16 views 6 mins 0 Comment

Tamil Nadu tries to make the most of Kitex group’s tiff with Kerala

- July 2, 2021

Chennai, July 2(BPNS)

The Tamil Nadu industries department is trying to rope in one of the major apparel manufacturing company based out of Kerala who has had a major tiff with the state government and planning to shift its base from its home turf.  It seems that Tamil Nadu is trying to gain from Kerala’s disadvantage.

One of the largest industrial groups of Kerala, Kitex which had announced the cancellation of its 3500 crore investment from the state, was given a warm red-carpet welcome by the Tamil Nadu government.

 The Tamil Nadu industries department’s, Associate Vice President (Guidance Tamil Nadu) , Gourav Gaga had sent the invitation to the KITEX group on behalf of the state Industries minister. However, the group is yet to decide whether it would shift its operations to Tamil Nadu or not.

Kitex garments are the second-largest children’s apparel manufacturer in the world. The company announced the scrapping of the Rs 3500 crore project for which it had signed a memorandum with the Kerala government. The MoU was signed at the “Ascend Global Investors Meet” in Kochi in January 2020. The project was to open an apparel park in Kochi and establish industrial parks in Thiruvananthapuram, Kochi, and Palakkad in Kerala.

KITEX Chairman, Sabu Jacob while speaking to BPNS said, “ Six states in India have already invited us and I received calls from Chief Ministers, Industries ministers, and Principal secretaries of these states. However, not even a UD clerk called me from Kerala even after we announced that we are backing out from a mammoth investment of Rs 3500 crores.”

Sabu Jacob said, “The offer given by the Tamil Nadu government is irresistible and I came to know that this much facilities are being provided by our neighbouring state. However, a decision to shift from Kerala has to be taken after a lot of consultations with our team, our management and it will not happen in a day but we are seriously contemplating.”

Sabu said that Tamil Nadu offered him a 40% subsidy, land at half the market value, 100% relaxation on stamp duty of the land, 5% tax reduction for 6 years,25% subsidy for environmental protection infrastructure, 50% subsidy for intellectual property, 4000 rupees per month for the training of each employee for six months, electricity subsidy, and several other freebies.

He said, “ The Tamil Nadu government has also said that they are willing to provide anything over and above these offers.”

The noted industrialist said that the offer from Tamil Nadu is too good and that it has raised his morale which was low following the victimization by the Kerala government.

The successful entrepreneur said that the state of Kerala was not even providing any subsidy including for power and added that it was all profit for the state government but even after this, there is no professional interest being envisaged by the Kerala government.

Sabu said, “ The attitude of the Kerala government is very important, I don’t say that the present government, even the present opposition when they were in power was also having a similar attitude. As far as industries are concerned we are at the mercy of the local level leaders of political parties and even an Upper-division clerk in the state can scuttle the prospects of an industrialist. Kerala is lagging behind in industrial growth and the attitude of the rulers and bureaucracy is the reason behind this.”

It is to be noted that if the Rs 3500 crore project announced by the Kitex group would have materialized, then it would have given direct jobs to 20,000 people in the state. The three industrial parks at Thiruvananthapuram, Kochi, and Palakkad were designed in such a manner to promote start-ups providing infrastructural facilities.

Kitex was on the wrong side of the political establishment of Kerala after Sabu M Jacob floated a political outfit, “Twenty 20” which was earlier registered as a nonprofitable organization and the party wrested the power in the Kizhakkambalam panchayath of Kerala. In the recent assembly elections, Twenty 20 contested in six seats but could not win any seat.

Sabu M Jacob said, “I am fed up with Kerala and its administration, 11 teams of officers from various departments have raided the company in the past one month. Department of labour, factories, and boilers conducted searches. Pollution control board officers also reached our factory premises and searched every nook and corner of the factory and grilled our employees for hours.”.

He adds,” We have been functioning here for the past 26 years and employ 11,000 employees. The Kerala government is totally anti-industry and they treat us as bourgeoisie, exploiters, encroachers, and even are addressed as criminals and we are humiliated in public.”

 Kerala Chamber of Commerce and Industry has already come out against the treatment meted out to Sabu M Jacob and had called upon stringent action against the victimization of industries and industrial groups.

Kerala industries minister P. Rajeev was not available for comment even after repeated queries.