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Tamil Nadu CM unveils Industrial Policy 2021-2025 & MSME policy 2021; 28 MoUs Signed

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Tamil Nadu CM unveils Industrial, MSME policy 2021On February 16, 2021, the Chief Minister (CM) of Tamil Nadu (TN), Edappadi Karuppa Palaniswami, unveiled “Tamil Nadu Industrial Policy 2021-2025” and MSME (Micro, Small & Medium Enterprises) Policy 2021 during a grand event in Chennai. He also launched and laid foundation stones for projects.

  • The reason behind these policies is to make Tamil Nadu a number one destination to invest, innovate and create products and associated services and to create a vibrant ecosystem for MSMEs/startups.
  • The event saw the launch of totally 46 projects for an investment of Rs 33,465 crore that would ensure jobs to 2,19,714 people were launched.

About Tamil Nadu Industrial Policy 2021-2025:

This policy is premised upon the following 4 key objectives:

  • To attract investments worth over Rs 10-lakh crore ($135 billion) by 2025
  • To achieve annual growth rate of 15 per cent in the manufacturing sector during the policy period
  • To increase contribution of manufacturing sector to 30% of the State’s economy by 2030 from currently 25%
  • To create employment opportunities for about 20 lakh people by 2025.

 Key Points:

— This policy is applicable for projects establishing or expanding industrial units, industrial

parks, R&D, warehousing and logistics except in 14 sectors specified by the policy. Investments made from January 1, 2021, will be considered eligible for availing incentives.

–This policy provides a structured package of incentives for companies looking to invest more than Rs 500 crore in the State.

–It offers four different subsidy models to investors viz. SGST (State Goods & Service Tax) reimbursement, fixed capital subsidy, flexible capital subsidy and turnover subsidy.

–It will also provide incentives for companies that provide jobs to transgender people and differently-abled.

–To encourage sunrise sectors, the state will provide additional incentives. Sunrise sectors include ESDM (Electronics System Design and Manufacturing), EVs (Electric Vehicles), EV cells & batteries, renewables parts.

MSME policy 2021

The CM also unveiled new MSME (Micro, Small & Medium Enterprises) Policy 2021 to provide a vital environment for MSMEs/startups. In this regard, the state government already set aside Rs.500 crore for upgradation and maintenance of Tamilnadu Small Industries Development Corporation Limited (TANSIDCO) estates.

Policy Target:

  • To attract new investments worth Rs 2-lakh crore by 2025

Key Points:

–Several concessions including land at 50% discounted price, will be provided to the entrepreneurs starting ventures in the 22 industrially backward districts.

–The MSMEs capital subsidy will be increased to Rs 1.5 crore from the present Rs 50 lakh

–New MSMEs and start-ups will be exempted from approvals for establishment and operation for a period of three years based on self-certification. It is on the condition that the unit should have mandatory approval within a period of one year from the expiry of the 3-year period.

–The new policy has also enhanced ceiling for various subsidies provided to MSMEs

plug & play facilities, plots and sheds will be developed and made available to them on short term lease.

–TN signs 28 MoUs worth Rs 28,053 crore

The state government of TN signed a total of 28 Memoranda of Understanding (MoUs) with a cumulative investment of Rs 28,053 crores across various sectors, including Electric Vehicles, Wind Energy, Auto Components, City Gas, Textiles etc. These MoUs will generate employment for 68,775 persons.

Major Investors

Elest Private Limited:

The state government has inked MoU with Elest Private Limited under which the latter will make investments of Rs 7,948 crore. Elest will be responsible for the manufacturing of cell, battery, E-bus and E-truck which aims to provide employment to 8,081 people.

Tata Electronics:

As a part of MoU, Rs 4,684 crore will be invested by Tata Electronics in TN’s Krishnagiri to make mechanical enclosures for mobile phones. It will create job opportunities for 18,250 people.

  • In this regard, Tata Electronics has been allotted 500 acre by TIDCO.

AG & P:

Atlantic, Gulf & Pacific Company (AG&P), a downstream gas and LNG logistics company, signed MoU with TN Government for the development of City Gas Distribution (CGD) networks to supply natural gas across six districts of Tamil Nadu. The company will invest Rs 2,430 crore over the next eight years.

  • The new CGD infrastructure will be developed under AG&P’s CGD brand in India – AG&P Pratham.
  • It will deliver uninterrupted supply of PNG (Piped Natural Gas) to households, commercial and industrial customers, and Compressed Natural Gas (CNG) depots and stations for 24×7 access to CNG for vehicles.

Ampere Electric:

Ampere Electric, the electric-mobility arm of Greaves Cotton, will set up a manufacturing plant at Ranipet in TN to invest Rs 700 cr over 10 years.


SunEdison also signed an MoU under which it will invest Rs 1,423 crore in the state.

Point to be noted:

Five MoUs were signed under the Structured Package of Assistance. They are with:

  • Tata Electronics — Rs 4,684 crore (employment of 18,150);
  • Sun Edison — Rs 1,423 crore (1,907 persons);
  • Pegatron — Rs 1,100 crore (14,079 persons);
  • TI India — Rs 525 crore (1,813 persons)
  • BASF — Rs 345 crore (235 persons).

Other major Investments under MoUs:

ELEST — Rs 7,948 crore (8,081 persons); AG&P — Rs 2,430 crore (7,000 persons); Netmagic/NTT — Rs 1,377 crore (100 persons); Nordex Acciona — Rs 1,200 crore (3,000 persons); TVS Tyres — Rs 1,000 crore (1,000 persons); Valeo — Rs 830 crore (2,400 persons); Grasim Industries — Rs 750 crore (300 persons) and Ampere — Rs 700 crore (1,459 persons).

CM inaugurated 8 completed projects worth Rs 3,377 crores:

The CM also inaugurated eight completed projects worth Rs 3,377 crores, which can create employment for 7,139 persons.

  • These projects include a four-wheeler manufacturing unit by France-based PCA automobiles in Tiruvallur, and AG&P’s CNG Mother Station at Ramanathapuram.
  • He also dedicated the state’s recently launched first City Gate Station in Ramanathapuram District.

Laying of foundation stone:

The CM also laid the foundation for 10 new industrial parks.

–These include foundation stone for the formation of four new Industrial Parks of SIPCOT at Manapparai, Maanallu, Oragadam, and Dharmapuri.

  • These parks will cater to the requirements of the automobile and auto component sector, food processing, general engineering industries, E-vehicle manufacturing, and Textiles sector by providing employment opportunities for more than one lakh persons.

–The rest foundation stones were laid for six industrial estates of TANSIDCO in various districts that would help generate employment to 13,300 people

Additional Info:

–TN has attracted a total investment of Rs 6.85 lakh crore in ten year period.

–In 2020, the state unveiled the Tamil Nadu Electronics Hardware Manufacturing Policy, 2020, and has set an ambitious target to increase electronics industry output to $100

Recent Related News:

i.On January 22, 2021, the India Africa Trade Council 2021 was inaugurated in Hotel Crowne Plaza, Chennai (Tamil Nadu) for building up business relations between India and Africa.

ii.A New Species of Fruit Fly has been named ‘Euphranta Siruvani’ after it was discovered in Siruvani, Coimbatore district of Tamil Nadu. The discovery has been published in the Zootaxa Journal.

About Tamil Nadu:

RAMSAR sites– Point Calimere Wildlife and Bird Sanctuary
Airport– Chennai International Airport, Madurai International Airport, Coimbatore International Airport, Tiruchirapalli International Airport