Tamil Nadu: One of the Most Sought-After Investment Destinations in India

The federal state of Tamil Nadu, located on the southeastern coast of India, significantly contributes to the Indian economy and has achieved substantial economic growth over the decades. It is the second largest economic power in India and one of the most sought-after investment destinations due to its strategic location, business environment, top-notch infrastructure, active management, and favorable ecosystem.

Home to Various Industries

It is known as a state of diverse industries, with Chennai being the capital of the automotive industry in India. It accounts for 35 percent of India’s automotive component production. The state has 1,300 factories for the production of motor vehicles, trailers, and semi-trailers, and 45 percent of total Indian automobile exports before the COVID-19 pandemic came from this federal state. Tamil Nadu has the largest renewable energy capacity in India – 16 GW, ranking ninth in the world in renewable energy production.

Tamil Nadu is home to more than 120 companies manufacturing aerospace components, and it is one of the two Indian defense corridors, with over 700 suppliers.

Major Exporter

It is also not lagging in the IT sector, with 16 percent of electronics in India produced in Tamil Nadu. The state ranks second in India in the production of computers, electronics, and optical products, and third in the export of electronic devices ($1.63 billion) in the financial year 2018 – 2019. With an 11 percent share of total IT investments in India, Tamil Nadu is a desirable IT destination and home to leading global organizations such as IBM, Cognizant, TCS, Infosys, HCL, World, Accenture, Bank, Amazon, etc.

An advantage of Tamil Nadu is that it is the closest point to major manufacturing ecosystems such as China, Korea, Taiwan, Japan, and ASEAN. The state has separate manufacturing clusters for automobiles and components, electronics, IT, textiles, aerospace, food processing… It accounts for 9.25 percent of total Indian exports, with $30.5 billion in exports primarily of automobiles, leather, finished garments, and footwear.