Tamil Nadu - Projects and Development II

[Subra]

ETL Infrastructure Services Ltd, promoted by Elnet Technologies Ltd and Infrastructure Leasing and Financial Services Ltd, plans big investments in Madurai and other southern districts of Tamil Nadu.

The company is presently building a heritage resort hotel in Madurai, which is known for temples and textiles, at a total investment of Rs 75 crore.

Targeted at tourists and businessmen, the hotel to be named ‘Heritage Madurai’, will come up on 14.5 acres. It will have 68 rooms in the first phase and is expected to be ready by June 2007. The number of rooms will be increased to 100 in the second phase.

ETL has acquired the Old Madurai Club property, originally designed by eminent Sri Lankan architect Geoffrey Bawa, to renovate and add more facilities to create an architecturally unique resort.

“Madurai has a colonial history and we see this as a revival of something which has been forgotten. We have taken over a colonial building, refurbished it and are developing it as a resort hotel by maintaining the designs and traditions of the city," said Jair D'souza, vice-president (commercial), ETL Infrastructure.

The company plans to build another heritage hotel in Pudukottai at an investment of Rs 35 crore. The company has already acquired the property and this facility is also expected to be ready by mid-2007.

As Madurai is seen as a potential Tier-II destination for IT, ITES and manufacturing sector and several companies eyeing the city, ETL also plans to build a shopping complex and a world-class convention centre in the temple city at an investment of Rs 100 crore.

ETL is also in the process of developing a special economic zone for the textile industry at Perundurai. Another textiles SEZ is planned in Tuticorin.

ETL has built an IT/ITES SEZ called 'Chennai One' on Chennai's IT Corridor of Old Mahabalipuram Road. The facility is presently occupied by companies like TCS, Wipro, Siemens, HCL and Ford Business Solutions, among others. The ETL group has interests in the textiles and coffee business.

http://www.business-standard.com/com...eft=1&leftnm=1

[MaduraiSelvam]

Public health system in TN strong: Virologist

VELLORE: At a time when all other states were planning to implement the National Health Policy 2007: achieve zero growth of HIV/AIDs, the Tamil Nadu Government had already achieved it through its Public Health System (PHS), said T Jacob John, a leading virologist and former Head of the Department of Virology, Christian Medical College.
Delivering a keynote address at a seminar on ‘Prevention and control of HIV/AIDS’ organised by the South Central India Network for Development Alternatives (SCINDeA) here on Wednesday, he said though various awareness and prevention programmes were conducted in other states by involving non-state actors, these programmes were not able to make a great leap due to the virtual absence of separate PHS.
While private medical care focused on individual health aspects, which was often driven by the market forces, it was the PHS, concentrating on providing community health service and upholding social justice, that proved very successful in Tamil Nadu, he added.
With a multi-pronged intervention of NGOs and PHS in Tamil Nadu, the Sexual Transmissible Disease was brought down to less then 5 percent, he said adding that other states should replicate the Tamil Nadu PHS model.
While even countries like Thailand and Sri Lanka had a separate disease surveillance system to keep a vigil on the spread of new diseases and to update the knowledge on diseases, the Indian Government appointed a special team to study a disease only after it infected people, said John.
In spite of these drawbacks, the Indian Government was able to reduce the HIV rate to around half a million between 2004-05, when compared to other African countries, he said.
He, however, said, “We need to spread the message of sexual morality, which is imbibed in our culture, so that urban youth who are influenced by the western culture can be prevented from getting infected by the dangerous disease.”
Earlier, speaking at the function, Dr A Somasundaram, deputy director, health service, Vellore, said, “Instead of getting bogged down with interpreting data on the rate of infection across the district or state, we should all work towards preventing the spread of AIDS and remove the social stigma, which excludes the AIDS affected from the mainstream society,”
He also pointed out that with the increase in mobility, migration and transportation of middle and lower middle classes, the control of HIV/AIDs became a big challenge. However, by spreading proper information to the public, the disease could be controlled, he added.
S Chandra Sana, joint director of medical services, Vellore, explained about the availability of medical facilities in the Government and Primary Health Centres.Later, various religious leaders spoke on sex morality and important of safe sex.

http://www.newindpress.com/NewsItems...+Nadu&Topic=0&

[Subra]

The Government is set to clear the entire Phase Three of the National Highway Development Programme (NHDP III) where seven new road projects are to be included for Bihar, taking the length of roads in the state under NHDP III from 113 km to 890 km.

A sizeable portion or around 10 per cent of the total length under NHDP III would be for the North-East states, covering Assam, Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland and Tripura. This fits into UPA plans to improve connectivity in states along the China border.

In all, the Government is going to increase the length of roads under NHDP III to 11,530 km — the Cabinet has already given its nod for 6,139 km. In fact, Bihar will have the largest increase in the total length under this programme — up by 777 km.

The Cabinet was to okay this proposal at its meeting tomorrow but it is being rescheduled, possibly for next week, as Road Transport Minister T R Baalu will not be able to attend the meeting tomorrow.

The NHDP III basically envisages connecting important state capitals and cities of economic and tourist importance that are otherwise not covered under the Golden Quadrilateral and the North-South East-West corridor projects.

