Economy of Tamil Nadu
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[edit] Macro-economic trend
This is a chart of trend of gross state domestic product of Tamil Nadu at market prices estimated[1] by Ministry of Statistics and Programme Implementation with figures in millions of Indian Rupees.
| Year | Gross State Domestic Product |
|---|---|
| 1980 | 80,810 |
| 1985 | 156,481 |
| 1990 | 313,390 |
| 1995 | 782,050 |
| 2000 | 1,411,000 |
Tamil Nadu's gross state domestic product for 2004 is estimated at $56 billion in current prices. Possessing the fifth largest economy (2004-2005) among states in India, Tamil Nadu is also the second most industrialised state next to Maharastra.[2] It ranks second in per capita income (2004-2005) among large states. It ranks third in foreign direct investment approvals (cumulative 1991-2002) of Rs.225,826 million ($5,000 million), next only to Maharashtra (Rs.366,024 million ($8,100 million)) and Delhi (Rs.303,038 million ($6,700 million). The State's investment constitutes 9.12% of the total FDI in the country.[3] Unlike many other states, the economic resources are quite spread out, rather than concentrated in a small industrialised area.
According to the 2001 Census, Tamil Nadu has the highest level of urbanization (43.86%) in India, accounting for 6% of India’s total population and 9.6% of the urban population.[4] and is the second most industrialized state in India.[5] Tamil Nadu has a network of about 110 industrial parks and estates offering developed plots with supporting infrastructure.[6] Also, the state government is promoting other industrial parks like Rubber Park, Apparel Parks, Floriculture Park, TICEL Park for Biotechnology,[7] Siruseri IT Park, and Agro Export Zones among others.
Annual Plan outlays have increased by a record 75% from Rs.52,000 million ($1,100 million) in 2001-2 to Rs.91,000 million ($2,000 million) in 2005-6.
[edit] Agriculture
Tamil Nadu has historically been an agricultural state, while its advances in other fields launched the state into competition with other areas. Even so, Tamil Nadu is a leading producer of agricultural products in India. Tamil Nadu agriculture is heavily dependent on the river water and Monsoon rains. The perennial rivers are Palar, Cheyyar, Ponnaiyar, Kaveri, Meyar, Bhavani, Amaravati, Vaigai, Chittar & Tamaraparani. Non-perennial rivers include the Vellar, Noyal, Suruli, Gundar, Vaipar, Valparai and Varshali. Tamil Nadu is also the leading producer of kambu, corn, rye, ground nuts, oil, seeds and sugar cane in India.
At present Tamil Nadu is India's second biggest producer of rice, next to Punjab where there is perennial source of irrigation.[8] Tamil Nadu is the home to Dr. M.S. Swaminathan, known as the "father of the Green Revolution" in India.[9] The town of Namakkal is also known as the Poultry hub of India.
A technological and industrial park (designated as a Special Economic Zone) was originally planned to be set up in Nanguneri, in the Tirunelveli district with an investment of Rs. 6,000 crores (US$ 1.6 billion). However, recently developmental plans point to a re-orientation of this project to Tuticorin.
[edit] Industry and manufacturing
One of the global electrical equipment public sector company BHEL has manufacturing plants at Tiruchirapalli and Ranipet. The Tamil Nadu state government owns the Tamil Nadu Newsprint and Papers (TNPL),[10] the world's biggest bagasse based Paper mills in Karur as well as the world's sixth largest manufacturer of watches together with TATA, under the brandname of "Titan".[11] 55% of all wind-generated electricity in India is created by windmills in Tamil Nadu. Renowned Danish wind power company NEG Micon has established its manufacturing unit in Chennai.[12] Tamil Nadu is leading producer of Cement in India, it is the home for leading cement brands in the country such as Chettinad Cements(Karur), Dalmia Cements Ariyalur, Ramco cements (Madras Cement Ltd), etc.,There is a ACC cement factory located in madukarai outskirts of Coimbatore.
Many heavy engineering and manufacturing-based companies are centered in and around the suburbs of Chennai (nicknamed, "The Detroit of Asia"). Chennai boasts the presence of global vehicle manufacturing giants like Ford, Renault, Nissan, Caterpillar, Hyundai, BMW and Mitsubishi as well as domestic heavyweights like MRF, TI cycles of India, Ashok Leyland, Royal Enfield, Mahindra & Mahindra, TAFE Tractors and TVS. Everything from automobiles, railway coaches, battle-tanks, tractors, motorbikes and heavy vehicles are manufactured in Tamil Nadu. A large number of textile mills and engineering industries are present around Coimbatore City. Karur is known for its bus body building industries where most of the buses used in south India are manufactured. Over 11.2% of the S&P CNX 500 conglomerates have corporate offices in Tamil Nadu.
