Chennai Economy

Due to hectic industrialisation of city suburbs, the economy of Chennai Metropolitan Area (CMA) has grown to $58.6 billion in terms of PPP (purchasing power parity).

At present, CMA is rated as the fourth largest economy in India and third highest GDP per capita. The metropolitan area includes the city proper and the nearby industrial zones of Sholinganallur, Siruseri, Oragadam and Sriperumbudur.

Ever since the process of liberalisation (in early 1990s), Chennai has been on steady growth in terms of diversifying its manufacturing base, expanding its services -- software, BPO, banking and finance -- and giving a concerted push towards small and medium enterprises across the city.

According to the Confederation of Indian Industry, Chennai's economy is expected to reach $100 billion - 2.5 times its present size − by the year 2025.

Called the 'Detroit of India', Chennai boasts of a number of global car and automobile manufactures who have found this city the right place to ramp up production and further export to Southeast Asian markets.

Apart from auto manufacturers, the city has a wide range ofcompanies in clusters doing business in software services, hardware manufacturing, financial services and medical tourism.

Some of the other sectors like petrochemicals, textiles and cement further embellish Chennai as a city of wealth creation and a source of huge productivity, thus adding to the national income.

Top ten cities of the world

Nearly 4.6 million people live in Chennai, making it the sixth-most-populous city in India.

Chennai has been named among the top 10 cities to visit in 2015 by a leading global travel guide with the list being topped by US' capital Washington. Lonely Planet's Best in Travel 2015 has come out with a list of top 10 destinations in different categories such as best countries to visit, best regions to visit, best cities to visit and many more such guiding lists for travel.

In the category of top 10 cities, Chennai has been ranked ninth, ahead of Canada's Toronto.

An international airport and a busy Chennai port enhance theimage of efficient connectivity which raises the index of business confidence in Chennai. A well networked highways and railways link even the remote areas of the state which is the most urbanised region in the country.

Chennai was rated as having the highest quality of life among Indian cities ahead of the other three metros and Bangalore, based on the "Location Ranking Survey" conducted by ECA International.

According to a 2007 worldwide quality of life survey done by Mercer, Chennai received the second highest rating in India, with New Delhi scoring the highest, and came in at a relatively low 157th worldwide.

The reason was attributed to poor health and sanitation, and the increasing air pollution. As of 2012, the city has about 34,260 identified companies inits 15 zones.

Of these, 5,196 companies has a paid-up capital of over Rs 5 million, about 16,459 companies are in the paid up capital range of Rs 100,000 to Rs 200,000, and 2,304 companies have a paid-up capital of less than Rs 100,000.

An industrial pioneer

Industrialisation in the city dates back to the 16th century, when textile mills manufactured goods which were exported to Britain during its war with France.

In the late 18th century, it became the only city in Asia tomanufacture car engines and ancillary parts for ships and battle tanks.

Chennai is the only Indian city to be rated in the "Forbes-Top 10 Fastest Growing Cities in the World".

It is ranked 4th in hosting the maximum number of Fortune 500 companies of India, next only to Mumbai, Delhi and Kolkata. The city is also home to 24 Indian companies having net worth of more than $1 billion.

Automobile hub of India

The city is a base to around 30 per cent of India‘s automobileindustry and 40 per cent of the automobile components industry.

A large number of automotive companies including Hyundai, Renault, Nissan Motors, Ashok Leyland, TVS Motor Company, Royal Enfield, TI Cycles, TAFE, Daimler AG, Caterpillar Inc., Komatsu Limited, Ford, BMW and Mitsubishi have manufacturing plants in Chennai.

The Heavy Vehicles Factory at Avadi produces military vehicles, including India's main battle tank: Arjun MBT.

The Integral Coach Factory at Perambur manufactures railway coaches and other rolling stock for Indian Railways. Banking on skilled professionals, the automobile MNCs are ready to invest huge amounts to set up factories and expand their existing ones to cater to both domestic and export markets.

A number of auto-ancillary firms have set up operations in and around Chennai which has developed a sound eco-system for the growth of automobile industry. Chennai is also famous for leather products and accessories accounting for more than 50 per cent of India‘s leather exports.

2nd largest exporter of IT services

Since the late 1990s, software development and business process outsourcing and more recently electronics manufacturing have emerged as major drivers of the city's economic growth.

