Tamil Nadu Economy & Vision 2023 - IMaCS

Tamil Nadu Economy & Vision 2023

26 - 27 June, 2002

Madras Chamber of Commerce & Industry

29th September 2012 Chennai

R. Raghuttama Rao

Managing Director, IMaCS

v

Recent Trends in GDP Growth – all India

9.3%

6.8%

8.3% 8.4%

6.5%

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

2008 2009 2010 2011 2012

Deceleration

across all sectors

Real GDP growth

down to 6.5% in

FY12, which is the

lowest since FY03

© IMaCS 2012October 3, 2012

Page 2

v

GDP growth of southern states

3

2008 2009 2010 2011 2012 2008-12

TN 6.1% 4.9% 9.4% 11.7% 9.4% 8.3%

Karnataka 12.6% 7.1% 5.2% 8.9% 6.4% 8.0%

Kerala 8.8% 5.6% 8.9% 9.1% 7.8% 8.3%

Puducherry -1.3% 47.8% 3.4% 3.7% 3.9% 9.0%

AP 12.0% 6.9% 6.0% 10.0% 6.8% 8.0%

Five Southern

States

9.8% 6.1% 7.3% 10.1% 7.7% 8.2%

India 9.3% 6.8% 8.3% 8.4% 6.5% 7.8%

Tamil Nadu has grown faster than the country average over the last three years


Page 3

v

Composition of Tamil Nadu’s GDP

4

Sector 2010 2011 2012

Agriculture & Allied 9% 8% 8%

Industry 19% 18% 18%

Services 72% 73% 74%

TOTAL 100% 100% 100%


Page 4

v

Key economic indicators of TN have improved in FY12

5

Parameters 2010-11 2011-12

Revenue surplus -0.5% 0.1%

Fiscal Deficit 3.04% 2.61%

GSDP Growth (constant prices) 11.7% 9.4%

State own tax revenue to GSDP 8.7% 9.5%

Non tax revenue as a % of tax

revenue

9.7% 10%


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The Vision for Tamil Nadu for 2023 is to become

India’s most prosperous and progressive state with no

poverty, and where its people enjoy all the basic

services of a modern society and live in

harmonious engagement with the environment and

with the rest of the world.

Vision 2023


Page 6

VISION 2023 - TARGETS, THEMES AND STRATEGIES


Page 7

Key outcome of Vision 2023

1. The per capita income of Tamil Nadu’s residents will reach $ 10,000

per annum (at 2010 prices) by 2023 - in line with that of Upper Middle

Income countries

2. Tamil Nadu will attain a high standards of social development, with the

Human Development Index of the state matching those of developed

countries by 2023

3. Tamil Nadu would provide to its residents, high quality infrastructure all

over the state comparable with the best in the world.

1,625 1,200

10000

12,275

-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

TN (2010) India (2010) TN (2023)Pe

r C

ap

ita

In

co

me

$

(Cu

rre

nt

pri

ce

s)

Low Income

Lower Middle Income

Upper

Middle

Income

3,975

1,005 © IMaCS 2012October 3, 2012

Page 8

HDI targets 2023 – aim to be the best in India

Parameters (as of 2011) India TN Kerala

Population in Crore 121 7.21 3.33

Annual Growth Rate 1.6% 1.5% 0.5%

Sex Ratio 940 995 1084

Total Fertility Rate 2.6 1.7 1.7

Crude Birth Rate 2009 22.5 16.3 14.7

Crude Death Rate 2009 7.3 7.6 6.8

MMR 2007-09 212 97 81

IMR 2009 50 28 12

Under 5 MR 64 33 14

HDI indicators

Education

Achieve universal

secondary education

Step up enrolment

in higher education

(including vocational

education) to >50 %


Page 9

Vision Themes

Vision Themes

Economic Prosperity

Inclusive Growth

Health for All

World Class Infrastructure

Investment Climate

Knowledge Hub

Peace and Security

Heritage and

Ecology

Protection Against

Vulnerability

Governance


Page 10

Strategies to achieve Vision 2023...1

1. Increasing the share of manufacturing in the state’s economy

Manufacturing growth rate should be accelerated to facilitate

employment generation

Sector 2004-05 2010-11 2022-23Avg. annual

Growth rate (%)

Primary 12% 12.6% 7% 5.1%

Manufacturing 20% 16.6% 22% 13.8%

Non manufacturing 11% 9.2% 8% 9.5%

Services 57% 61.6% 63% 11.1%

Total 100% 100% 100% 10.9%

2. Make SMEs vibrant in the state


Page 13


3. Making Tamil Nadu the

knowledge capital and

innovation hub of India

Thrust on innovation across

agriculture, manufacturing,

services, administration, and

finance

a. Skilling 20 million persons over

the next 15 years

b. Fostering a social climate and

institutional structure that will

encourage free movement of

people to and from other states

of India and the globle

Centres of Excellence

Automotive technologies

Solar and clean energy

technologies

Biotechnology

Agricultural practices

Water resources

management

Construction

management

Lifestyle diseases

Aerospace

Basic sciences

Nano technology

Social sciences


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4. Specialisation in service offerings