While work has already started on some of the NHDP III projects (under NHDP III A), the Cabinet approval will be for the entire programme.

Under the approval sought for NHDP III, seven projects would be added for Bihar and five new projects, totalling a length of 613 km, for Assam.

J&K will have one new 101 km project connecting Srinagar-Baramula-Uri.

Tamil Nadu, which already has approval for ten projects totalling 1,146 km under NHDP III, will now have a total of 13 projects, totalling 1,455 km under this programme — the largest for any state.

http://www.indianexpress.com/story/19060.html

[Anniyan]

what are the three new projects under NHDP III ?

[madurai veeran]

I guess it could be these projects as they feature under NHDP III B,

1. CBE-Mettupalayam
2. Madurai-Rameshwaram
3. Dindigul-Periyakulam-Theni-Kumuli

[WillyWick]

Stretch, length (km) and estimated cost(crores)

1. Dindigul-Trichy 80 521.6
2. Nagapatnam -Thanjavur 74 482.48
3. Trichy -Karur (including Trichy Bye-Pass) 88 573.76
4. Salem -Ulundrupet 134 873.68
5. Krishnagiri -Tindivaram 170 1108.4
6. Trichy -Puddukotai -Ramanathapuram 200 1304
7. Dindigul-Perigulam-Theni 73 475.96
8. Madurai-Ramnathpuram-Rameshwaram -Dhanuskodi 186 1212.72
9. Coimbatore-Mettupalayam 45 293.4
10. Theni-Kumili 57 371.64

[Anniyan]

NHDP Phase III A

1)Tirupati -Tiruthani - Chennai
2)Pondicherry - Tindivanam
3)Trichy - Karaikudi
4)indigul-Trichy
5)Salem-Ulundrupet
6)Madurai-Arupukottai-Tuticorin - U/C
7)Nagapatanam-Thanjavur
8)Karaikudi - Ramanathapuram
9)Thanjarur - Trichy - U/C
10)Trichy - Karur (Incl. Trichy bypass)

NHDP Phase III B

11)Madurai-Ramnathpuram-Rameshwaram-Dhanuskodi
12)Dindigul-Perigulam-Theni
13)Coimbatore-Mettupalayam
14)Theni-Kumili

source: NHAI website

[MaduraiSelvam]

Power generation companies flocking to Tamil Nadu

Investor-friendly climate attracting power promoters

Udhagamandalam: The investor-friendly climate in Tamil Nadu has started attracting power promoters in different parts of the World, said the State Electricity Minister Arcot N.Veerasamy at Singara near here on Thursday.
Participating in the Platinum Jubilee celebrations of the Pykara Hydel Project, he said that power companies in several countries including France and Malaysia were eager to set up units here.
While the estimated investment would be about Rs. 1.3 lakh crore, the total power generated would be 33,000 Mega Watts. Though in power generation Tamil Nadu was a surplus state, the foreign companies were keen on investing here because of the Naxalite problem in Andhra Pradesh, labour problems in Kerala and the high cost of land in Karnataka.
Commending the TNEB engineers and staff for having maintained properly the machinery at Pykara and Kundah, he said that the workers would be paid a special bonus of Rs. 1000 each.
The State Khadi Board Minister K. Ramachandran who presided said that the Pykara project had served the country well for several decades. The State Rural Industries Minister Pongalur Palanisamy said that in encouraging the private sector to set up power projects, Tamil Nadu was showing the way to other states.
He added that while the forests here should be preserved, the roads should be maintained properly. The Chairman, TNEB, Hans Raj Varma welcomed the gathering. The Member (Generation),TNEB, S. Arunachalam presented a project report.

http://www.hindu.com/2006/12/22/stor...2216900300.htm

[MaduraiSelvam]

Kodaikanal to get ultra modern bus stand in a year: Stalin

Power sub-stations to be set up at Thamaripadi, Ranganathapuram

KODAIKANAL: The construction of an ultra modern bus stand for Kodaikanal town would be completed within a year. Creation of such facilities will attract more tourists to the hill station, said the Minister for Local Administration, M.K. Stalin. Inaugurating a sub-station and laying the foundation stone for the new bus stand here on Thursday, he said that instructions had been given to complete the project before the prescribed period.
The TNEB sub-station would help to wipe out low voltage problem and avoid power loss. Kodaikanal town and 39 villages, including Perumalmalai, Pannaikadu, Vilpatti, Mannavanur and Kavunjipadi, would be benefited. Two more new sub-stations would be set up at Thamaripadi and Ranganathapuram near Dindigul in 2007, he said. "I have planned to conduct review meeting for local bodies in Sivaganga and Theni districts shortly. After 10 days, Nilgiris and Dharmapuri districts would be covered," the Minister said.
The Collector, R. Vasuki, said the new bus stand would be constructed at an estimated cost of Rs.4.87 crore. The Minister for Transport, K.N. Nehru, said that 2,230 buses would be purchased before March to enhance public transport system in the State. Three thousand buses would be purchased every year in the subsequent years to replace the old vehicles and to introduce new routes. The Highways Department had offered to give its land on the hill worth Rs.50 crore for the new bus stand. Efforts would also be taken to operate buses to distant places like Bangalore from Kodaikanal.
The Minister for Revenue, I. Periasamy said that farmer's card would be issued to 66 lakh agriculture labourers shortly. Pattas would also be given to all eligible people on the hill. The District Panchayat Chairman, Kavitha Parthiban, the Government Chief Whip, R. Chakkarapani, and MLAs, K. Anbazhagan and M. Thandapani spoke. Later, Mr. Stalin introduced 66 new bus routes and disbursed welfare aid worth Rs.2.66 crore to 365 beneficiaries.

