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Private firms to develop industrial estates in TN

The micro, small and medium enterprises sector has grabbed the opportunity and there are already proposals for four such facilities

Gireesh Babu  |  Chennai 

Tamil Nadu will soon have industrial estates developed by consortiums of private companies coming up in various parts of the state. The traditional method has been for government agencies to facilitate the development of industrial parks and offer space to industry.

The state government has came up with a model in which a consortium of 20 or more companies in the MSME sector can apply to set up a new industrial estate or shift from existing industrial estates which are facing space constraints, with government support. The micro, small and medium enterprises (MSME) sector has grabbed the opportunity and there are already proposals for four such facilities, according to a top government official.

"If the industry consortium wants to set up new estates, 50 per cent of the cost, up to a ceiling of Rs 10 crore, will be provided by the state government. If a group of firms wants to shift from an existing industrial estate to a new one, especially from locations in the city to the outskirts, 75 per cent of the cost, up to a ceiling of Rs 15 crore, will be provided by the government," said K Dhanavel, secretary in the state's MSME department.

As of now, private sector firms are interested in setting up two such estates in Coimbatore and one each in Madurai and Namakkal. The Namakkal project is also the first such project in which companies from an existing industry cluster in the city will move to a new industrial estate on the outskirts of the city.

The state government is providing Rs 13 crore of the Rs 14 crore cost for the industrial estate in Namakkal. The land for the new estate has also been identified, said the official.

The government has also accepted industry's long-pending demand that 20 per cent of the disposable free land available with the State Industries Promotion Corporation of Tamil Nadu (SIPCOT) be allocated to the Tamilnadu Small Industries Development Corporation Limited (TANSIDCO). SIPCOT is the agency developing industrial estates for large companies, while TANSIDCO develops industrial estates for small enterprises.

Four such estates of Sipcot have been identified as having excess land, and the government has also made it mandatory for any new industrial estate developed by SIPCOT to allocate 20 per cent of the land to TANSIDCO, on a cost-sharing basis.

"We have been requesting the government for such a move. This will help small industries to be located near the larger units, especially when they are supplying to these large firms," said K P Gopal, co-convenor of the Tamil Nadu MSME committee of the Confederation of Indian Industry (CII).

The four places identified for land transfer include SIPCOT estates in Gangaikondan (Tirunelveli district) and in Perundurai (Erode district). In the existing estates, the transfer will be on a cost-sharing basis, with the initial payment made by SIPCOT.

A document prepared by TANSIDCO says it has developed 59 industrial estates on its own since its establishment in 1970, and a total of 94 industrial estates are functioning under its control.

The MSME department is also trying to train more people to meet the increasing requirement of skilled manpower, in collaboration with industry and institutions.

The state government is also in the process of setting up a multi-storeyed industrial estate in Tirumazhisai, outside Chennai, to facilitate built-up infrastructure for micro industries in the state. The facility will come up through an investment of Rs 20 crore. This is expected to help micro enterprises, which are not able to set up their own facilities near Chennai owing to the shortage of land and the increasing cost of both land and construction of infrastructure.

First Published: Mon, January 20 2014. 21:30 IST