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Despite reports that Tamil Nadu is losing out on industrial investments due to political uncertainities, the state has seen the value of investment proposals hit a four-year high, with a potential investment pipeline of Rs 19,033 crore, according to a research by real estate consultant JLL India. The state has seen over 46 investment proposals worth a cumulative Rs 37,381 crore since 2015, it said.
Following the Global Investors Meet held in September 2015, Tamil Nadu was initially not very active in promoting industrial investment. However, the Department of Industries and Guidance and Export Promotion Bureau are now diligently engaging with industries from across the globe who are willing to set up shop in the state.
"The resulting employment commitment from industries is over 30,000 direct jobs in the semi-skilled, skilled and unskilled categories. Apart from industrial activities, the logistics and warehousing industry is extremely upbeat in the state and keeping the market active," the report added.
Chennai is one of the top 10 global automotive clusters and the sector continues to attract interest from various automotive ancilliary units. Large original equipment manufacturers (OEMs) are insisting that their suppliers set up their facilities near their plants to enable them to maintain inventory support for just-in-time production, it said.
The state government has worked with the Department of Industrial Policy and Promotion (DIPP) and the Ministry of Commerce and Industry on a series fo measures to simplify the restration and inspection.
DIPP, in collaboration with the World Bank, released the Business Reform Action Plan (BRAP) 2017, which includes 405 recommended reforms on regulatory processes, policies, practice and procedures across 12 areas.
The Business Reform action plan relates to 13 departments of the government of Tamil Nadu. The Guidance Bureau has been entrusted with the task of implementing this action plan in coordination with concerned departments.
Land parcels from government sources such as the Sipcot industrial complexes around Chennai, are almost fully occupied, and there are now very few smaller plots available for industries. In the case of aggregation of larger land parcels of over 30-100 acres, considerable complexities in terms of legal title and other technical aspects of land acquisition are inevitable. Land aggregators such as G Square are helping industry majors Murugappa Group, JK Tyres and units in the TVS Group acquire requisite land parcels for setting up manufacturing units.
The report also elaborates that the government of Tamil Nadu is following an institutional mechanism for improving the business environment for Japanese companies in the state, considering that Tamil Nadu is home for around 600 companies from that country. Chennai accounts for two per cent of all Japanese companies operating in India.