The Kalpakkam Nuclear Power Plant, Ennore Thermal Plant, Neyveli Lignite Power Plant,Vriddachalam Ceramics and the Narimanam Natural Gas Plants are major sources of Tamil Nadu's electricity. It is presently adding the Koodankulam Nuclear Power Plant to its energy grid. Tamil Nadu sources a significant proportion of its power needs from renewable sources with Wind Power contributing over 2000 MW or over 20% of the needs. As of 2005, Tamil Nadu is one of the few Indian states with surplus power electricity, enabling the electrical authority to sell it to neighbouring states of Andra Pradesh & Karnataka. India's leading steel producer SAIL has a steel plant in Salem, Tamilnadu.[13] Tamil Nadu ranks first nationwide in diesel-based thermal electricity generation with national market share of over 34%.
The Mettur Dam is a large dam in India. It was completed in 1934. The total length of the dam is 1700 meters. It is also called Stanley Reservoir. The Mettur Hydro Electrical power project is also quite large Mettur Dam. Mettur has a number of industries (50 km from Salem city): SISCOL,[14] MALCO (Madras Aluminium Company owned by Vedanta Resources), Chemplast (former known as Mettur Chemicals),[15] Thermal power plant, Hydel power plant and huge number of chemical industries.
The textile industry plays a significant role in the Indian economy by providing direct employment to an estimated 35 million people, and thereby contributing 4% of GDP and 35% of Gross Export Earnings. The textile sector contributes to 14% of the manufacturing sector. The city of Tirupur (Coimbatore district), in Tamil Nadu is the largest garment exporter in India and sometimes referred to as Textile valley of India. In 2004, the export turnover from the town was more than Rs.50,000 million ($1,100 million). Some 7,000 garment units in the town provides employment opportunity to 1 million people. 56% of India's total knitwear exports come from Tirupur. The Export Import Policy of 2002-2007 acknowledges Tirupur for its contribution to the export efforts. Next to Tirupur, the town of Karur generates around $300 million a year in foreign exchange through home textile exports such as bed linens, kitchen linens, toilet linens, table linens and wall hangings. Madurai and Kanchipuram is very famous for handloom sarees. This handloom sarees are on sale all over India. Tamilnadu, Karnataka, and Kerala are the main states for wholesale sarees. This sarees manufacturing raw materials are purchased from Salem and Coimbatore.[16]
Electronics manufacturing is a growing industry in Tamil Nadu. Companies like Nokia, Flextronics, Motorola, Foxconn and Dell have chosen Chennai as their South Asian manufacturing hub. Products manufactured include circuit boards and cellular phone handsets.[17] Ericsson also has a Research and Development facility in Chennai.[18]
The town of Sivakasi is a leader in the areas of printing, fireworks, and safety matches. It was fondly called as Kutty Japan or "little Japan" by Jawaharlal Nehru. It contributes to 80% of India's production of safety matches as well as 90% of India's total fireworks production. Sivakasi provides over 60% of India's total offset printing solutions and ranks as one of the highest taxpaying towns in India. Sivakasi also is a 100% employed town, putting it in the company of very few towns in India.
- See also: List of conglomerates in Tamil Nadu
[edit] Mining
This is a chart of proven reserves of major minerals of Tamil Nadu[19] in 2001 by Department of Geology and Mining with figures in tonnes.
| Mineral | Reserve | National Share |
|---|---|---|
| Lignite | 30,275,000 | 87% |
| Vermiculite | 2,000,000 | 66% |
| Garnet | 23,000,000 | 42% |
| Zircon | 8,000,000 | 38% |
| Graphite | 2,000,000 | 33% |
| Ilmenite | 98,000,000 | 28% |
| Rutile | 5,000,000 | 27% |
| Monazite | 2,000,000 | 25% |
| Magnesite | 73,000,000 | 17% |
[edit] Energy production
The Tamil Nadu Energy Development Agency (TEDA) is a Tamil Nadu government promoting renewable energy sources and energy conservation activities. The agency has largely been responsible for instigating the tremendous growth of Tamil Nadu in the development of wind power.[20] Tamil Nadu is in the forefront of all other Indian states in installed capacity.[21]
The once-impoverished village of Muppandal benefited from the building of the nearby Muppandal wind farm, a renewable energy source, supplying the villagers with electricity for work.[21][22]
Wind farms are being built along the 19 km road between Muppandal and Kanyakumari, a town lying between the Bay of Bengal, the Arabian Sea and the Indian Ocean. These areas generate about half of India's 2,000 megawatts of wind energy or two percent of the total power output of India.[23]
Tamil Nadu at this time is the only state to have a formal Bio-Diesel Policy to use jatropha crops as a source of biofuel and to distribute wasteland to the poor farmers for the planting of these crops.[24]
[edit] Transportation
Tamil Nadu has a well established transportation system that connects all parts of the state. This is partly responsible for the investment in the state. Though the present transportation system is substantial, it needs to be developed further to keep pace with the rapid increase in use. Tamil Nadu is served by an extensive road network in terms of its spread and quality, providing links between urban centers, agricultural market-places and rural habitations in the countryside. There are 24 national highways in the state, covering a total distance of 2,002 km.[25] The state is also a terminus for the Golden Quadrilateral project that is scheduled to complete in 2008. The state has a total road length of 167,000 km, of which 60,628 km are maintained by Highways Department. This is nearly 2.5 times higher than the density of all-India road network.[26] It is currently working on upgrading its road network, though the pace of work is considered slow.[27]
Tamil Nadu has a well developed rail network as part of Southern Railway. Headquartered at Chennai, the present Southern Railway network extends over a large area of India's Southern Peninsula, covering the states of Tamil Nadu, Kerala, Pondicherry, a major portion of Karnataka and a small portion of Andhra Pradesh. Tamil Nadu has a total railway track length of 6,693 km and there are 690 railway stations in the state. The system connects it with most major cities in India. Main rail junctions in the state include Chennai, Coimbatore, Madurai and Tiruchirapalli. Chennai has a well-established Suburban Railway network and is in the process of developing a metro.
