Tamil Nadu to introduce new focused policy for automotive MSMEs

Tamil Nadu, one of the automotive hubs in the country, is working on a draft policy to help MSMEs (micro, small and medium enterprises) in the state to become competitive. 

MSMEs are the backbone of the automotive supply chain and a key element in the growth of automotive industry in Tamil Nadu. The state government is now looking to address their issues.

Speaking on this new policy initiative, Ambuj Sharma, Industries Commissioner and Director of Industries of Commerce, government of Tamil Nadu, said, “We are working on a Tamil Nadu-specific plan for MSMEs involve in the automotive sector. We have done a first round of meetings with SIAM and ACMA representatives, with a few companies attending the meeting. The major focus of this group is demand creation, technology, R&D and skills upgradation.”

“We have 13 focused sub-sectors of which the auto sector is the prime focus area,” said Sharma. The new policy is expected to finalised in the next 2-3 months. Sharma added that Tamil Nadu has a specific mission plan for encouraging and expediting, enhancing and accelerating growth in the automobile and auto component sector.

“The Tamil Nadu government has been always very encouraging for the automotive industry. The state has been among the three leading hubs in the country and provides a lot of land and various schemes for the industry and focus area for auto and auto components. Technology and R&D would a be big component of this policy to help the auto sectors in policy intervention and specific intervention in terms of financing, providing land and built up space,” he added.

Sharma, who has been instrumental in forming the government of India’s ambitious projects at the national level including the mission plan for electric vehicles, the Automotive Mission Plan, and electrical and electronic equipment mission plans for the next decade, is looking to help accelerate the auto industry in Tamil Nadu.

Strong automotive hub
Tamil Nadu traditionally has been a strong automobile and auto component industry hub. It is home to a host of vehicle manufacturers across vehicle categories. On the passenger vehicle front, it houses the manufacturing plants of Hyundai Motor India, Nissan Motor India, Renault India, Ford India and BMW India. Commercial vehicle and tractor makers Ashok Leyland, Daimler India Commercial Vehicles, Kamaz Vectra, TAFE and Caterpillar India have their facilities in this southern state. And in two-wheelers, it is the home of Royal Enfield, TVS Motor Co and more recently, India Yamaha Motor.

The component industry is also a strength for Tamil Nadu what with key Tier 1 suppliers such as the TVS Group, Rane Group, Tenneco India and a host of Tier 2 and Tier 3 suppliers. While MSMEs play a critical role in helping companies source components, they are unable to achieve their potential due to a financial and governmental support. The new policy focus on MSMEs will go a long way in giving them new traction.