CEIC Data Blog

Manufacturing Industries in Tamil Nadu


India Data Talk: The Annual Survey of Industries (ASI) 2009-2010, conducted by the Ministry of Statistics and Programmed Implementation, evaluates the industrial scenario in India from April 2009 to March 2010. The survey provides statistics on such major industrial characteristics as number of factories, capital, workers, wages, product input and output, and value added. This information could be useful for business planning and policy formulation by both industry players and government authorities.

According to the ASI 2009-2010, Tamil Nadu recorded 1.89 million persons engaged in the manufacturing sector, the highest among all states and union territories in India. During this period, the amount of fixed capital in Tamil Nadu rose by 35.9% to INR 1.33 trillion. This increase in fixed capital contributed greatly to the expansion of gross output from INR 3.01 trillion in 2008-2009 to INR 3.76 trillion in 2009-2010 and to a vast increase in net value added, from INR 397.14 billion the previous year to INR 591.55 billion in 2009-2010. As one of the most industrialised states in India, Tamil Nadu has been an economic leader over the years. This is especially evident in Tamil Nadu’s capital, Chennai, which is one of the fastest growing cities in India and host to a large portion of India’s manufacturing industries.

Composition of Net Value Added (%)India Manufacturing
Chart provided by: CEIC

During the 2009-2010 period, Tamil Nadu saw increasing emphasis in three sectors, namely, machinery and equipments (M&E), chemical and chemical products (C&CP), and computer, electronics and optical products (CE&O). The M&E sector, in particular, accounted for 16.72% of total net value added compared with 11.14% in the previous year, overtaking the motor vehicle sector as the top contributor to the total net value added of Tamil Nadu’s manufacturing sector. The C&CP and CE&O sectors meanwhile accounted for 3.71% and 3.61% of total net value added, respectively, up from 2.36% and 2.73% during the previous year although their contribution in terms of total net value added remained small.

Because of current economic uncertainties, growth in India’s Industrial Production Index (IPI) has hovered below 7% since the third quarter of 2011. Indeed, IPI growth has normalized since a period of high growth during early 2010, when the IPI increased at double digits. Despite the observed turbulence in the short term, strong growth in Tamil Nadu’s capital investment suggests healthy long-term prospects for its manufacturing sector.

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By Chan Yee Lui – CEIC Analyst

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