Southern Tamil Nadu has everything needed for all-round growth, and current trends indicate that the region is moving towards achieving its full potential.
SOUTHERN Tamil Nadu, comprising Madurai, Virudhunagar, Dindigul, Ramanathapuram, Tirunelveli, Tuticorin and Kanyakumari districts, has everything to recommend itself for all-round industrial development. It has a long coastline; the Vaigai and the Tamiraparani rivers irrigating parts of it; a well-run harbour at Tuticorin; a hub of spinning and weaving mills in Madurai, Rajapalayam and Theni; match and fireworks factories at Sivakasi; a big trading centre at Virudhunagar; reputed educational institutions in Madurai, Karaikudi, Tirunelveli and Nagarcoil; and a hill station at Kodaikanal. The south has had an excellent industrial climate as well. There are hardly any strikes in the factories in the districts.
Why then has this part of the country not attracted industries in a big way? Why is it known more for its temple towns of Madurai, Rameswaram and Kanyakumari? Is it because of a lack of infrastructure and a dearth of raw materials? Is it because of a paucity of trained manpower? Is political initiative wanting to project the south as the place to set up industries? Or have recurrent caste clashes squelched the chances of industries coming up here?
P.R. Ramasubrahmaneya Rajha, chairman, Ramco Group, a conglomeration of industries in diverse fields, asserts that there is no lack of entrepreneurship in the south, but industries were set up in the north as the market was there and therefore transportation costs could be avoided. "Only the market is the determining factor," he says. Ramasubramaneya Rajha is, however, confident that there is "good scope" in south Tamil Nadu for starting export-oriented units because there is a port at Tuticorin and the nuclear power project at Koodankulam and the special economic zone at Nanguneri will come up soon. He expects the Koodankulam Nuclear Power Project will trigger a lot of ancillary industries.
R. Dinesh, executive director, T.V. Sundram Iyengar and Sons Limited, Madurai, feels not enough is being done to promote southern Tamil Nadu as a destination for industries. It was seen as a tourist centre. "Even there, people visit the pilgrim centres of Madurai and Rameswaram in transit, and not as destinations in themselves."
Although southern Tamil Nadu does not lack in any major infrastructure, what deters investors is the lack of easy accessibility. It has poor air links. There is no airport in Tirunelveli or Kanyakumari. Madurai has air links only with Chennai and Mumbai, that too one flight a day. Dinesh said: "The perception of foreign companies is that Madurai is difficult to reach." A company from Spain gave up the idea of setting up shop at Madurai because it would take their executives three days to reach Madurai or any place in the south. Road connections are also poor. The East Coast Road, from Chennai to Kanyakumari, has not been completed. Train facilities are inadequate.
Lack of information is another deterrent. Dinesh said: "You have to create an impression among people that Madurai and Tirunelveli are the places to be in. The Confederation of Indian Industry should try to promote southern Tamil Nadu as a destination."
In the opinion of some industrialists, another factor that has hampered the growth of industries in the area is the recurrent caste clashes. Ramsubrahmaneya Rajha, however, disagrees. "Communal clashes have nothing to do with industrial activity," he asserts. Though Rajapalayam, where many of his industries are located, is a sensitive spot, the sporadic communal clashes have not affected his group at all.
Sekar Ponniah's friends "ridiculed" him for returning to his home town of Tirunelveli from the United States and told him about the area being a "communal hotspot" and of the lack of infrastructure. But he stuck to his decision. His Global Software Solutions (Tirunelveli) Private Limited, on the outskirts of Tirunelveli town, employs about 30 engineers. "For software, the main infrastructure needed is communication. To develop data, you can be anywhere. You can be at Tirunelveli or Courtalam, and transfer the data from a hut," Sekar Ponniah said. Global Software Solutions concentrates on providing the software for supply chain management and logistics, inventory control, warehouse management, enterprise resource solution, and the health care industry.
What made Sundeep Manghat, managing director of Meenakshi Foods (India) Private Limited, choose Madurai to establish his second biscuit manufacturing unit was the cooperative workforce. His company manufactures and markets biscuits under the brand name of "Craze". Its first unit was at Trichur, Kerala. As part of its expansion plan, another unit came up at Nagari, about 15 km from Madurai.
While one section is of the opinion that the south is industrially backward, another vehemently refutes it, pointing to the scores of mills in the region. These include the Ramco group's yarn mills at Rajapalayam; Thyagarajar Mills and Coats (Vyella), both at Madurai; two yarn units of Sundaram Textiles Limited, at Nanugneri in Tirunelveli district and Therkutheru in Madurai district; several ginning and textile mills at Theni; Tamil Nadu Cooperative Spinning Mill, Subburaj Textiles and Ganapathy Mills, in and around Tirunelveli town; Syed Cotton Mills at Nanguneri; and a couple of mills near Kallidaikurichi.
