the investments. SIPCOT has taken up the ambitious project to build houses for 19,500 workers of Foxconn on 30.83 acres in SIPCOT Vallam Vadagal Industrial Park. The first phase of the housing project is expected to be completed in 2023.
Foxconn is setting up a manufacturing project with an investment of Rs 2,500 crore in six years. It is estimated to provide 25,000 direct and outsourced jobs within the project site. In the automobile sector, the closure of Ford may be a big setback. However, the industry is pinning hopes on growth in the electric vehicle segment. Among the sectors that would need more support from the government in 2023 is textile. According to figures available with TNIE, the exports of cotton yarn, fabrics, and handloom products are in the red, showing a fall of 20.81% from April 2022 to November 2022, compared to the same period last year.
It is learnt that in November alone, the fall was 28.10%, the reason being, export orders from two big global markets, the United States and Europe, have been shrinking. “Many of the mills are working only single shift instead of the usual three shifts,” said former president of Tiruppur exporters association Raja Shanmugham. “We are not getting any orders. The US inventory has piled up as they went on a buying spree.”
Shanmugham claimed the impact on the textile sector has had a cascading effect with the imports of dying, tanning and colouring materials falling by 12.88%. He appealed to the union government to handhold the textile sector, particularly the MSMEs, in the new year to sail the tide until the global markets pick up.
The footwear exports, too, slowed down in 2022, but not as poorly as the textiles.
How things play out in 2023 will depend on the situation in China, which was hit by Covid-19. Former regional chairman Federation of Indian Exports Organisation, Israr Ahmed, said so far, the impact was minimal. “We haven’t seen China shutting down its ports as it was done earlier when there was fear of a pandemic. It is learnt workers are getting back to work within four days after being infected with the virus,” he added.