A Bill adopted by the Andhra Pradesh Assembly recently, mandating recruitment of local youth in industries and factories, has apparently prompted a few companies there to explore the possibility of relocating to Tamil Nadu. However, the inquiries are still at a preliminary stage.
Claiming that certain companies have sounded out the Tamil Nadu government of their desire to shift their units, a top government official refused to reveal their identities contending it is “premature” to do so. But, he said one of the firms is a major player in the production of renewable energy.
However, when asked if he had come across enquiries being made for relocation of industries from Andhra Pradesh, S. Chandramohan, chairman of the State council of the Confederation of Indian Industry (CII), merely said that those who have gone out of the State are now regretting their decision. They are feeling that “Tamil Nadu is a much better State.” He emphasised that after the Global Investors’ Meet [early this year], the State government has taken “tremendous amount of steps” to ensure that whatever investment committed during the GIM is realised. “There is definitely traction as a result of the GIM,” the CII office-bearer asserted.
On incentives to be provided by the government for industrial projects, the official responded that land can be provided at “concessional rates,” as the State Industries Promotion Corporation of Tamil Nadu (SIPCOT) has a land bank. If the investment is made in southern districts, concessions are made in stamp duty to the extent of 100% and in land cost for 50%. For other districts, the stamp duty concession will be 50%, the official explained.
Even though the launch of Goods and Services Tax (GST) has virtually taken away the ability of State governments to provide fiscal incentives to industries in general, the Tamil Nadu government is offering a scheme of capital incentive to industrial units, subject to certain conditions. In addition, the refund of tax is given for products sold within the State. The authorities are also mulling over the idea of providing some more concessions, using payrolls as a determinant, another official said.
Replying to concerns expressed in certain quarters that the State is losing out to Bengaluru even in the field of manufacturing, the two officials referred to various industrial projects which are being proposed.
Among the projects are industrial parks by GMR in Hosur and Denhanikotta taluks of the Krishnagiri district as well as those of Yanmar, a leading Japanese manufacturer of diesel engines, and Yamaha Music, a musical instrument maker, both in and around Chennai. In the area of information technology, data park projects are also being promoted. Amazon has “evinced interest” in doing business in the State, the officials said.
Not denying that Karnataka does enjoy advantage over other States in the area of software just as Tamil Nadu has been enjoying in automobiles, Mr. Chandramohan, however, said the Tamil Nadu government has been, through IT-connect programme, taking several steps to see to it that the sector’s presence is spread over the State. “In the next six to eight months, you will see a lot of digital governance happening.”
