Date:19/09/2008 URL: http://www.thehindu.com/2008/09/19/stories/2008091955500600.htm

Tamil Nadu - Chennai

Subsidies not within reach of micro-industries in Ambattur

Shyam Ranganathan

Survey conducted by Tamil Nadu Small and Tiny Industries Association

CHENNAI: More than 92 per cent of micro-enterprises in the Ambattur area run on rented premises and many of these are unable to avail themselves of the government’s subsidies, a survey conducted by the Tamil Nadu Small and Tiny Industries Association (TANSTIA) has found.

According to the Micro Small and Medium Industries Policy of the Tamil Nadu government, micro units can avail themselves of a 15 per cent subsidy on plant and machinery. But the government has stipulated that a 5-year lease agreement be signed for rented premises.

The survey has found that most owners are ready to sign only a 1-year lease agreement, and this prevents micro-entrepreneurs from getting the benefits of the policy.

When contacted, G. Santhanam, Director, Industries and Commerce, said that he had already forwarded a recommendation to the government to reduce the period to 11 months with a renewable clause in the agreement.

Similarly the survey found micro industries in the area not availing themselves of the 20 per cent electricity tariff subsidy because more than one enterprise sometimes shared single premises.

The study and survey, funded by Tamil Nadu Industrial Investment Corporation (TIIC) to the tune of Rs. 5 lakh, was a pilot project to create a database of micro-industries outside industrial estates, Sheela Rani Chunkath, chairman, TIIC, said.

“We have initiated this because there is no complete database of what micro-industries function where and we do not even know if some units have folded up.

The government can proceed from here to prepare a comprehensive database for the whole state,” she said.

The survey found that over 3,000 micro enterprise units around Ambattur provided employment to 14,626 people, with an average employment of 4.8 per unit. Of these units, 373 function in cramped areas of 100 square feet.

A. Shanmugavelayudhan, president, TANSTIA, said the survey showed that micro-industries working in the same field could come together to benefit each other mutually.

Lack of information in the form of a credible database was preventing this, he said.

He said that the proposed “flatted complexes” housing similar industries together would help them, and suggested that the government expedite the process to build the complexes.