Tamil Nadu has attracted new investment proposals of over Rs 4 trillion in the last four years, helping the state generate over 50,000 new direct employment opportunities, according to the study conducted by the MSME Export Promotion Council (EPC), in association with the Confederation of Organic Food Producers & Marketing Agencies.
Releasing the study on Investment: Growth & Development in Tamil Nadu, the chairman of the MSME EPC, DS Rawat, said a significant number of projects are in the manufacturing sector. In 2021-22, the state received new investment proposals of Rs 85, 831 crore and during the pandemic year 2020-21, worth Rs 85,557 crore. While the new investments in most of the states had slowed down considerably, Tamil Nadu continued to be investors’ favoured destination, added Rawat.
In 2021-22, the completed projects were worth Rs 24,850 crore, while the state government revived projects of Rs 1,647 crore. As per data available with the Centre for Monitoring of Indian Economy (CMIE), the total investment projects outstanding were of Rs 14, 21,792.38 crore and under implementation was to the tune of Rs 7,54,634.33 crore.
During FY20, new investment projects were of `81,406.35 crore, completed projects worth Rs 34,978.15 crore, revived projects of Rs 2,155.78 crore, total investment projects outstanding were of `12,38,180.20 crore, and projects under implementation were at Rs 6,34,180.05 crore.
The study attributed continuous flow of investments, both domestic and foreign, to the state’s advanced infrastructure, mature industrial ecosystem and logistics capabilities. The state government has already taken a host of policy initiatives to become the leading investment destination.
The study found that a number of micro units and ancillaries are coming up, including in rural areas. Reportedly, there are over 5 million MSMEs, third behind the Uttar Pradesh and West Bengal. In terms of nature of ownership, proprietorship accounts for 91.13%, partnership 0.44%, companies 0.10%, self-help groups 0.26% and others 6.11%; more than 95% of MSMEs employ five or less workers.
It was observed that the overwhelming majority of MSMEs are self financed and initial investments come from their own sources of funds or through informal sources.
To strengthen the MSME sector, the state government has taken several initiatives including handholding and financial support. The MSMEs are major contributors to value creation, generating between 50 to 60% of value addition on an average.