Tamil Nadu cabinet okays Rs 1,352 crore investment proposals

CHENNAI: Amid criticism of poor industrial climate, Tamil Nadu cabinet on Monday cleared Rs 1,352 crore expansion plans of two textile firms and an auto component unit, offering structured package of incentives. These units are estimated to provide jobs to 2,225 people.
MM Forgings tops the list of proposed investment. It seeks to expand an auto component unit in Sivaganga at Rs 511 crore.“The cabinet gave its nod to the expansion plans with subsidy on capital and training and exemption on electricity tax for five years to all the three units,” said an official source. MM Forgings will get 10% subsidy for over ten years and 110 KV dedicated feeder at government cost for its Viralimalai plant. Besides, training subsidy of Rs 4,000 per month for 600 people for six months is also being extended to encourage the unit.
Mothi group has committed Rs 451 crore investment to expand the textile unit in Namakkal, which will provide employment to 1,150 people. The four-year investment period began in May 2018. The government is offering 5% capital subsidy for five years. PKPN, another textile unit, is all set to expand its Dindigul unit at Rs 390 crore, the investment period of which began in April this year. “As many as 475 people will get jobs at the unit as per the estimates,” the source said. The company is also entitled to get a capital subsidy of 5% for five years, besides training subsidy.
The cabinet previously sat three times to clear 38 proposals for subsidies, ahead of the second edition of the global investors meet in January this year. The EPS government has been under tremendous pressure to show improvement in the industrial sector. The government received investment commitments to the tune of Rs three lakh crore and 304 memoranda of understanding were signed in various sectors to provide a million jobs. One of the proposed projects is Rs 27,000 crore investment by state-run CPCL for a petroleum refinery in Nagapattinam. All the projects are in the preliminary stage.
“Even the investment proposals of the first edition are moving at a snail’s pace. Only 22% of the plans have been realized so far, which itself is remarkable, given the feat of other states, including Gujarat,” said a senior official. Jayalalithaa government, in the previous global investors’ meet held in 2015 signed 98 MoUs with investment commitment of Rs 2.4 lakh crore. The AIADMK government also has concerns with FDI equity inflows falling to $2.613billion in 2018-19 from $3.475billion the previous fiscal. The cumulative inflows for the 19 period, ending 2019 suggests that Tamil Nadu and Puducherry received only 7% of the total inflows.