 "Rs 1500 cr loss: State mourning for Jayalalithaa hits business hard in Tamil Nadu")
Tamil Nadu is estimated to have suffered a loss of about Rs 1,500 crore on Tuesday, as industries and businesses in the state remained shut in the wake of the demise of former chief minister J Jayalalithaa late and a statewide seven-day mourning announced thereafter.
Production at every automotive facility, offices of information technology firms and retail establishments in the state remained shut on Tuesday as a mark of respect to the late chief minister.
Tamil Nadu plays host to a dozen-odd automotive companies engaged in manufacturing of motorcycles, cars, sports utility vehicles, luxury sedans, trucks, buses, construction equipment and tractors.
Ford, Hyundai, Renault, Nissan, BMW, Royal Enfield, TVS Motor, Ashok Leyland, Daimler India Commercial Vehicles, Kamaz Vectra, Mitsubishi, Yamaha, TAFE, Caterpillar are some of the original equipment makers.
Chennai has an installed capacity to produce, 1,380,000 cars and 361,000 commercial vehicles per annum. In other words, the city has a capacity to produce three cars every minute and one commercial vehicle every 75 seconds. Besides, there are scores of auto component makers supplying to these OEMs. An estimated Rs 1,000 crore was lost on Tuesday on account of the unscheduled closure of business. Automotive dealers and regional transport offices also remained shut.
While the Centre declared a one-day (Tuesday) national mourning, Tamil Nadu announced that the state would mourn for seven days for Jayalalithaa.
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Although there has not been any untoward incident reported anywhere in Tamil Nadu at the time of going to press, all companies, however, have decided to wait and watch.
Sumit Sawhney, country chief executive and managing director, Renault India, said: “We had to keep the plant shut today (Tuesday) but about tomorrow (Wednesday) we really can’t say anything at the moment. By late evening, we’ll get to know what the situation looks like.”
There was violence outside the Apollo hospital in Chennai early on Monday night after unconfirmed news broke out about the death of Jayalalithaa. This was a few hours before the hospital issued an official release about her death past midnight.
“We will take a call after assessing the law and order situation on Wednesday. If everything is peaceful tonight (Tuesday night) after cremation (of Jayalalithaa), then we can open production tomorrow (Wednesday),” said a senior official of an SUV manufacturer.
Information technology and related services companies, which collectively employ around 400,000 people in Tamil Nadu in more than 600 companies, remained shut on Tuesday.
Retail shops across the state too decided to down shutters. At Chennai's popular retail hub T.Nagar, which is one of the largest in the country, shops were closed since Monday evening. This hub does a business of around Rs 100-200 crore a day according to estimates.
Jayalalithaa's term saw some big ticket investments in the state with over $20 billion of foreign direct investment. During last year Global Investors Summit, over Rs 2.43 lakh crore worth of investments were signed by the state.
Department of Industrial Policy and Promotion data shows that from April 2000 to March 2011 has seen Foreign Direct Investment (FDI) inflow of $7.3 billion and from April 2011 to December 2015 it climbed to $13.94 billion. Between a short period of April 2015 to December 2015, the state has attracted $4.3 billion FDI, it claimed.