http://www.hindu.com/2006/12/22/stor...2210230300.htm

[MaduraiSelvam]

Mobile health clinic to cover tribals

NAMAKKAL: The Madras Aluminium Company Limited (MALCO) has initiated a healthcare programme called mobile health clinic to cover the tribals of Koli Hills. According to a press release from Malco's Bauxite Mines Manager M. Kannan, the scheme would take the medicare facilities to the remote villages and hamlets in Kolli Hills as the people living there were not able to access and afford the treatment facilities, which are available at Namakkal and near-by towns.
This condition severely affected women and children. In order to overcome this health related issues MALCO, he said, had started the project with the cost of Rs. 15 lakh per annum. Through this project specialist doctors would visit each village in remote area and provide treatment every Saturday.

The programme, 22nd in its series, was organised at Jallipatti and Plantoor villages in coordination with the Forest Department recently. Sachidanathan, Forest Ranger, Kolli Hills, Balasundaram, Village Administrative Officer, Kolli Hills and M. Kannan coordinated the effort in which 200 people benefited.

http://www.hindu.com/2006/12/22/stor...2201300300.htm

[MaduraiSelvam]

EduFrance to launch online academic tie-up

CHENNAI: EduFrance’s website allowing institutions in Tamil Nadu to register to enter into academic negotiations with France’s top educational institutions will be launched on January 8, 2007, said Olivier Chiche-Portiche, project manager, French Higher Education Week 2007 in India, on Wednesday.
The French Higher Education Week 2007 will be held in Delhi, Pune, Hyderabad and Chennai from February 15-23. While in Delhi and Pune, the focus will be on education fairs aimed at increasing student enrollment in French educational institutions, in Chennai and Hyderabad, EduFrance will be looking at facilitating more Memorandums of Understandings and joint research ventures with institutions from the South.As many as 130 top institutions from France will be participating, with about 40 interested in entering into agreements with Southern institutions.
For this purpose, EduFrance, an agency of the French Government has created a website (www.edufrance.in) on which the background and interests of the French institutions have been listed.A fairly comprehensive list of educational institutions from Tamil Nadu is also being prepared. Any of those institutions can enter the website and choose which French institute they wish to negotiate with.
The website will then generate a series of half-hour time slots on February 19 and 20, when representatives from the two institutes may meet. Each Indian institute may make up to 14 appointments in this manner. A maximum of 40 slots are available, so registration will be on a first-come first-served basis.
Cities in the spotlight will be Chennai, Coimbatore, Trichy, Madurai and Puducherry. However, institutions interested will need to contact EduFrance in Chennai to become part of the list and can email edufrance@af-madras.org or contact Brijveen Sabherwal at 4202 8773.
The initiative is aimed at promoting academic interaction in Chennai and Hyderabad, which will also facilitate more scholarships and student exchange programmes.Sabherwal, an education counsellor with EduFrance stated that French interests were in areas of agriculture, humanities, social sciences and linguistics, while on the Indian side it was life science, nanotechnology and the like.At present, out of the 5,60,000 international students in France, only 1,600 are from India though the quality of education available there is of international standards and tuition and living costs were inexpensive, Chiche-Portiche added.

http://www.newindpress.com/NewsItems...ennai&Topic=0&

[Subra]

http://www.newindpress.com/NewsItems...l+Nadu&Topic=0

TIRUCHY: Electronics Corporation of Tamil Nadu is soon to set up branch offices in districts across the state to further its support to the state government’s e-governance ventures.

As many as 30 branches would come up in the state, the establishment of which would begin from January 2007. The branches would have technical people from ELCOT headed by a branch manager, while engineering graduates from the locality would also be picked up and trained for specific tasks.

The branches would have multiple tasks to execute including hardware support to the district administration with regard to e-governance. The idea is to support the government in IT initiatives, the fruits of which would then be taken on to the public, ELCOT Managing Director C Umashanker told this website’s newspaper.

ELCOT is working on the final figures of the outlay needed for establishment of the offices, he said. ELCOT is also keen to obtain ISO certification for these branches in due course.

In fact, the branch offices are likely to play a key role in a much larger project of establishing information technology laboratories in government schools across the state, with at least ten computers to each school. ELCOT would be procuring as many as 32,000 computers soon, to be distributed among the schools across the state.

Tenders have been floated for the purpose and the procurement would begin from ten days after the opening of tenders. In a bid to ensure quality in the products, ELCOT would be receiving samples from the interested firms and put them to test.

A major share - 18,000 computers would be distributed to 1880 higher secondary schools in the state, while 10,000 computers would be utilised under Sarva Siksha Abhigyan scheme benefitting nearly 1000 primary schools. ELCOT would have 500 computers for itself, while the District Registrar Offices would be provided 1500 systems.

