Tamil Nadu invites Kitex to invest after company withdraws project in Kerala

The Tamil Nadu government is attempting to entice a major garment manufacturing company based in Kerala to relocate after a major spat with its home state’s government. The Tamil Nadu government has greeted one of Kerala’s leading industrial enterprises, Kitex, with a red carpet welcome after it announced the cancellation of its 3,500 crore investment in the state. Kitex Chairman Sabu Jacob told a TV channel that he has received calls from six states since his declaration on June 29 that the company wants to pull out of certain projects in Kerala.

On behalf of the state Industries Department, Guidance Tamil Nadu, the primary investment promotion agency of the Tamil Nadu Industries Department, has addressed a letter to Kitex. In the letter, Associate Vice President of Guidance Gaurav Daga claims that Sabu Jacob met with Tamil Nadu Industries Minister and that the letter was drafted afterward.

Sabu Jacob revealed that Tamil Nadu offered him a 40% subsidy, land at half the market value, 100% stamp duty relaxation, 5% tax reduction for 6 years, 25% subsidy for environmental protection infrastructure, 50% subsidy for intellectual property, Rs 4,000 per month for six months of training for each employee, electricity subsidy, and other benefits. However, the company is yet to decide whether or not to relocate its operations to Tamil Nadu. According to sources, Kitex has been approached by Telangana.

Kitex Garments, the world’s second-largest children’s garment maker, has announced the cancellation of a Rs 3,500 crore project for which it signed a memorandum of understanding with the Kerala government in January 2020 at the “Ascend Global Investors Meet” in Kochi. The plan was to create industrial parks in Thiruvananthapuram, Kochi, and Palakkad, as well as an apparel park in Kochi.

Sabu Jacob expressed his thoughts as follows: “Six Indian states have already welcomed us, and I’ve already received calls from their Chief Ministers, Industries Ministers, and Principal Secretaries. Even when we declared that we were pulling out of a massive investment of Rs 3,500 crore, not a single clerk called me from Kerala.”

“The Tamil Nadu government’s offer is attractive, and I’ve learned that our neighbouring state offers a wide range of services. However, a decision to relocate from Kerala must be made after extensive deliberation with our staff and management… it will not happen overnight, but it is something we are seriously considering.”

“The government of Tamil Nadu has also stated that they are willing to provide anything in addition to these offers.”The prominent industrialist stated that the offer from Tamil Nadu is too good to refuse, and that it has boosted his morale, which had been low following the Kerala government’s “victimisation.”

“The attitude of the Kerala government is very crucial…,” he added, adding that the state government was not even providing any subsidies, including for power, and that it was all profit for the state government. “Even after this, there is no professional interest being envisaged by it.” I don’t believe that the current government, or even the current opposition, had a comparable mindset while they were in office.

Jacob stated, ” “I’m fed up with Kerala and its government… In the last month, 11 teams of officers from various authorities have raided the company. Searches were undertaken by the Departments of Labor, Factories, and Boilers. Officers from the pollution control board also arrived at our factory and inspected every nook and cranny, grilling our personnel for hours.”

“We’ve been operating here for 26 years and employ 11,000 people. The Kerala government is anti-industry, and we are treated as bourgeoisie, exploiters, encroachers, and even criminals, and we are publicly humiliated.” The Kerala Chamber of Commerce and Industry has previously spoken out against Jacob’s treatment and demanded that he be punished severely.

Kerala Industries Minister P. Rajeev responded to the situation two days ago, saying the government was in discussions with Kitex. He did, however, say that citizens should not criticise the government without first conducting a conversation.

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