Boost For Industries In Puducherry

The industrial corridors from Chennai to Bangalore and Chennai to Vishakapatnam as announced in the Union Budget is expected to generate a lot of activities which will benefit industries in Puducherry, especially those in the manufacturing sector.

“The industries can get a market to supply components manufactured by them in Puducherry to large industries that will come up on the corridor”.

M S Vijayaraghavan, former chairperson, CII Puducherry and Partner, Hexell Plastik Peripherals told the Express, “Several auto component manufacturing units have come up in Puducherry and some of them are going in for expansion. Such units will find buyers there. However, there is a need to improve the connectivity, especially the Puducherry-Chennai ECR. The four-lane that is proposed needs to be realised.”

In the Budget this boost in the manufacturing sector is likely to pick up and its effect will also be felt in Puducherry. “Though the Centre has focused on micro, small and medium enterprises (MSME), the growth in the MSME sector depends on the kind of plans the Centre unveils, “said Vijayaraghavan. As Puducherry has more than 4,000 functional MSME units, the growth of this sector will impact the economy.”

The harassment faced by the existing industries is generating a negative feedback. Several senior members of the industry feels that a lot of effort is needed for industrial growth in Puducherry with the industries getting discouraged by the policies of the government, labour issues and a non-conducive industrial climate.

Some big names like Suzlon and HCL (manufacturing) have closed their units and moved out, while NCR has announced its decision to move out of Puducherry. Even existing industries are expanding their units in neighbouring TN instead of Puducherry.  A few of them have just established their new units in TN area adjoining the Puducherry-TN border at Gorimedu.

“The systematic approach in TN, the handling and processing of applications, the well laid down set of rules and the advantage of land availability have led to the turn of things,” said an industrialist, “Some time ago, even for ordinary routine processes like renewal of factory licence, there were several hurdles. Non-conducive environment triggered by government lethargy and irregularities along with labour problems have led to the exit of industries.”

Most industrialists believe that the IT sector is not sustainable in Puducherry. Units like IT which manufacture white goods (which directly go to consumers) will prefer States that give concessions on excise duty and sales tax.

“Manufacturing units that sell their products to other industries can get tax credit, but consumers cannot give tax credit,” said a CII member,” Under these circumstances, the SEZ-IT planned by the government is also not a viable proposition.”