Chennai has been rated as the most attractive Indian city for offshoring services according to A.T. Kearney's Indian City Services Attractiveness Index 2005.

Major software and service companies like Infosys, TCS, Wipro, Cognizant, Satyam, Aricent, Accenture, Capgemini, CSC, EDS, SAP AG, Oracle Corporation, Cisco Systems, HCL, HP, IBM, Sun Microsystems, Symantec, Verizon, CSS Corp and US Technology Resources, Dassault Systemes, eBay, Honeywell, VMware, Intel, Amazon, Tech Mahindra, Igate Patni, Adobe Systems, AT&T, Mindtree, Ford Sync, Ramco Systems, Bosch, Deloitte, CA Technologies and Microsoft have development centres in the city.

The city is now the second largest exporter of IT and IT-enabled services in the country behind Bangalore.

The IT corridor, on Old Mahabalipuram Road in the southeast of the city houses several technology parks and provides employment to close to 5 lakh people.

Besides the existing Tidel Park, two more Tidel Parks have come up on the IT corridor thus providing the much needed office space for start-ups and emerging companies in the software sector.

One is located at the Siruseri IT special economic zone (SEZ) and the other one is situated at MGR Film City which is just before the existing Tidel Park at Taramani on the IT Corridor.

A number of SEZ have emerged in and around Chennai. The Mahindra World City, New Chennai, a Special Economic Zone (SEZ) with one of the world's largest high technology business zones, is currently under construction in the outskirts of Chennai. It also includes the world's largest IT Park by Infosys.

Electronics hardware units thrive

Despite the exit of mobile handset maker Nokia and its vendor Foxconn from the Chennai market, the electronics industry is booming in the city and its extended suburbs.

While nearly 30,000 people employed in Nokia plant have lost their jobs, they can feel optimistic that there are many companies in the SEZs around Chennai who will observe them sooner or later for their enhanced skills.

In recent years, Chennai has emerged as an electronic manufacturing hub in South Asia with MNCs like Dell, Motorola, Cisco, Samsung, Siemens, Sony-Ericsson, Nokia and Foxconn setting up electronics and hardware manufacturing plants, particularly in the Sriperumbudur electronics SEZ.

Thus Sriperumbudur SEZ alone would have netted a total investment of $3.5 billion over the decade or so.

Chennai is currently the largest electronics hardware exporter in India, accounting for 45% of the total exports in 2010-11. The Central government has planned to promote Chennai as the electronic manufacturing and R & D hub of the world in a span of 15 years.

Ericsson, Alcatel, Atmel, Texas Instruments, Xerox and Siemens have research and development facilities in the city. Semiconductor companies like SPEL and Tessolve have announced plans to set up or expand manufacturing and R & D centers in the city.

Companies like Nokia, Flextronics, Motorola, Sony-Ericsson, Flextronics, Samsung, Cisco, and Dell have chosen Chennai as their South Asian manufacturing hub. Products manufactured include circuit boards and cellular phone handsets.

Sanmina-SCI is the latest company to invest in Chennai to create a state of the art manufacturing facility. Petrochemicals, textiles, finance, BPOs Chennai Petroleum Corporation Ltd (CPCL) with its refinery complex at Manali, garment units in the suburbs and a number of private firms offering financial and back office projects to clients across the world make Chennai a diversified base for industrial growth.

What is most noteworthy is that Chennai‘s population is expanding horizontally at a rapid pace as the suburbs and neighbouring districts have latched on to the industrial bandwagon.

As employment opportunity grows in Chennai Metro region, social infrastructure like housing, roads and transport services have been put in place for the growth of satellite townships. Kollywood - the big money spinner

In the 1950s, Chennai is the hub of moving making for South India as Tamil, Telugu, Kannada and Malayalam films were shot at its sprawling studios - AVM Studios and Vijay Vahini Studios, are the biggest.

Tamil cinema plays an important role in moulding the psyche of Chennai people and there is always a good patronage to films with novel content.

Hence, producers scout for good stories and scripts for converting them into films which will assure them more than double the return on investment within a short time.

Kollywood is the third biggest industry after Bollywood and Tollywood. But, according to cine buffs, in terms of creativity and technical skills Tamil films are far ahead of other regional films in the country.