The Tamil Nadu government’s plans to unveil separate policies for textiles, IT/ITeS, Aerospace & Defence and Micro, Small and Medium Enterprises will spur innovation and increase investment, feel industry experts. But the government should stick to its timeline of 30 days to provide clearances, many industry members say.
“The new IT policy with a focus on technology, start-ups, skilling would bring in much more attention from the investor community to look at Tamil Nadu much more seriously,” K Purushothaman, Regional Director, Nasscom, said.
A ‘10K Warehouse’ that is being set up by Nasscom facilitated by the State government at Tidel Park is likely to benefit from the new IT policy that could help Chennai compete with start-up hubs like Bangalore, he said.
The aerospace policy could help bring in players from the automotive sector in to the aerospace industry in Tamil Nadu and the Chennai Aerospace Park. “We have suggested some changes to the draft since most of the aerospace industry consists of small and medium enterprises. The policy will reduce entry barriers for newcomers into the industry. Aircraft interiors is a huge market,” Venkatesh Chandrasekaran, Director, VinMn Aerospace Pvt Ltd, said.
“The aerospace industry spends a lot of money on skilling workers. The industry is discussing with the government for providing concessions on skilling. Also, the cost of certification in the aero industry is very high. We have requested for a subsidy for reimbursement of the certification cost,” he said.
The new textile policy is also likely to introduce suitable tax concessions and a single window system for the approval of the investment proposals in the sector. However, industry members who did not wish to be identified, were skeptical about Chief Minister Jayalalithaa’s announcement that statutory clearances for projects will be done in 30 days.
“There is a lack of commitment for a specific date from government agencies, especially when it comes to infrastructure development. Companies raise money to invest in projects through equities or bank loans. What happens if the government doesn’t do what they say in a 30-day timeframe? We end up paying huge penalties to the banks or investors. If there is a default, the government should take accountability and compensate if there is a delay on their part,” an industry captain said.
In an interview to The Hindu at the Global Investors Meet, Muneo Kuruachi, Chairman of the Standing Committee of Japan-India Business Co-Operation Committee, said it was still difficult for foreign companies to invest in India and Tamil Nadu due to bureaucratic hurdles.
