In the fast-changing industrial space in Chennai, the Oragadam industrial corridor has emerged a hub for supply chain and logistic services. Having attracted around Rs 25,000-crore investments from 120-130 small to big companies from across different sectors, the corridor, is expected to attract more investments in the coming years.
?Driven by the huge domestic demand, skilled labour pool and huge suppliers network in and around Chennai, the Oragadam industrial corridor has transformed Chennai?s industrial space and could attract over Rs 20,000 crore from leading auto manufacturers, auto component companies, FMCGs, logistics/warehouse service providers, IT and ITeS operators and a host of FMCG companies,? said Sanjay Upendram, former director, KPMG and the co-founder and CEO, Amarthi Management Consulting.
Oragadam?s good connectivity with Bengaluru, Kolkata, Vizag, Vijayawada, Kochi, Trivandrum and a few major cities in the western region has set an unprecedented example for other industrial corridors. Costs for logistics in India stand at 13-14% of GDP, compared with 8-9% for developed countries.
?The government has given impetus to the logistics sector by allowing 100% FDI, eliminating CST, introducing VAT, improving multi-modal transportation through projects such as dedicated freight corridor, encouraging public private partnership and 100% income tax exemption for port development projects, Upendram said.
Oragadam owes its strategic advantage to a large manufacturing presence, demand base, supplier presence, established infrastructure and multi-modal connectivity. It is also well connected to the Chennai port, the Chennai Central railway station and an international airport.
According to Upendram, Oragadam industrial corridor has seen some major investments by large Indian and global players from automotive, FMCG/durables and industrial products during the last few years due to a special boost provided by the Tamil Nadu government.
Across the automotive industry, Oragadam represents an excellent hub for manufacturing and distributing, as more than six automotive OEMs and over 50 suppliers are located close to each other in the Oragadam-Sriperumbudur cluster. This will enable supply of domestic and imported parts in a just-in-time approach. Companies such as Nissan-Renault, Mercedes, Daimler, Delphi-TVS, Komatsu, GKN Driveline, Apollo Tyres, Sundaram Auto Components have set up major bases in this corridor.
Similarly, for FMCG and durable goods companies, Oragadam will become a gateway and logistics hub for the rapidly-growing population of south India.
The region?s proximity to Sriperumbudur?home to large manufacturing companies such as Hyundai, Ford, Saint Gobain, Nokia, Dell etc?will benefit the region. A six-lane highway road (SH57) is being constructed to connect these twin towns.
The growth is likely to drive the need for seamless supply chain and logistics to cater to the Indian and global markets. Several global and Indian logistics players like DHL, Realtime Logistics, ShriKailash Logistics have either set up their logistics hubs or in the process of setting them up in this region.