Chennai (Tamil: சென்னை)’s Economy - Debrief

Formerly known as Madras, Chennai is the capital of the state of Tamil Nadu and is India's fourth largest metropolitan city. It is located on the Coromandel Coast of the Bay of Bengal. With an estimated population of 7 million, the average literacy rate is 80%, much higher than the national average of 50%. 20% percent of the city's population is classified as living in slum conditions. Chennai is among the densest cities in the world in terms of population per area. The majority of the residents of Chennai are Tamils / Tamilians and speak Tamil. English is also widely spoken, especially in business, education and other white collar professions. Tamil spoken in Chennai uses words from other languages such as English, Telugu and Hindi liberally and is referred to as Madras bhashai(Tamil for "Madras language").

Chennai is the third largest commercial and industrial center in India. Chennai is considered the automobile capital of India, with a major percentage of the automobile industry having a base here and a major portion of the nation's vehicles being produced here. This has led to Chennai being referred to as the Detroit of South Asia. Chennai is the base for around 49 per cent of India's auto components industry and 34 per cent of the vehicle industry. A large number of the automotive companies in India are based in Chennai. Several global and Indian automotive companies such as Hyundai, Ford, BMW, Mitsubishi, TVS, Ashok Leyland, Caterpillar, Royal Enfield, TI Cycles, TAFE, Dunlop, MRF have manufacturing plants in and around Chennai. Hyundai has a major engine plant in the city. The Heavy Vehicles Factory, Avadi produces military vehicles, including India's main battle tank: Arjun MBT. The Railway Coach building factory of the Indian Railways, the Integral Coach Factory manufactures railway coaches and locomotives.

Since the late 1990s, software development and business process outsourcing and more recently manufacturing have emerged as major areas in the city's economy. 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. Software services giants like Accenture, Cognizant Technology Solutions, CSC, EDS, HCL, HP, IBM, Infosys, Satyam, Sun Microsystems, TCS, Verizon and Wipro 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, when completed, will provide employment to close to 300,000 people. The Mahindra World City, a Special Economic Zone (SEZ) is one of the world's largest information technology parks.

Multinational corporations like Dell, Nokia, Motorola, Cisco, Samsung, Siemens, Sony-Ericsson, Flextronics and Foxconn have or are in the process of setting up Electronics / Hardware manufacturing plants in the Sriperumbudur electronics SEZ . Ericsson and Alcatel have research and development facilities in the city while Texas Instruments' R&D facility is in the pipeline. Semiconductor companies like SPEL and Tessolve have announced plans to set up or expand manufacturing and R&D centers in the city. The city has two main biotechnology parks, TICEL bio-tech park and Golden Jubilee bio-tech park at Siruseri that house biotechnology companies and laboratories.

Several Petrochemical companies like Chennai Petro Chemicals Limited (CPCL), Manali Petro Chemicals Limited, Madras Refineries Limited (MRL), Petro Araldite and Orchid Pharmaceuticals are situated in the outskirts of Chennai.

Chennai is an important center for banking and finance. At present it is home to three large national level commercial banks and many state level co-operative banks. Several large financial companies and insurance companies are headquartered in Chennai. Many Indian banks, multi-national banks and the World Bank have located their back office operations in the city. The city serves as a major backup center for operations of many banks and financial companies in India. The city has a fully computerised stock exchange called the Madras Stock Exchange.

The city is also home to the Tamil entertainment (motion pictures, television, and recorded music) industry which is the second largest in Indian entertainment industries. Because the film industry is largely centered around a local area called Kodambakkam, the Tamil film industry is popularly referred to as Kollywood. The industry makes about 300 Tamil movies a year, and its film soundtracks dominate the music scene in the city.

Transport (of which we are now part of..)

Popularly known as "Gateway to South India", Chennai is well connected internationally and to other parts of India. Five major national highways radiate outward towards Kolkata (Calcutta), Bangalore, Trichy, Tiruvallur, and Pondicherry. The Chennai Mofussil Bus Terminus (CMBT), is the largest bus station in South Asia. The city is connected to major hubs in South Asia, South East Asia, the Middle East, Europe and North America through over thirty national and international carriers. The airport is also the second busiest cargo terminus in the country.
The Chennai Port and Ennore Port contribute greatly to the city’s importance. The Chennai port is India's second busiest container hub handling general industrial cargo, automobiles etc. The Ennore port handles cargo such as coal, ore and other bulk products.

The Chennai Central station, which is the city's largest railway station, has trains to all the major cities like Mumbai, Kolkata, Bangalore, Delhi, Hyderabad, Coimbatore and towns in India.Buses and trains are the most popular form of public transport. The main problem Chennai faces is traffic congestion and resulting pollution. Chennai has a fairly well developed transportation infrastructure in terms of coverage and connectivity. The majority of city's population uses public transportation thus burdening the system which gets overcrowded during peak hours.

(the story of our train trip to Bangalore to follow...)