Umashankar said engineering graduates in the locality would be picked up through the branch offices and trained by ELCOT personnel who would in turn offer high quality computer education to the teachers for a term of five years. We would be covering 60,000 - 70,000 teachers during the period, he said.

The training would be different for higher secondary, high school and primary school teachers, depending upon the syllabus they handle. Short term courses on computer were also likely to be conducted by the branch offices.

[Subra]

CHENNAI, DEC 22: The Tamil Nadu Industrial Development Corporation Ltd (Tidco) is planning to impose service fee for all its future joint venture projects.
The agency is looking at charging JV companies 1% of the total project cost as service fee for obtaining the necessary approvals and paper clearances from the government. According government sou-rces, Tidco tried this model with the Ascendas IT park project and it worked out well, so they are trying to replicate this model with other JV projects.

If Tidco is not involved in the land purchase process, it charges 1% of the entire project cost as service fee. But if it helps the JV companies in sourcing land, then it would charge an additional 1% on the cost of purchase of land. If this kind of an arrangement is done with the joint venture company, then TIDCO is bound to deliver those services, which are listed out in the agreement.

The service fees get charged on to the JV company only after delivering all the serviceswhich are written down, sources said.

TIDCO would implement this model only in the joint venture projects. For the other projects, it is the Tamil Nadu Guidance Bureau which does the paper work.

http://www.financialexpress.com/fe_f...tent_id=149707

[Subra]

http://www.business-standard.com/lif...o=268931&tab=r

------------------------------------------------------------------------
Pradip Chopra, director, says the company, along with another city developer, Srijan Group, is building a 3,50,000 sq ft mall in Chennai, another huge 9,50,000 destination mall in Coimbatore, two middle-end housing projects in Chennai
------------------------------------------------------------------------

The PS Group will need a capital flow of around Rs 500 crore for its various projects in the next two years — Rs 225 crore for the Coimbatore mall, Rs 80 crore for the mall in Chennai, around that much each for the two residential estates, Rs 150 crore for the Chandigarh SEZ and another Rs 250 crore for the Pune one.
------------------------------------------------------------------------

[Subra]

Tamil Nadu's unhyped success in industry and services has much to do with quality infrastructure and forward-looking policies.

“In Europe, we have a saying: ‘Do not rock the boat’,” says the lanky Finn, pausing for effect. “We expect work out of Tamil Nadu to gather strength without interruptions at every stage.” So far, Jukka Lehtela, director of telecom giant Nokia’s India operations, has had little to worry about.

But the strain of the ongoing MNC assault on Sriperumbudur — Tamil Nadu’s manufacturing sweetspot — is beginning to tell.

“The cooperation extended by the Tamil Nadu government is the best thing we could have hoped for. But we need rail connectivity; there is just one highway which is already under strain from all the SEZs (Special Economic Zones) operating in the Sriperumbudur-Kancheepuram belt,” says Lehtela.

Lehtela isn’t the only one to recognise that Tamil Nadu’s manufacturing competitiveness has doubled, with the largest number of SEZs operational in India.

“We visited several locations in India before zeroing in on Chennai,” says Raimo Puntala, a senior vice president-operations at Nokia. “Our decision was based on the approach of the state government, the overall development of the area, and the availability of skilled manpower.”

These factors have for years been attracting the world’s leading auto manufacturers — Ford, Hyundai, Hindustan Motors, Mitsubishi, BMW — to Chennai, making it the export hub for cars.

Y S Kim, CEO of Hyundai Motors India, notes, “Chennai was our choice due to the efforts of a transparent and proactive state machinery.”

Well before Nokia’s Lehtela voiced his concern about the overcrowded Sriperumbudur highway and the need for rail connectivity, officials of the Madras Export Processing Zone had submitted a detailed development plan to the Ministry of Railways.

Says an MEPZ official, “We are waiting for approval for a railhead near Sriperumbudur, linking it with Annanagar in south Chennai. Another railway line will offer access to the Ennore and Chennai ports. Two other roads will link SEZs in the Sriperumbudur-Kancheepuram area with the airport.”

A third railway line is proposed to link the city precincts with technology parks along the Old Mahabalipuram Road, Chennai’s famed “IT corridor”, and Tidel Park, one of the city’s first technology parks.

The new rail link will mitigate the travel headaches of employees commuting to TCS, Satyam, Wipro, Cognizant and other IT companies, which have set up operations in the IT Corridor and nearby Siruseri, a fast-emerging hub for SEZs.

The government has been quick to sanction Rs 300 crore to upgrade two key highways. The industrial artery of Sriperumbudur will be upgraded into a six-lane highway, says Tamil Nadu’s industry secretary Shaktikanta Das.

The Rs 5,060-crore Chennai Metro Project is expected to add impetus to the infrastructural growth once Sriperumbudur is linked to the project.

Auto-motivated: While the government scrambles to sustain the momentum of growth, Tamil Nadu now accounts for a 25 per cent share of the total Indian automotive and ancillaries industry.

The manufacturing sector is growing at 12 per cent annually and has received enough momentum by way of government support. The automotive and ancillary industry alone has enough potential to grow to $18-20 billion by 2015, says Shaktikanta Das, noting that the state should target a 30-35 per cent share of the pie by 2015.