Tamil Nadu has a major international airport, Chennai International Airport, that is connected with 15 countries with more than 60 direct flights every week. This is currently the third largest airport in India after Mumbai and Delhi. It also has domestic airports at Coimbatore, Trichy, Tuticorin and Madurai make several parts of the state easily accessible. Increased industrial activity has given rise to an increase in passenger traffic as well as freight movement which has been growing at over 18 per cent per year.[28]
Tamil Nadu three international ports at Chennai, Ennore and Tuticorin, two of them major all-weather ports, Chennai and Tuticorin, as well as two intermediate and six minor ports all of which are currently capable of handling over 73 million metric tonnes of cargo annually (24 per cent share of India). Chennai Port is an artificial harbour situated on the Coromandel Coast in South-East India and it is the second principal port in the country for handling containers. The volume of cargo in the ports grew by 13 per cent over 2005.[29][30] The Sethusamudram Shipping Canal Project will transform the Tuticorin port into a transhipment hub similar to those in Singapore and Colombo.
[edit] Services
Tamil Nadu has with more than 250, the most engineering colleges in India.
This is a chart of trend of software exports from Tamil Nadu published by ELCOT (Electronics Corporation of Tamil Nadu Ltd.) with figures in millions of Indian Rupees.[31]
| Year | Software Exports | Software Companies |
|---|---|---|
| 1995 | 370 | 34 |
| 2000 | 31,160 | 766 |
| 2005 | 141,150 | 1,427 |
Chennai is the second leading software exporter in India, after Bangalore. India's largest IT park is housed at Chennai. Software exports from Tamil Nadu rose from Rs.76,000 million ($1,600 million) in 2003-04 to Rs.110,000 million ($2,400 million) in 2004-5.[32] Chennai is a hub for e-publishing, as there are 47 e-publishing units registered with the STPI in Chennai and 25 in Bangalore. Companies such as HCL, Wipro, TCS, Satyam, Infosys, Cognizant Technology Solutions, Covansys, Ford Information Technology, Xansa, Verizon, iSoft, iNautix, Electronic Data Systems, Bally and many others have offices in Chennai. Infosys Technologies has set up India's largest software development centre to house 25,000 software professionals at an estimated investment of Rs.12,500 million ($270 million) in Chennai.[33] India's largest IT park is housed at Chennai, jointly made by Ascendas India Ltd, a Singapore-based company engaged in providing business space solutions, and Tamil Nadu Industrial Development Corporation (TIDCO).[34]
Business Process Outsourcing Services:
Chennai is now emerging as the most preferred destination for high-end BPOs in financial services, healthcare and other back-office services for multinational companies. Companies like Congruent Solutions (back-end services for California-based retirement funds), Secova eServices (HR service provider for US clients), Lason India (data processing for healthcare and financial services clients in the US) and OfficeTiger (outsourcing of creative works) have set up centres here to take advantage of Chennai's "quality talent pool and infrastructure". Stanchart, eServe (Citibank),ABN AMRO and World Bank have also chosen the city for their back-office functions.[35]
In the recent surveys, Chennai has been rated as the most attractive city for Offshoring Services.[36]
Knowledge Process Outsourcing:
Chennai is also the preferred destination for companies outsourcing their high-end knowledge intensive operations. Testimony to this is the presence of major market research companies such as Frost & Sullivan and equity research companies such as Irevna in Chennai. This is the next high growth area that Chennai is witnessing.