Specialisation is the key to attracting investments and rapid growth. In

the area of Services, the state will strive to be a leader in the

following areas:

a. Back office operations

b. Healthcare

c. Audio and Video - production and post production

d. Tourism


Page 15


5. Thrust on skill development The single most important resource for the success of Vision 2023 is

the availability of trained, knowledgeable and skilled manpower in

Tamil Nadu. Aim is to train and skill 20 million persons over the next

11 years

Formally educated

(skilled)

Specialised

jobs

(highly skilled)

Large pool ( Minimal Skilled - No

formal education)60 - 65%

1 - 2 %

33 - 39%

Total demand – 20 million

12 -13

million

6.6 – 7.8

million

0.2- 0.4

million


Page 16


6. Improving agricultural productivity

Vision 2023 has a three-pronged strategy for improving agricultural productivity :

a. Adopting scientific agricultural methods and building an institutional network

to support the continued adoption of the same

b. Ensuring timely irrigation by adopting effective recharging mechanisms,

drip/sprinkler irrigation systems, timely cleaning and deepening of tanks and

canals, and adopting appropriate cropping pattern

c. Developing suitable post harvest infrastructure to maximise the benefits of

value addition and timely marketing of produce.


Page 17


7. Transforming ten cities into world class cities

Develop ten world class cities which will become the nuclei and

engines for economic growth, thereby facilitating regional and balanced

development across the state.

Universal access to 24x7 water supply and efficient mass transit

systems while making them open-defecation free and garbage free

will be the hallmark of these cities.


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8. Thrust on social welfare programmes

The vulnerable and disadvantaged sections will be extended protection by the state and will be equipped to take advantage of the benefits of the economic growth


Page 19


9. Signature projects

a. Develop world class Centres of Excellence in at least 10 areas that act as

nuclei of innovation

b. Set up two medical cities in southern and western Tamil Nadu

c. Double water storage capacity across the state

d. High speed broadband connectivity to be reached to every village

e. Two supercritical and other power projects of cumulative 10000 MW capacity

f. Gas grid connecting ten large cities

g. 2000 km of 6/8 lane highways

h. High speed rail connecting Chennai - Coimbatore - Madurai - Kanyakumari

i. Three green field ports and 5 minor ports with total cargo handling capacity of

150 million tonnes per annum

j. Greenfield airport near Chennai with an annual capacity of 40 million

k. Development of industrial corridors between Chennai - Hosur, Madurai -

Thoothukudi and Coimbatore - Salem


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10.Encourage Public Private Partnership (PPP) in

infrastructure project creation

The total investment requirement for infrastructure over the 15 year

period is estimated at Rs 15,00,000 crore (~US$ 330 billion). Under

the PPP mode, the Government will play the role of a change agent

and will originate infrastructure projects in line with Vision 2023, and

will also focus on the important functions of regulation and overall

governance.


Page 21

Key imperatives to achieve Vision 2023 targets

Key Assumptions Present Projected

Revenue surplus (estimates for 2011-12) -0.25% 1.5% (by 2015)

Fiscal Deficit 3.04% 3% (by 2012)

GSDP Growth (estimates for 2011-12 at

constant prices)

9.4% 11% (by 2017)

State own tax revenue to GSDP 8.7% 10% (by 2012)

11% (by 2017)

Non tax revenue as a % of tax revenue 9.7% 13%

Share of central taxes as a % of GSDP

(13th Finance commission)

2% 2.58%

Infrastructure investment to GSDP 5% (approx) 10% (by 2015)

12% (by 2021)

Note: The last column mentions the value for the parameter from the year indicated till 2023© IMaCS 2012October 3, 2012

Page 22

Break-up of infrastructure investments over the next

11 years

Sector Investment Requirement

Rs. Crore

Energy 450,000

Transport 370,000

Industrial and Commercial 160,000

Urban Infrastructure 275,000

Agriculture 40,000

Human development (Health & Education) 30,000

Sub-total 13,25,000

General and Social infrastructure projects 1,00,000

Capital improvements to existing projects 75,000

Sub total 1,75,000

Grand Total 15,00,000


Page 23

Expected funding mix of infrastructure projects

Year

Investment in

Infrastructure

(Rs. crore)

State

Government

(%)

Central

Government

(%)

Private

Sector

(%)

2010 25,000 60% 25% 15%

2016 93,705 33% 30% 37%

2023 237,690 28% 30% 42%


Page 24

In summary

Vision 2023 is a bold statement aiming to make Tamil Nadu the numero

uno state in the country

Vision 2023 is a guide that seeks to channel the ambitions of a modern

democratic state towards a desirable and aspirational future

Vision 2023 straddles developmental outcomes across different

spheres – economic, social, human development, infrastructure,

agriculture, environmental, etc to improve the quality of life

Vision 2023 has stretch targets – inspiring and challenging, and

eminently reachable

Vision 2023 is a challenge for all stakeholders –Government, politcal

leaders, civil servants, industry, institutions, communities, civil society..


Page 25

Thank you

For any clarifications on this document, please contact:

R. Raghuttama Rao

email: [email protected]

© IMaCS 2012

October 3, 2012

Page 26

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Tamil Nadu Economy & Vision 2023 - IMaCS