Budget 2014: The Jaya-Modi friendship comes good for Tamil Nadu

There is not a single big story for Tamil Nadu in the Narendra Modi government’s maiden budget, but its overall share of the allocations are reasonably good.

Not surprisingly, other than the CPM and the Congress everybody else has hailed the budget. Most interestingly, both Chief Minister Jayalalithaa and DMK chief M Karunanidhi have only good to things to say about it.

The pick of the announcements for Tamil Nadu is Tuticorin’s outer harbour project at a total outlay of 11,635 crore. Although this has been a UPA project, Jaitley has presented it in the budget. The entire cost of the project will be borne by the central government.

Other Tamil Nadu highlights of the budget included a smart city at Ponneri, in northern Chennai, the ultra mega solar power initiative, national institute of ageing at the Madras Medical College and a mega textile cluster. Out of this, the solar power initiative, the textile cluster and the national institute of ageing are the new government’s decisions while the other two have been UPA decisions. While an initial allocation is made for the Tuticorin port project, there is no allocation for the textile cluster indicating that it could have been a last minute addition.

In addition, Kanchipuram and Velankanni have been included for development as heritage cities under the National Heritage City Development and Augmentation initiative. That two of the six cities announced under the scheme are in Tamil Nadu is another shot in the arm for the state.

The allocations for various projects, including existing initiatives and government of India institutions such as IGCAR at Kalpakkam, Neyveli Lignite Corporation, and Institute of Mathematical Sciences in Chennai add up to about Rs 6000 crore. The highest allocations are for Chennai Petroleum Corporation (Rs 1102 crore) and Tuticorin Port Trust (Rs 420.85 and 173 crore)

Ponneri is one of the three smart cities that are envisaged under the Chennai-Bangalore industrial corridor. Other cities included are Krishna Pattinam in Andhra Pradesh and Tumkur in Karnataka. The blueprint for these cities has been prepared by JICA. The smart city in this northern suburb will come up over 300 hectares and will include industrial parks and commercial and residential areas. The funding support will also come from JICA. A number of Japanese companies are setting shops in this area.

The other infrastructural development initiative for Tamil Nadu is the textile cluster. However there is no allocation or details about the project in the budget. Going by the announcements for Lucknow and Kutch, where they will be set up for traditional embroidery and chikan work, there will be some emphasis on the nature of support in Tamil Nadu. Apparently, it’s yet to be decided. The state already has two textile clusters - one in Virudu Nagar for handlooms and the other for powerlooms.

Interestingly, the budget has an announcement that spells out Chennai, but includes nothing for Tamil Nadu - the Vizag-Chennai industrial corridor. The government has included 20 industrial clusters in this corridor, but none of them is in Tamil Nadu. Jayalithaa, while welcoming the budget announcements, has pointed this out and asked the Centre to link the Madurai-Tuticorin corridor that the state is developing with the Vizag-Chennai corridor. She also suggested the inclusion of Sreerangam in the heritage city initiative.

So in toto, the state has managed a fair deal that covers various sectors such as industries, urban development, institutional infrastructure and tourism.

In comparison, the neighbouring state of Kerala will have to be content with an IIT and the spillover benefits of other announcements.