There are cement plants too: India Cements's plant Thazhaiyuthu and Ramco's near Virudhunagar. Kovilpatti has hundreds of match industries. Sivakasi is famed all over the country for its firecracker and printing units. Virudhunagar, a big trading centre, has a number of units making sesame oil. One that has made a name for itself is "Idhayam" sesame oil.
Tuticorin has boomed into a big industrial town. It has the Southern Petrochemical Industries Corproation (SPIC), which manufactures fertilizers; the Department of Atomic Energy's heavy water plant; Sterlite Industries, which manufactures copper; and the Tuticorin Port Trust. There are a number of handloom units at Sankarankovil near Tirunelveli and bamboo furniture units at Shencottah. Weaving of grass mats is an art at Pathamadai in Tirunelveli district. The mats, with artistic designs, are exported. There are big, reputed textile shops such as RmKV that specialise in selling silk saris, whose attraction is the theme-motif they have.
What has become a non-starter is the industrial growth centre, jointly promoted by the Centre and the State on a 2000-acre (800-hectare) site at Gangaikondan, about 13 km from Tirunelveli. It was to be a big industrial estate but failed to take off.
The hi-tech industrial park at Nanguneri, about 35 km from Tirunelveli, may take off soon. Advanced Technology Manufacturing and Assembling City (ATMAC) of the U.S. is the promoter of this park, built on over 800 ha. While ATMAC has 99 per cent equity in the project, the state-owned Tamil Nadu Industrial Development Corporation (TIDCO) has 1 per cent. Industries manufacturing semi-conductor parts and telecommunication and aeronautical components, and food-processing units will come up here.
The Ramco group of industries is a conglomerate that has not seen strikes. P.A.C. Ramaswamy Raja set up Rajapalayam Mills Limited in 1938 at Rajapalayam, a town about 90 km from Madurai. Under his son P.R. Ramasubrahmaneya Rajha the Ramco group does business worth Rs.1,500 crores a year in diverse fields such as the production of cotton and synthetic yarn, cement, high end software systems, asbestos sheets, surgical cotton, bandages and plaster of Paris; tissue culture; and so on. It has units in Tamil Nadu, Andhra Pradesh, Karnataka, Madhya Pradesh and Gujarat, and in Sri Lanka. The entire group has a workforce of about 6,000. The group exports textile yarn to some of the most demanding markets such as Japan, Hong Kong, Korea, Singapore, Australia and Malaysia.
A secret of the group's success is its focus on technology. Ramasubrahmaneya Rajha said: "Because of updated technology, good relations with workers and good quality, we are doing well in textiles." Its second-line (expansion) cement plant, commissioned on January 19, 2001, uses state-of-the-art machinery to produce 3,000 tonnes of cement a day. This plant, at Alathiyur in Perambalur district, was built in just nine months. Rajapalayam Mills, which was the first to produce open end yarn in India, belongs to the group.
Apart from its mills that export yarn, the group has three 100 per cent export-oriented units (EOUs), all located at Rajapalayam. "Seeing the success in exports, we are going to focus more on exports even in non-EOUs. These non-EOUs will export 75 per cent of their production," Ramasubrahmaneya Rajha said. His textile mills have had a good market because of the quality of the product. Using new technology, the company introduced a new type of yarn called compact yarn. "We are one of the earliest to adopt this technology," he said.
Ramco group's Madras Cements Limited has three units, at Virudhunagar and Alathiyur in Tamil Nadu and Jayanthipuram in Krishna district of Andhra Pradesh. It is doing "fairly well" despite the drought, an adverse market and the drop in prices. This is because the units are cost-efficient and energy-efficient and use the latest technology.
Ramco Systems is a global provider of information technology (IT) solutions and services in enterprise resource planning (ERP); enterprise asset management (EAM); human resource; and e-commerce. Employing more than 1,100 software professionals and business analysts, it has over 650 customer locations worldwide. According to Ramasubrahmaneya Rajha, Ramco Systems has developed a new software which will reduce the programme time, and many multinationals were seriously looking at it. Ramasubrahmaneya Rajha's son P.R. Venketrama Raja is in charge of Ramco Systems.
The manufacture of asbestos fibre cement sheets, pressure pipes, corrugated sheets for industrial roofings, and flat sheets for interiors falls under the purview of Ramco Industries Limited. About 200 windmills for the generation of electricity have been set up by the group at Muppandal in Kanyakumari district. The group runs a string of charitable and educational institutions including schools, an industrial training centre and a polytechnic.
Ramasubrahmaneya Rajha's "dream of starting a spinning mill in the north" will come true with a mill in Gujarat starting production from January 2003.
