The Hindu Business Line : Big city dreams

But there is more to Tuticorin than just the port, and therein lies the grouse of its industries. Bad roads, poor connection by rail and air, and lack of good hotels or entertainment centres.

For all that, companies on a global scale have achieved the lowest costs, drawing from a large workforce, good power supply, abundant land — real estate prices are fast increasing — and yes, a good seaport. Many industries across sectors such as non-ferrous metals, fertilisers, chemicals, small and medium industries including traditional industries like salt making, seafood exports, garment exports made it their home.

Yet, it is a small dusty town. It wants to grow into a big, modern city.

Copper town

One of the big-ticket players is Sterlite Industries Ltd of the Vedanta group, a company that is involved in over 4 per cent of the world's copper production. It produces about a million tonnes of copper cathodes and copper rods a year, and 40 per cent of that is from its unit in Tuticorin.

Over 30 per cent of Tuticorin's port facility is devoted to handling Sterlite's materials, 5 per cent of Tuticorin's population is `engaged with Sterlite,' according to company officials.

Mr R. Kishore Kumar, Chief Executive Officer, Sterlite Industries, believes that the State Government should have promoted Tuticorin as a manufacturing hub a long time ago.

But doesn't its location affect the town's prospects as an investment destination?

Skills pool

Look at the facilities here, he says. There is the port, more than 2,000 MW of power supply, large tracts of land, water and a good workforce. The human resource is a primary contributor to making Sterlite a benchmark for industries in Japan, US and China. Sterlite is the lowest-cost copper smelter, according to Mr Kumar.

Sterlite employs 800 workers and 600 are from local areas and Coimbatore, Tiruchi and Tirunelveli. It also has 1,200 contract workers entirely from Tuticorin and its neighbourhood.

But things are changing fast. India's labour cost is `modestly cheap' and fast increasing. The Government has to look at creating facilities that will keep it competitive.

Poor links

For Tuticorin, its road connection is a strong point. It is linked to Tirunelveli and Madurai and to the rest of the country from there.

"But look at its airport," he says. For the first time since April it has started functioning with one flight a day to Chennai. No night landing facilities. Even if you arrive in your own aircraft, you'll have to leave by four in the evening because the airport closes at 5.

And there are no international standard hotels in Tuticorin.

Rail link is another problem — just one train a day to Chennai and another to Bangalore.

Alternative to Chennai?

Mr Joe Villavarayar, President, All India Chamber of Commerce and Industry, and a leading freight forwarder, says Tuticorin can be developed as an industrial hub, an alternative to Chennai.

Tuticorin has as much to offer — its port can be developed to handle car exports and there is a lot less pressure for space. The industry body has approached the State Government to promote an automotive industry and components park.

Efforts are on through the Outer Harbour Project to expand the Tuticorin port with 8-10 berths, of which four would be dedicated to container handling. A port-based SEZ in partnership with TIDCO is also in the pipeline, he said.

A dedicated industrial corridor could be set up along the NH 46 that links Tuticorin to Madurai. The coast road also needs to be developed.

Low employee cost

Mr Villavarayar said academic institutions in Tirunelveli (about 120 km away) provide skilled workforce.

He himself operates a BPO unit and a number of BPO units are in operation. Employee cost is a fraction of that in Chennai with starting salaries around Rs 3,000.

But Tuticorin needs quality schools and modern facilities. Some modern hotels by hotel chains like Meridien and GRT are in the offing, he said.

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