As a direct fallout of some of the most famous names in automobile business setting up shop in Tamil Nadu, a plan has been chalked out by the state government to establish an auto ancillary park near Chennai.
The park is being set up jointly by Tamil Nadu Industrial Development Corporation (Tidco) and Mahindra & Mahindra with a total investment of Rs 3,000 crore.
The details of the financing plan are still being worked out, but a senior executive of Mahindra & Mahindra told Business Standard that the company was likely to pick up 90 per cent of the total equity, while Tidco would hold the rest.
Land has already been acquired for the park, which would come up over 1,400 acres south of Chennai near the Mahindra-Ford complex. Tamil Nadu industry secretary S Srinivasan told Business Standard that as many as 75 auto component units had sought permission to set up shop in the park.
According to Srinivasan, allotment of space would start around the middle of February.
The decision to set up the auto ancillary park was motivated by the fact that many of the biggest automobile companies in the world -- such as Hindustan Motors-Mitsubishi, Mahindra-Ford India, Hyundai India -- have already established facilities in Tamil Nadu.
These automobile companies are being followed by auto component makers from the foreign partner's country. For example, 17 auto component makers of South Korea are said to be coming to India tracing the footsteps of Hyundai.
Srinivasan would go as far as to say that Tamil Nadu was set to emerge as Detroit of south-east Asia.
The state already accounts for 35 per cent of the total auto components produced in the country, 27 per cent of heavy commercial vehicles, 46 per cent of mopeds, 13 per cent of motor cycles and 49 per cent of railway coaches.
It also boasts of a 25 million-strong work-force, 9 million industrial work-force and harmonious industrial relations with less than 0.5 per cent mandays lost on account of industrial relations. It also has 138,472 kilometres of surfaced roads, the second most among the states.
The state level incentives to industry being offered by Tamil Nadu include investment subsidies of $28,000 to $280,000, deferment or waiver of sales tax for five to 14 years, and power tariff concessions.
Other carrots being dangled by the state are pro-active government policies, investor-friendly and transparent decision-making, sound and diversified industrial infrastructure, comfortable power situation, abundant skilled manpower, quality of life and work, harmonious industrial relations, investor incentives and highly-evolved commercial culture and institutional support.
