Tamil Nadu retains its investment destination status in 2022, with investments of Rs 1 lakh crore

Tamil Nadu, a popular investment destination, managed to attract over Rs 1 lakh crore in investments from various industries in 2022, a year that brought both problems and possibilities to the southern state.

It encountered difficulties as a result of many events such as the Russia-Ukraine crisis or the halt of production at the nearby US automaker Ford, among others.

This year, Tamil Nadu inked memorandums of understanding with over 60 companies, which agreed to investing Rs 1.25 lakh crore and creating over 75,000 new employment.

Chief Minister M K Stalin has been reaching out to investors on a variety of venues in order to make Tamil Nadu the most appealing investment destination in South Asia and to promote 'Made in Tamil Nadu' products throughout the world.

The government also claimed that Tamil Nadu was the only state in the country to see 'positive growth' during the Covid-19 enforced shutdown, while the rest of the country experienced negative growth.

According to the Industry Department, Tamil Nadu is India's second largest state economy, accounting for 9.47 percent of GDP in fiscal 2020-21. The economy recovered in 2021-22, with the Gross State Domestic Product (GSDP) rising from Rs 19.02 lakh crore to Rs 21.79 crore.

Aside from its many policy measures, the administration announced the establishment of a Rs 20,000 crore greenfield airport at Parandur in order to boost the state's economy. It has a yearly capacity of 10 million passengers. The airport, which is slated to open in 2029-30, will contain two runways, a terminal building, taxiways, an apron, a freight terminal, and other amenities.

To achieve the lofty USD 1 trillion economic target by FY 2030-31, the government has devised a number of measures, including attracting Rs 23 lakh crore in manufacturing investments and creating 46 lakh new employment.

An official stated that in order to reach the USD 1 trillion GDP, the manufacturing sector must take centre stage in economic development.

According to the official, Tamil Nadu is a manufacturing hub in the country because of its significant presence in sectors such as automobiles and auto-components, including electric vehicles, textiles and wearing apparel, leather, chemicals, including rubber and plastic, electronics, machinery, and fabricated metal products.

In terms of exports, Tamil Nadu contributed for 8.40% of total national exports, with Rs 1.90 lakh crore shipped outside.

The Guidance Bureau, a nodal body for promoting investments in the state, has been working to improve the single window site to provide a more smooth experience for investors.

To promote the growth of these industries, the government has been working on new policies such as life sciences promotion policy, research and development policy, leather and footwear policy, and improving the existing electric car policy.

The government has ensured the construction of a big scale furniture park, the first of its type, in the SIPCOT industrial park in Tuticorin at a cost of Rs 1,000 crore.

The Rs 3,500 crore investment promise from Dubai-based Lulu Group was another investment milestone achieved in 2022.

An E-vehicle park and future mobility park are also in the works, with SIPCOT investing Rs 167.30 crore to create the former on over 300 acres of land in Manallur.

SIPCOT also intended to develop a Future Mobility Park on 300 acres of land in Shoolagiri, Krishnagiri district, at a cost of Rs 300 crore, to encourage environmentally, sustainable, and technological transportation options.

According to Saurav Kumar, founder and CEO of electric car manufacturer Euler Motors, 2022 has demonstrated that EVs are the future of mobility.

In every segment category, whether two wheelers or commercial, there is demand and customer willingness for an electric transition across places — retail and institutional in every segment category, he said in a statement.

As part of a'restructuring exercise,' Ford Motors, headquartered in the United States, decided to cease production at its TN plant this year.

While Ford reached the decision in September 2021, the procedure, which was supposed to complete by March 31, 2022, only ended on September 30 due to labour unrest throughout the period.

The approximately 2,000 employees went on strike, saying that the company's severance compensation was insufficient.

Ford rolled out the final product, the sports utility vehicle (SUV) EcoSport, from the manufacturing lines at the factory located about 45 kilometres away in July.

While Ford had planned to produce electric vehicles in the site, the project was'shelved' despite getting government approval for production-linked incentives.

According to a CII-KPMG report, IT companies in Tamil Nadu are focusing heavily on Metaverse and Web 3.0 technologies in order to help the state reach the USD 1 trillion GDP.

According to the paper, Metaverse, Web3.0, and associated technologies would assist Tamil Nadu in achieving the overall gross state domestic product.

T Mano Thangaraj, Minister of Information Technology and Digital Services, has stated that the government should develop a policy on Global Capability Centres.

The GCC policy follows similar policy pronouncements by the government, including policies on cyber security, safe and ethical artificial intelligence, and IT policy, among others.

In the banking sector, Tamil Nadu-based public sector Indian Bank and Indian Overseas Bank reported higher results in 2022 than in 2021, which was hampered by the COVID-19 pandemic.

Indian Bank recorded a 13% increase in net earnings for the July-September period, at Rs 1,225 crore, compared to Rs 1,089 crore in the same period last year.

Indian Overseas Bank increased its net income by 33.2 percent to Rs 501 crore during the July-September period.

Suguna Group chairman B Soundararajan of Coimbatore remarked of the poultry industry's success, "we have found that the consumption pattern of consumers has slowly evolved from food security to nutritional security with an enhanced awareness towards protein consumption."

The year 2022 was good for the poultry industry as a whole. Every year, the poultry business in India produces and consumes 600 billion eggs and six million tonnes of chicken meat, according to him.

"By 2023, we expect significant advancements in the poultry business, as well as greater consumption and adaptability of processed meat in India," he said.