ANOTHER strong presence in southern Tamil Nadu is T.V. Sundram Iyengar and Sons Limited, which has five plants. Sundaram Brake Linings at Kanjamanaickenpatti in Virudhunagar district (there is a plant also at Padi, Chennai) is a pioneer in manufacturing asbestos-free and asbestos-based brake linings.
Sundaram Industries has two divisions; a rubber division, started in 1962 and manufacturing moulded products for exports and the local market, and a tyre services division. It has two plants, one at Kochadai, Madurai, and another at Gurgaon. The tyre retreading unit uses the latest cold cure process.
Sundaram Textiles has units at Therkutheru and at Nanguneri. About 50 per cent of the synthetic and cotton yarn they make is exported.
Sundaram Fasteners has manufacturing facilities at Padi, Chennai; Krishnapuram near Madurai; and Pondicherry. They manufacture standard and special fasteners.
TVS Srichakra Limited at Madurai manufactures the entire range of tyres and tubes for mopeds, motorcycles, scooters and three-wheelers. It has developed a range of industrial pneumatic tyres, farm tyres and mining tyres.
TVS Cherry Limited, set up in 1994 at Vellaripatti on Madurai-Melur Road, near Madurai, as a joint venture with Cherry Electric Corporation, of the U.S., manufactures reed sensors and reed relays, and key switches and advanced performance/special purpose keyboards for information technology industry. "These are small items but their market will grow," Dinesh said.
TVS and Sons Limited, established in 1911, is the parent and holding company of the group. With a turnover of more than Rs.1,500 crores it is the largest automobile distribution company in the country.
Dinesh said the group was starting a string of repair shops for automobiles. Each would employ about 15 persons.
How an advertising blitzkrieg on television, aimed at women, plus stress on quality can boost the sales of any product is best exemplified by "Idhayam" sesame oil. V.R. Muthu, chief executive, VVV and Sons, Virudhunagar, which manufactures the brand of sesame oil, said that while the company sold 2,600 tonnes of oil in 1988 and 11,000 tonnes in 2000, the sales touched 12,284 tonnes in 2001. The turnover jumped from Rs.7.68 crores in 1988 to Rs.77.88 crores in 2001. The oil is available in Sri Lanka, Singapore, Malaysia, the Gulf countries and the U.S.
"If a product has to sell, it should be available and visible. Our strategy is based on this. It has worked wonders," said Muthu. "Our focus is on small customers because they are big numbers," he said.
Muthu's grandfather started the business of selling sesame oil in 1943. Until 1978, it was sold only in two districts. His father V.V.V. Rajendran founded the Idhayam group in 1986. Since then it has been a success story all the way. Another brand called "Delit" has also been introduced.
Since good-quality sesame seeds are not available throughout the year, they are carefully sourced from Tamil Nadu, Andhra Pradesh, Gujarat, Maharashtra and Rajasthan during different seasons. The oil is manufactured at two units at Virudhunagar. The group has diversified into the textile industry. Rasathe Hosieries was set up in 1996 to manufacture nighties.
The Madurai-based S.P.S. Jayam and Company too has effectively used the electronic and print media to advertise its Gopal brand of tooth powder and tooth paste. According to S.P. Selvaraj, its managing director, Gopal toothpowder is prepared with a combination of herbs and is popular in Tamil Nadu, Sri Lanka, Malaysia and Singapore. He said the toothpaste was rich in calcium and prevented bleeding in the gum. Selvaraj said the company also manufactured "Anjal Aluppu Marundu", a blend of herbs in the powder form which helped relieve body pain, headache and cold. Another product of the company is turmeric powder.
ON the road from Madurai to Kanyakumari, what strikes one is the hundreds of advertisements painted on compound walls for "RmKV wedding saris". "These painted advertisements are there 365 days in a year, 24 hours of the day and so they will get noticed," K. Viswanathan, a young B.Tech in textile engineering from the Indian Institute of Technology, New Delhi, and a partner of RmKV, a prominent textile shop in Tirunelveli, said. He added that he had brought in "an innovation, without changing the grammar of the silk saris, by introducing theme motifs" in them.
The first theme sari they introduced in 1997, based on the nationalist poet Subramania Bharathi's popular Tamil poem "Chinnam Chiru Kiliye", became an instant hit. Depicted on the sari are 33 dance poses, so intricately woven that even the danseuse's eye expressions are depicted. It still sells well.
Another theme sari has on its pallav the 90 floral designs found near the entrance to the Padmanabhapuram Palace in Kanyakumari district. Viswanathan and his brother Shivakumar took photographs of each of the 90 designs. Another sari of the same kind had flower designs with 3-D effect. These two saris won the national awards for master craftsmen and master weavers in 1998.
Yet another sari, portraying the story of Nala and Damayanthi, also won two national awards in 1999. "We spent more than Rs.5 lakhs in R&D in setting up the looms and the design cards for this sari," Viswanathan said. In 1999, this sari also won the two national awards.