According to another high-ranking government official, “While we have drastically reduced inefficiencies in the system, road congestions and lack of infrastructure remain to be addressed. We are working on it.”

He adds that “working on it” is more than just a figure of speech in today’s high-activity industrial environment in Tamil Nadu. “If results are not delivered, all we have achieved over the last few years will be compromised.”

For that kind of marketshare, the Tamil Nadu government is targeting automotive component exports to touch $6-7 billion and domestic sales components and completely built units (CBUs) at $5 billion.

“Exports of CBUs and engineering design services could contribute around $1.5-2 billion to the state’s total output by 2015,” Das says.

The transformation of a state which at last count produced 21 per cent of all passenger cars, 33 per cent of all commercial vehicles and 35 per cent of all automobile components has been slow, steady and remarkably unhyped. The growth potential was fuelled by a strong investment climate and low costs of operation out of the state.

Uncomplicated lifestyles, high literacy, openness to outside influences and a work culture rooted in hard work became added draws.

The role of large-scale FDI in employment generation for technical graduates belonging to the deprived classes was not lost on the Dravida Munnetra Kazhagam (DMK) and its key rival, the All-India Anna Dravida Munnetra Kazhagam (AIADMK). Over the years, both parties became active stakeholders in the new dream.

The incentive packages, ably engineered to lure manufacturers, have been matched by the will to keep them comfortable. About 110 key players of the world’s automobile and ancillaries industry have located themselves in Chennai, and auto component exports from Tamil Nadu are $240 million, constituting 27.5 per cent of the country’s total exports. The auto component industry has witnessed an investment of $800 million in recent years.

The government clearly has a masterplan. For one, linking the manufacturing hubs and fragmented suppliers in Madurai, Hosur and Coimbatore to Chennai would help newer units to come up. It would help reduce supply chain costs.

The quick availability of labour and low attrition rates in the manufacturing industry have worked well for the state.

Industrial fibre: Tamil Nadu’s strong infrastructural and technical support, and access to key markets in India and Asia, are cited by companies like French glassmaker Saint-Gobain, hardware giant Flextronics and Dell as prime reasons for migrating their manufacturing processes.

“Reduced time to market, low labour and logistics costs, lower inventory costs, good workmanship, and a responsive supply chain are strong incentives for manufacturers,” says Gururaj, GM-India operations of Singapore-based Flextronics.

With work on railway lines connecting Chennai’s suburbs and the airport to Sriperumbudur and expressways to the nearby Ennore and Chennai ports now underway, the government hopes suppliers downstream will find rushing their goods to the manufacturing facilities a smoother affair. This would help industrial zones being developed in the neighbouring district of Hosur.

Initiatives to improve port infrastructure are on in Tuticorin and Ennore. The Chennai Port Trust is creating a second container terminal at a cost of Rs 400 crore and an off-dock container freight station.

Tamil Nadu’s 1,076 km coastline lends itself to multiple availability of sea routes and further possibilities for port development. The five domestic airports at Chennai, Tiruchirapalli, Coimbatore, Madurai and Tuticorin are well poised to handle the uptake in traffic, while cargo handling at Chennai’s international airport is being upgraded.

Strong fundamentals: Sixty years before the “Detroit of India” tag was slapped on Chennai, the state’s textile units were known across the Western world. Outsourcing, well before it became a fashionable term, had its inception when the dozens of mills dotting the Tirupur-Coimbatore-Erode textiles belt sub-contracted work from the larger textile houses of the West.

Exports overflowed in the warehouses of Tirupur and found their place on the shelves of Harrods and Carrefour. They were enough to lend credence to the time-tested Tamilian brag — that Tamil Nadu’s textile belt boasted the highest density of imported cars in India.

Tamil Nadu was one of the first states to formulate an ITES and biotech policy. Funds have been created for promoting the state at national and international trade conferences.

The strong economic fundamentals of tier-II cities are the result of two factors. First, the state government agencies helped wealth creation down the years by encouraging small scale industry in the textiles and agricultural sectors. Second, private sector participation in the process of infrastructure development was welcomed in Chennai, Coimbatore, Madurai, Trichy, Salem and Tirunelveli.

This resulted in rapid expansion of roadways, railways and capacity enhancement of the ports and tier-II cities. The easy nexus between credit availability and infrastructure development has been boosted by the huge number of banks in Tamil Nadu.

The emphasis on uniform infrastructural development will generate further industrial activity in relatively backward areas, say government officials.

The revived Sethusamudram project is expected to provide a continuous navigable sea route along the Indian peninsula and could transform Tuticorin port into a transhipment hub.

Building the Go TN mindset: The New Industry Policy introduced in 2003 was a key harbinger of the new industrial order. It helped reel in the big investors. Monitored by SIPCOT, the policy has been offering structured assistance and other incentive packages like soft loans to companies making single investments exceeding Rs 300 crore.

While assignment of land is still on a cost basis to ensure that land-owners are not shortchanged, the incentives policy mostly applies to companies who make their investments within three years.

For investments exceeding $11 million, subsidies are being given on effluent treatment plants, electricity duty is fully exempted and a 50 per cent concession on stamp duties is offered. Soft loan packages from the government typically factor in state and central taxes paid by the company once it starts production.

