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Promise of a productive year

The activity level of CII (SR) promises to reach new heights. B Santhanam who took charge as Chairman(SR) for 2013-14 outlined an impressive programme of priorities for the current year.

HIS THEME OF accelerating growth through focus on competitiveness, infrastructure, inclusion and social responsibility promises a lot of purposive activity spread over the southern region. With his predecessor, Sanjay Reddy of GVK industries, pre-occupied with his overseas businesses through last year, activity level did drop but then the economy as a whole too, was recording a very slow growth.

I remember the hectic activity imparted by Santhanam in his earlier tenure as the Chairman CII (TN). With his record in building Saint-Gobain Glass India as the largest manufacturer of high quality flat glass in the country in quick time and taking charge for a larger territory covering plants and markets in South Asia and Egypt and expanding manufacturing base to Gujarat and Rajasthan, Santhanam brings with him enviable manufacturing and marketing expertise. CII has also been benefiting from his rich contributions to skills development, which happily has evolved into an important plank of the government’s development initiative.

Bright scope for industry-institute co-operation

This product of IIT-M and IIM-A has been active in building industry-institute collaboration. He has been actively involved in the IIT-M Research Park and recently helped establish one of the global research centres of Saint-Gobain in IIT-M Research Park. I am, therefore, convinced that this tenure of Santhanam will be eventful.

There is concern over the competitiveness of India falling in recent years. The incremental capital output ratio is estimated to have dropped from 4:1, at the peak of the growth boom of 2005-08 to an estimated 6:1 today. Santhanam promises to address this issue, especially for the MSME sector, by focusing on common R&D facilities, testing centres, automation, business mentoring services and senior expert advisory services.

Santhanam pointed to the finance minister mentioning in his budget speech, the setting up of 15 technology development centres.He pointed to the evolution of the robot as an important device that has become affordable by medium and small enterprises to upgrade quality, efficiency and profitability of operations. CII(SR) proposed to win a technology development centre for robotics/automation and another for additive manufacturing  for two cities of south India.

Water efficiency...

CII will provide impetus to sustainability, said Santhanam, through energy efficiency audits, cost management, waste management, water use efficiency and the promotion of environment. In particular, he expressed concern over the profligacy in water usage and indicated efforts to address this. CII(SR) will advocate a water policy at the state level, he said.

Infrastructure has been a major thrust area of CII. Santhanam pointed to two major initiatives for southern region. The first one relates to the development of an industrial cluster in southern Tamil Nadu: “the Madurai-Tuticorin hub would receive a big boost with the proposed Rs 7000 crore investment on the Tuticorin port. With a draught of 18 metres, which is deeper than that of Nava Sheva, Tuticorin port can receive very large carriers. We can look forward to big ticket investments in this region,” he said.

The second relates to the Chennai-Bengaluru industrial corridor. IE has special reason to feel excited about this prospect. As early as 2007, IE organised a seminar urging on the priority for this corridor along with a dedicated rail line that would reduce travel time from Chennai to Bengaluru at just an hour! With Japan evincing interest (it is funding the DMIC), CII(SR) should bring together Tamil Nadu, Karnataka and Andhra Pradesh to win this project in quick time.

Stress on southern gas grid

For close to 25 years, IE has also been demanding a fair share of natural gas consumed in the country. In December 2009, at a seminar participated by business leaders from Tamil Nadu and policy makers from Andhra Pradesh, Kerala and Tamil Nadu, IE demanded a gas grid for the south. At the seminar, Santhanam pointed to the elegance, efficiency and economy of natural gas and pointed out that switching to natural gas from furnace oil can increase his company’s profitability by Rs 100 crore a year! So IE is happy over the plan of Santhanam for a CII study on the roadmap for  creation of the southern gas grid.

The CII chairman expressed hopes on Tamil Nadu slowly coming out of the power problem: the medium term outlook appears better, he said. However, he expressed concern over Andhra Pradesh suffering serious shortage.


CSR exchange to pool resources...

Santhanam is known for his pragmatism. While welcoming the recent legislation mandating companies with turnover of Rs 100 crore to set apart at least 2 per cent of their profits for CSR initiatives, he pointed to the practical difficulty on the effective utilisation of the resources set apart: “a Rs 100 crore turnover company can have a PAT of Rs 5 crore and can set apart Rs 10 lakh for CSR. How to utilise this effectively? For Rs 10 lakh a company may not get an effective project,” said Santhanam. He suggested creating a CSR exchange for pooling such allocations.  

Navas Meeran who has taken charge as Deputy Chairman is bound to benefit immensely by his participation through this year of hectic activities planned. This should be of special value to Kerala poised to get CII leadership for the southern region for the first time.

Mahesh Natrajan returns to Chennai after several years of stint at New Delhi and has taken charge as Regional Director. Incidentally, he teamed up with Santhanam when the latter was Chairman Tamil Nadu. So an exciting period is ahead for this team.Best wishes Santhanam!  
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