Tamilnadu’s decentralized industrial model.

Syllabus: GS-III, Subject: Economy, Topic: Industry and Industrial policy, Issue: Tamilnadu’s industrial model

Context: Tamilnadu is the most economically diverse state in India

      Tamil Nadu’s decentralized industrialization model

  • Medium-scale businesses rather than large corporations drive TN’s economic transformation.
  • The state’s industrialization is decentralized, with clusters specializing in various industries.
  • Major clusters include Tirupur for cotton knitwear, Coimbatore for spinning mills and engineering goods and Sivakasi for safety matches and firecrackers.
  • These clusters have created employment opportunities in small urban and peri-urban centers, reducing dependence on agriculture and migration to big cities for work.
  • TN’s entrepreneurial culture spans diverse communities.
  • Entrepreneurship from below, combined with investments in public health and education, has propelled TN’s industrialization and diversification beyond agriculture.
+1 advantage for mains ( case study Tamilnadu’s Economy)

·                Tamil Nadu is India’s top state in terms of economic complexity, boasting a diverse GDP and employment profile.

·                The farm sector’s contribution to TN’s gross value added (GVA) and employed labor force is below the national average, indicating lower dependence on agriculture.

·                TN’s economy is characterized by higher shares of industry, services, and construction compared to the national average.

·                Gujarat, despite being more industrialized than TN, has a higher share of agriculture in its GVA and workforce, making its economy less diversified.

·                TN’s agriculture sector is notable for its emphasis on livestock, with 45.3% of farm GVA coming from this subsector, the highest in India.

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