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With a tepid response to Global Investors Meet, has Tamil Nadu lost its tech mojo?

According to sources, state officials are also trying to reach out to Vishal Sikka, Narayana Murthy and Azim Premji.

Updated: Aug 14, 2015, 10.09 AM IST
According to sources, state officials are also trying to reach out to Vishal Sikka, Narayana Murthy and Azim Premji.
According to sources, state officials are also trying to reach out to Vishal Sikka, Narayana Murthy and Azim Premji.
CHENNAI: Amid all the congratulatory mails for his elevation, new Google CEO Sundar Pichai can expect a snail mail from the Tamil Nadu government inviting him to the Global Investors Meet (GIM), to be held in Chennai on September 9 and 10.

State officials are also trying to reach out to Vishal Sikka, Narayana Murthy and Azim Premji, according to sources in the know.

But with less than a month to go for the summit, some in the IT sector wonder if the government is cutting it too fine even as last-ditch efforts are being made to rope in big participation from the IT sector for GIM, which aims to boost investments in the state. State bureaucrats have two days ago returned after an exhaustive trip to the US and Europe, aimed at bringing in IT participation and investments into Tamil Nadu during meet. While government officials involved in organising the summit say they are doing their best, industry sources say the response from the global IT sector has been lackluster.

A source who did not wish to be identified said when the state government officials were making their pitch to companies in the US, they had to face tough questions including ones about “governance issues“. While the officials are said to have “defended and pushed forward“ the government's interest in attracting IT investments, the industry representatives abroad seemed unconvinced, the source added.

Major IT companies and fast-growing companies from the Silicon Valley have not expressed interest in participating or signing deals with the Tamil Nadu government despite the pitch made by the officials.

A senior bureaucrat closely involved with the meet said: “We are giving it all our efforts. The IT secretary has just now returned from California. We are roping in some new IT companies. Some of the bigger companies have not yet responded. We are reaching out to Sundar Pichai to ensure that Google's participation is there in GIM.“

Some industry sources said the state has failed to market its potential in the IT sector.

Taking Uber as an example, a source said: “Tamil Nadu was one of the first states to issue licence to Uber in an absolute hassle-free manner. But when Uber wanted to set up their office, they chose Andhra Pradesh. The state must start marketing itself aggressively to attract investments from the IT and new-generation companies. Tamil Nadu has the best talent pool for this sector but there is no pull or push to ensure that additional jobs are created here by attracting new IT investments.“ Industry representatives said there are at least 6,000 IT companies in Tamil Nadu providing employment to about 3.75 lakh people, the second highest in the country. At least 10 large IT companies have their presence in Tamil Nadu and they are growing at an average of 12% a year.

But with senior leaders in the government failing to make an aggressive sales pitch projecting the state's potential, newer IT companies are staying away from the state, an industry representative said, requesting anonymity.

Officials, however, were quick to point out that the scene on other sectors including manufacturing and automobile was brightening up gradually. A top government official working on garnering investments said five large MoU in the automobile space, accounting for ` . 20,000 crore, have come in so far.

The total tally so far has gone beyond the stated target of ` .1 lakh crore, he added. He said sectors such as food processing have got a healthy investment rate. Electronics, which took a setback after Nokia and Foxconn left, has also got some investments, he said.

The country's second-largest truck maker, Ashok Leyland, makes most of defence trucks in its plant Tamil Nadu.

Asked if Tamil Nadu would be considered should the company look at expansions, chief financial officer (CFO) Gopal Mahadevan said: “The state has good quality labour, port access and a cluster of auto component makers. We had set up a factory in Pantnagar only for the excise duty advantage.But if we have to consider expansions, it's only in Tamil Nadu and Pantnagar in Uttarakhand.“

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