Thereafter, it is progressively reduced as the manufacturing units pick up steam. Higher weightage is also being given to units set up in industrially and economically backward areas.

With an upgraded industrial policy to be announced by the end of the year, the hassle-free growth of industries will be further concretised. “The Corridor will offer world-class infrastructure,” say government officials.

Mahindra World City, 30 km from Chennai airport, has the best of these. Monitored by the Madras Exports Processing Zone (MEPZ), about 75 companies, including the TVS Group and BMW, operate out of the 1,400 acres of agricultural land painstakingly assembled and spruced into industrial readiness by the Mahindras since 1996.

The multi-product World City anticipates exports touching Rs 8,000 crore by 2012 from its three specialised SEZs.

Realty checks: The high level of economic activity benefits a third force — the fragmented developer community and property funds which are slowly moving in. The potential is multifold. Residential development inside an SEZ could generate a few thousand jobs within the premises.

Moreover, the space multiplier effect comes into play in the residential paradigm. “A single person in an IT SEZ office requires up to 200 sq ft of office space. But he will need at least 1,000 sq ft of residential space,” says S J Vijay of Salmon Leap Associates.

Managing director R Ravi of real estate development firm RR Industries, sees Madurai (with a population of 5 million people) as ideally placed to have at least 1,00,000 people employed in the IT/ITES sector.

For infrastructure developers like RR, the ongoing churn in the real estate market is a natural corollary to the industrial boom, though not totally welcome. “The SEZ hype has resulted in land prices zooming out of control,” Ravi notes.

Realty executives note that tier-II and tier-III cities can get their act together if they provide the right infrastructure at the right cost. “Then the developer would become a force to reckon with in the manufacturing scenario,” he hopes.

“Cost will be the main advantage and the plank on which tier-II and tier-III cities will compete to pull in SEZs,” adds Raj Menda, managing director of RMZ Corp.

But unlike SEZs specialising in manufacturing, reduced land and operating costs and HR skills alone cannot usher in an IT industry. Robust all-round infrastructure, a positive workforce attitude and apolitical industrial environment are paramount enablers, say industry watchers.

“Inadequate availability of these requirements raises operational costs out of any location,” they say. Rest assured, it’s a hurdle Tamil Nadu is keen to vault.

THE FUNDAMENTALS
MANPOWER: Highest annual turnout of technical manpower: 252 engineering colleges and 230 polytechnics churn out 1,00,000 engineering graduates and 63,000 diploma holders, not to mention 1,13,000 ITI trained workers every year.

WAGES: Wage costs are cheaper than other Indian metros and, in NPV terms, at least 11 per cent cheaper than China, according to a Nokia study.

INFRASTRUCTURE: Tamil Nadu and capital Chennai are rated higher than other cities by major MNCs.

COMMUNICATION: Chennai is a leader in bandwidth capability with 13.2 tbps bandwidth availability via two submarine cables.

POWER: The only state in India with surplus power and total available capacity of 13,426 MW.

AIR CONNECTIVITY: Chennai airport is South India’s largest with 270+ passenger flights and 30 cargo flights every week.

HEALTHCARE: Often rated as the healthcare capital of India.

INDUSTRIAL CLIMATE: Mature manufacturing sector. Prime contributors are cordial management-labour relations and a peaceful industrial environment. Man-days lost due to labour unrest during 2005 were 0.7 per cent, the lowest in India.

INDUSTRIAL PARKS: Over 110 major industrial parks and SEZs.

PORTS: Three major ports at Chennai, Ennore and Tuticorin supported by 15 minor ports.


http://www.business-standard.com/lif...o=268935&tab=r

[Anniyan]

Three projects to come up near Cuddalore port

Highways and Ports Minister M P Swaminathan on Friday said that a thermal power plant, an oil refinery and a ship building yard would come up within a distance of eight km from the Cuddalore Port soon.

Speaking at the eighth meeting of the Maritime States Development Council at Cochin, the Minister said a thermal power plant of 1,320 MW capacity, requiring approximately 3.50 million metric tonnes of coal per annum, would be established near Cuddalore.

Besides, an oil refinery which would import 6 million metric tonnes of crude oil and export 2.50 million metric tonnes of petroleum products per annum would also be established.

Apart from these, a ship building yard, which would build ships of size between 45,000 DWT to 75,000 DWT, would be established, the Minister added.

The Minister also pointed out that the economy of the State would witness a boom owing to the Sethusamudram project and the ongoing development works at Colachel, Cuddalore, Cheyyur, Nagapattinam and Rameswaram Ports.

http://www.newindpress.com/NewsItems...ennai&Topic=0&

[MaduraiSelvam]

Wind monitoring station set up

Plan to install stations at Theni, Udhagamandalam

MADURAI: A wind monitoring station has been established at Kodaikanal in Dindigul district by the Tamil Nadu Energy Development Agency (TEDA) and Centre for Wind Energy Technology (C-WET). The station will collect data on the wind availability in the locality, based on which it will be decided if the place has "wind potential" for generating electricity, according to M. Vijayakumar, Deputy General Manager, TEDA.
It has been proposed to install two more stations, one each at Theni and Udhagamandalam. Mr. Vijayakumar said that these stations would survey the wind speed, direction and density for a period of not less than two years.