[edit] Revenues of Government
Tamil Nadu ranks second nationwide of all State governments in tax revenue. (See: States of India by tax revenues.) This is a chart of trend of tax revenues (including the shares from Union tax pool) extracted from the Consolidated Fund of the Government of Tamil Nadu[37] with figures in millions of Indian Rupees. See also the Finance Commission of India report.[38] Tax revenues of local bodies are excluded.
| Year | Tax Revenues | Sales Tax | Excise Duties | Registration Fees | Corporation Tax | Vehicle Tax |
|---|---|---|---|---|---|---|
| 1950 | 441[39] | |||||
| 1955 | 270 | 112[40] | 3 | 7 | ||
| 1960 | 417 | 191 | ||||
| 1965 | 723 | 409 | 4 | 99[41] | 133 | |
| 1970 | ||||||
| 1975 | 3,190 | |||||
| 1980 | ||||||
| 1985 | ||||||
| 1990 | 34,508 | 20,659 | 4,348 | 2,263 | 2,273 | |
| 1995 | 79,045 | 46,892 | 9,346 | 6,130 | 3,922 | |
| 2000 | 150,659 | 81,971 | 18,686 | 9,101 | 5,904 | |
| 2005 | 253,232 | 143,607[42] | 24,780 | 15,628[41] | 13,846 | 11,305 |
This is a chart of trend of non-tax revenues and grants-in-aid extracted from the Consolidated Fund of the Government of Tamil Nadu with figures in millions of Indian Rupees. See also [1] and [2]. Non-tax revenues of local bodies are excluded.
| Year | Non-tax Revenues | Interest | Mining | Grants-in-Aid |
|---|---|---|---|---|
| 1960 | 197 | 114 | ||
| 1965 | 466 | 233 | ||
| 1970 | ||||
| 1975 | ||||
| 1980 | ||||
| 1985 | ||||
| 1990 | 3,814 | 897 | 588 | 12,555 |
| 1995 | 8,584 | 3,428 | 672 | 18,362 |
| 2000 | 17,107 | 4,036 | 3,953 | 15,398 |
| 2005 | 21,014 | 5,673 | 4,274[40] | 28,268 |
[edit] See also
[edit] Notes
- ^ National Accounts Division : Press release & Statements. Government of India. Retrieved on 2006-08-16.
- ^ Ranking of states
- ^ Tamil Nadu ranks third in FDI, favoured destination
- ^ e-CENSUSIndia. CensusIndia.net. Retrieved on 2006-08-16.
- ^ World Bank Supports India's Urban Development
- ^ Example include Tidelpark and ITP Chennai
- ^ TICEL Park for Biotechnology
- ^ Government Policy Notes
- ^ M. S. Swaminathan Research Foundation
- ^ TNPL
- ^ Titan Website
- ^ Vestas Webpage
- ^ SAIL Plant
- ^ Southern Iron and Steel Company
- ^ Chemplast Sanmar Ltd
- ^ Tirupur:India's Textile Valley
- ^ Flextronics signs pact for Chennai facility
- ^ Ericsson India Private Ltd
- ^ An overview of Mineral Reserves. Government of Tamil Nada. Retrieved on 2006-08-16.
- ^ TEDA catalyses renewable energy sector growth in Tamil Nadu. Retrieved on 2006-10-28.
- ^ a b Tapping the Wind - India (February 2005). Retrieved on 2006-10-28.
- ^ Watts, Himangshu (November 11 2003). Clean Energy Brings Windfall to Indian Village. Reuters News Service. Retrieved on 2006-10-28.
- ^ Wind power boosts Southern Indian economy. Aljazeera.net (November 2 2003). Retrieved on 2006-10-28.
- ^ Clean Green Energy from Tamil Nadu, India. Retrieved on 2006-11-15.
- ^ Economy and Business in Tamil Nadu
- ^ Official site for Tamil Nadu Highways
- ^ Highways, roads to be upgraded in Tamil Nadu
- ^ Transportation in Tamil Nadu
- ^ Official website for Ennore Port
- ^ Official website for Tuticorin Port
- ^ Status of IT industry in Tamil Nadu. ELCOT. Retrieved on 2006-08-16.
- ^ Exports in software likely to increase
- ^ Infosys setting up giant centre in Chennai
- ^ India's largest IT park at Chennai to have world-class workplace facilities
- ^ Chennai becomes most preferred BPO hub
- ^ Chennai most attractive city for offshoring services
- ^ Tax Revenue Receipts (PDF). Tamil Nadu Government. Retrieved on 2006-08-16.
- ^ Finance Commission Report. Finance Commission of India. Retrieved on 2006-08-16.
- ^ includes the province of Hyderabad
- ^ a b includes revenues from non-ferrous mining and metallurgical industries
- ^ a b includes stamp fees
- ^ includes tax on trades
