TN govt to create venture fund for entrepreneurs

The govt has set aside Rs 100 cr for MSMEs in the jute industry. The number of such units in Tamil Nadu is the largest among all states in the country, accounting for 15.07 per cent of the national total

The Tamil Nadu government is planning to create a venture capital fund with the support of private industries and foreign investors for the Entrepreneurship Development Institute (EDI) in the state.

O Panneerselvam, the state finance minister, who presented the interim budget last week, said that the EDI will also create a corpus fund by pooling resources from financial institutions, and the state and Central governments.

The EDI will be revamped to motivate and train young entrepreneurs, particularly first generation entrepreneurs, he said.

Speaking about sectoral development in the state, Panneerselvam said the state had set a target of developing 50 clusters in the 11th Five Year Plan. The state’s Small Industries Development Corporation Ltd (Sidco) has identified 2,256 acres in 25 locations to promote industrial clusters for micro, small and medium enterprises (MSME) in the coming years.

Besides, the government has also set aside Rs 100 crore for micro and small units in the jute industry. The number of MSMEs in Tamil Nadu is the largest among all states in the country, accounting for 15.07 per cent of the national total.

In the 11th Plan it is proposed to develop 50 clusters under the Cluster Development Programme to promote micro and small enterprises. Fifteen clusters have been taken up so far and nine clusters are proposed to be taken up in 2011-12.

“Depending on the suitability, the land available in the defunct co-operative spinning mills will be utilised for setting up new industrial estates to promote industries in the MSME sector and generate employment opportunities,” said the finance minister.

In 2011-12, Sidco has proposed to take up infrastructure works in seven new industrial estates at a cost of Rs 23.50 crore and upgrade infrastructure facilities in eight industrial estates at a cost of Rs 27.49 crore.

The activities of Sidco will be revamped by reviewing the land pricing policy, creating land banks and simplifying procedures. At present, Sidco is giving a 15 per cent capital subsidy to promote the MSME sector.

“We will examine ways to give additional incentives to encourage investments under the MSME sector. As a first step, the Tamil Nadu Industrial Investment Corporation (TIIC) will provide credit to micro, small, and medium industries with three per cent interest rebate,” Panneerselvam said.

The government will also promote export-oriented coir and jute based industries with credit and technology support with a total outlay of Rs 100 crore in 2011-12.

To address the human resources issue, the state government is planning to set up 10 new ITIs in the state. At present there are 62 government-run ITIs in Tamil Nadu. With the demand for skilled workers growing strongly in the state, there is an urgent need to start more ITIs.

The Confederation of Indian Industry’s report on Tamil Nadu has estimated that, by the year 2015, the state’s incremental skilled manpower requirement will be about 13-15 millions. The main drivers of this demand will be the manufacturing, textiles, automotive, retail, information technology, electronics and banking and financial services sectors.

Once the EDI is revamped, new courses will be introduced with the help of industry partners. Its new features will include a modern training complex with smart class rooms, a library, a computer centre, an auditorium and hostel facilities, to be created at a cost of Rs 4 crore.