"The results will be analysed by C-WET."
Based on its recommendations, a decision will be taken on windmills, each of which costs between Rs. 4.25 crore to Rs. 5 crore for installation. Elaborating on the technical aspects of the tests, he said that these monitoring stations would consist of a 50-metre high mast, on which an `anemometer,' an equipment to analyse the wind speed, would be mounted at three places — at the top, 30 metre and 10 metre of the mast.
A `wind vane' would be mounted at the top and at 30 metre to monitor the direction of the wind. "These will record the data for every single minute of the testing period of two years or more." In 1985, wind-monitoring stations were set up at 61 places in the State, of which 41 were declared as having "wind potential." Tamil Nadu, which ranks first in wind power generation, has nurtured this sector from 115 windmills in 1990-91 through which 18.57 MW of power was generated to 4,604 windmills by 2004-05 with more than 3,700 MW being generated. Tamil Nadu accounts for more than half of the about 5,700 MW of power generated in this sector by India, which ranks fourth globally.

http://www.hindu.com/2006/12/27/stor...2721430300.htm

[MaduraiSelvam]

Kanyakumari, Asias highest water canal bridge.

[IMG]http://i16.************/339lhlh.jpg[/IMG]

[MaduraiSelvam]

New approach to planning in Tamil Nadu — Targeting the growth process
K. Jothi Sivagnanam

Achieving a high growth rate as well as a desirable level of income distribution is a goal that continues to be elusive in India. Thus, the maiden approach of the Tamil Nadu State Planning Commission to place importance on the `growth process', alongside the growth rate, is interesting and appropriate.

There has been a marked shift in the approach of the Tamil Nadu Government towards planning and development. The Approach Paper to the Eleventh Plan (2007-2012), presented for public debate by the State Planning Commission, has come out with a technically sound approach. Achieving a high growth rate as well as a desirable level of income distribution is a goal that continues to be elusive in India, both at the lower and higher growth trajectories.
In this context, the maiden approach of the newly constituted Tamil Nadu State Planning Commission to place importance on the `growth process', alongside the growth rate, is interesting and appropriate. The practical and contemporary relevance of the new approach is well reflected in the panel's empirical analysis of the emerging developmental challenges facing the State, based on a comprehensive, sector-wise study.
Agriculture, the critical sector for the overall growth, income levels and well-being of the people all have been in a crisis from 1993-94 to 2005-06. While the relative share of agriculture to the GSDP (Gross State Domestic Product) has declined from about 25 per cent in 1993-94 to 13.3 per cent in 2005-06, more than half the population (56 per cent) still depends on farming and related activities for its livelihood.
The fact that nearly 56 per cent of the population living in the rural areas is dependent on less than one-seventh of the State's income raises serious concerns over the distribution of income, argues the Approach Paper. Having recognised the problem right, the Approach calls for a `crucial, direct role' to be played by the State. Further, for the revival of the farm sector, the focus will be on the `farmer and his welfare' rather than on the `farm and/or technology', as has been the case till now. It also identifies specific areas of intervention, such as access to land, credit, market, support prices, and so on. A similar approach is spelt out for all other sectors — social sector, service, and industry — with a marked focus on promoting the welfare of the downtrodden and the marginalised.
Development Record
The development record of Tamil Nadu, post-Independence, shows that the unique process of development is mostly inherited from the first quarter of the 20th century. Since then, social justice has been accepted as one of the cardinal development objectives to be pursued.
Many innovative social sector schemes and programmes were designed by the ruling DMK government, aimed at directly addressing human problems — social security, food security, nutrition, education, primary health, social welfare, welfare of women, children, and weaker sections, housing, poverty and unemployment.
Most of these schemes are targeted towards specific income and/or social groups. Some were widely appreciated and some even emulated at the national level. The degree with which such policies are being pursued is further evident from the fact that, unlike its northern counterparts, almost half the public expenditure in Tamil Nadu is on social sector. For inclusive growth, the Approach relies on enhanced public expenditure on social, agricultural and rural sectors so as to directly influence the process of growth. However, in the post-reform period public expenditure on the social sector declined considerably. The reversal of this trend is noticeable now.
The State Budget for 2006-07 rightly raised the allocation to the social sector by 17 per cent over the revised expenditure estimate of 2005-06, and the government has come out with many new schemes in the above areas and made many policy reversals including that of public recruitment. Still, the share of the social sector is yet to reach its pre-reform level, as it constitutes only 35 per cent of the revenue expenditure, that too only as the Budget estimate.
The Medium-Term Fiscal Plan, presented along with the State Budget 2006-2007 under the Fiscal Responsibility and Budget Management Act, 2003, requires eliminating revenue deficit by 2008-09.
Transfers from Centre
Social sector spending should be increased, not only through higher revenue mobilisation, but also by obtaining higher financial transfers from the Centre.
In this regard, one of the immediate concerns is the Planning Commission's persistence with the Gadgil formula. According to this formula, transfers will consist of 30 per cent Plan grant component on the revenue account and 70 per cent as loan. The 30:70 ratio is irrelevant as it was decided on at a time when State finances did not suffer as much current debt burden.
Second, when Tamil Nadu spends almost half of its revenue expenditure on `human-centred' sectors even now, it is time for the Planning Commission to reconsider the (ir)relevance of its Plan transfer approach and revise it with more revenue grant component than loan. The ratio can at least be revised to 50:50 during the Eleventh Plan period.
On the revenue front, after insisting on a reversal of the falling federal transfers, the Approach Paper pleads with the State Government to pursue the case for the Union Government allowing States to levy taxes on the service sector — the highest contributor to the GSDP — to overcome problem of limited tax base and shrinking federal transfer.
The `benefits' that have failed to `trickle down' for so long and even at 8 per cent growth rates at the national level may remain `invisible' forever, for reasons best known to the die-hard neo-liberals. Hence, it is the right time for the Yojana Bhawan to thoroughly re-look at the Approach to the Eleventh Plan. This appeal deserves significance on two counts: First, the challenges of agriculture, social sector and distributive justice elsewhere in the country are almost similar to that of Tamil Nadu. Second, it must be noted that democracy has repeatedly rejected the growth-centred neo-liberal reforms through electoral verdict, both at the State and national levels, sternly defying any `shine' or `hype' of the campaign.

