Historical Development of Industrialisation in Tamil Nadu
lot of evidence for presence of industrial activities such as textiles,
ship-building, iron and steel making and pottery in precolonial Tamil Nadu.
Given the vast coastline, the region has been involved in trade with both
South-East and West Asia for several centuries. Colonial policies also
contributed to the decline of the handloom weaving industry due to competition
from machine-made imports from England. But some industries also developed
during the colonial period.
two sets of factors that have contributed to the process. The introduction of
cotton cultivation in western and southern Tamil Nadu by the colonial
government led to the emergence of a large-scale textile sector in these parts.
increase in trade during this period led to industrial development around two
of the most active ports in the region, Chennai and Tuticorin. Match factories
too emerged during the colonial period in the Sivakasi region, which later on
became a major centre for fireworks production and printing. Port-related
activity too contributed to the growth of the region. Leather production was
also taking place in Dindigul, Vellore and Ambur areas.
Western Tamil Nadu, the emergence of textiles industries also led to demand and
starting of textile machinery industry in the region. This textile machinery
industry in turn led to the rise of a number of small workshops for repair and
producers of machinery components. Another major development in the western
region is the introduction of electricity from hydro-electric power in 1930s.
Availability of electricity allowed for use of oil engines for drawing ground
water. This led to both expansion of agriculture as well as increase in demand
for oil engines. In turn, it led to emergence of workshops for servicing
engines and also for addressing the demand for spare parts. Foundries began to
be set up and agricultural machinery began to be produced.
after independence, several large enterprises were set up by both the central
and state governments in different segments such as the Integral Coach Factory
in Chennai to make railway coaches and the Bharat Heavy Electricals Limited
(BHEL) in Tiruchirapalli manufacture to boilers and turbines. BHEL in turn led
to the emergence of an industrial cluster of several small firms catering to
its input requirements. Heavy Vehicles Factory was set up to manufacture tanks
in Avadi on the outskirts of Chennai. Standard Motors too started manufacturing
cars in Chennai. Ashok Motors (later Ashok Leyland) and Standard Motors
together helped form an automobile cluster in the Chennai region. The Avadi
industrial estate was established in the 1950s to support the small and medium
companies supplying to the large firms in the region. More hydro-electric power
projects in the state were also initiated to increase the spread of
electrification. The government played a major role in all these processes. The
Salem Steel Plant was set up in 1973 to produce stainless steel.
and 1980s saw the setting up of emergence of powerloom weaving clusters in the
Coimbatore region as well as expansion of cotton knitwear cluster in Tiruppur
and home furnishings cluster in Karur. This period also saw more encouragement
of the small and medium sector with setting up of industrial estates by the
state government in different parts. The Hosur industrial cluster is a
successful case of how such policy efforts to promote industrial estates helped
to develop industries in a backward region.
phase of industrialisation is the post-reforms period since the early 1990s.
The reforms made the state governments more responsible for resource
mobilisation and they were forced to compete with each other to attract private
investments for industrialisation. Incentives such as cheap land, tax
concessions and subsidised but quality power were all offered to woo investors.
Trade liberalisation and currency devaluation also helped open up export
markets. This led to two major developments.
important industries in the state that evolved over a much longer period
include sugar, fertilizers, cement, agricultural implements, iron and steel,
chemicals, transformers and paper.
of all these factors, Tamil Nadu at present has the largest number of factories
among all states in India and also has the largest share of workforce employed
in manufacturing. Importantly, it is more labour intensive compared to other
industrially advanced states like Maharashtra and Gujarat. The major industries
are automobiles, auto-components, light and heavy engineering, machinery,
cotton, textiles, rubber, food products, transport equipment, chemicals, and leather
and leather goods. Unlike other states, the industries are spread across all
regions of the state (there are 27 clusters in 13 districts) with many of them
being export oriented as well. The state has a well- developed network of
roads, rail, air and major ports.