(The author is faculty member of the Department Economics, University of Madras; email: k_jothisiva@sify.com)

http://www.thehindubusinessline.com/...2900260800.htm

[szatish]

VAT, or the value-added tax as it is popularly known, is clearly gaining ground, with Tamil Nadu state government also deciding to implement the new taxation system in the state from the first day of the 2007. VAT, which seeks to simplify the tax structure and create a uniform common market within the country, replaced the sales tax in India on January 4, 2005. It was adopted by all but three states though: Tamil Nadu, Pondicherry and Uttar Pradesh. Now even Tamil Nadu has jumped on the VAT bandwagon. The development calls for a relook at the new taxation system.

Under the single-point system of tax levy currently followed in the states like Tamil Nadu, the manufacturer or importer of goods into a state is liable to pay a sales tax. There is no sales tax on the further distribution channel(s). VAT, in simple terms, is a multi-point levy on each of the entities in the supply chain with the facility of a credit on the input tax paid. In other words, it is the tax paid only on the value addition in the hands of each of the entities in the chain. For instance, if a dealer purchases goods then:

the purchase price = Rs100
the tax paid on the purchase = Rs10 (input tax)
the sale price = Rs120
the tax payable on the sale price = Rs12 (output tax)
the input tax credit = Rs10
the VAT payable = Rs 2

VAT is payable only on the value added to the product at every point of sale and not on the entire value of the goods. Under VAT, there is no additional surcharge tax or turnover tax. Hence, the tax burden of a producer or importer is less under VAT.

Tax rates in Tamil Nadu
Under the present tax system followed in Tamil Nadu, tax is levied on inputs at a concessional rate of 3%, which is not refunded. Manufactured product is taxed at various rates ranging from 4%, 10%, 12% to 16% and 20% at the first point of sale. Resale tax at 1% is collected at the second and subsequent sale points. Besides the above levy, the manufacturer has to pay a surcharge tax at 5% on the tax paid and an additional sales tax at 1-3% depending upon his turnover in the year. The seller can collect the tax from the buyer and pay the same to the government. But he cannot collect the additional sales tax.

Under VAT, there will be only three rates of taxation: 1%, 4% and 12.5%. There will not be any surcharge tax or additional sales tax.

Gold and silver bullion, and jewellery will be taxed at 1%. Basic goods and commodities, such as medicine and drugs, all agricultural and industrial inputs, capital goods and declared goods will be taxed at 4%. All the other items including cement will be taxed at 12.5%.

We have tried to evaluate the impact of this development on the companies under our coverage based in Tamil Nadu.

Under the present tax system, tax on inputs (raw materials, consumables etc) is collected at a concessional rate of 3% for use in manufacture. This tax on inputs is not refunded or set off against the tax payable on the sale of the finished product. Under VAT, the rate of taxation of industrial inputs will be 4%. The manufacturer will be given the facility of deducting the input tax paid by him against the tax payable on the sale of the finished product.


Company ---Impact ---Extent ----Remarks
Ashok Leyland Positive Rs20-25 crore pa The benefit will accrue on account of credit on inputs and savings of the additional sales tax on turnover paid at the rate of 1-3%. The company derives approx. 18% of its volume sales from Tamil Nadu.
Sundaram Clayton Positive n.a. The benefit of the input cost credit will be positive for the company. Majority of the company's sales are outside Tamil Nadu.
TVS Motors Positive Rs16-20 crore pa The company will benefit on account of input cost credit. It has exemption from additional sales tax on turnover.
Orchid Chemicals and Pharmaceuticals Neutral - The company derives only 16% of its sales from the domestic market. Consequently domestic sales from Tamil Nadu should be marginal.
Madras Cement** Marginal - The savings that the company will enjoy on account of reduction in the tax on the selling price will be offset by the tax that will now be payable on the freight component. Thus the impact on the company's earnings will be negligible.*
India Cements** Marginal - The savings that the company will enjoy on account of reduction in the tax on the selling price will be offset by the tax that will now be payable on the freight component. Thus the impact on the company's earnings will be negligible.
*The company will still continue to enjoy the sales tax deferral incentive till FY2009.

**There will be no major savings in input tax as the same is negligible for the cement industry.