The Tamil Nadu government has doled out a slew of incentives for investors in the aerospace and defence manufacturing sectors.

In its new Tamil Nadu Aerospace and Defence Industrial Policy 2019, which was released at the Global Investors Meet (GIM) 2019, the State said that units which are allotted land within three years from the date of announcement of this policy in the industrial parks, aerospace and defence parks promoted by State Industries Promotion Corporation of Tamilnadu Ltd (SIPCOT) and the Tamil Nadu Industrial Development Corporation (TIDCO) will be given 20% concession on the actual land cost.

The State government would give anchor unit subsidy at the rate of 10% of the eligible fixed assets (subject to a ceiling of ₹10 crore) to each of the first ten aerospace and defence original equipment manufacturers/suppliers investing ₹50 crore (or above) providing employment to over 50 people.

Additional subsidy

Those investing in the southern districts will be given an additional subsidy.

There are subsidies for the certification process too, as 50% of the cost of certification from Indian and international bodies for multiple products and certificates would be reimbursed subject to a ceiling of ₹25 lakh for companies setting up manufacturing units in Tamil Nadu.

And 50% net State Goods and Services Tax (SGST) paid by MRO (maintenance, repair and operations) operators in Tamil Nadu would be refunded.

The single-window facilitation mechanism under the Tamil Nadu Industrial Guidance Bureau would be made available for the entire aerospace and defence related manufacturing and infrastructure projects, irrespective of their investment size.

Cluster development

The government in its policy has also said that it would adopt cluster development approach in building the aerospace and defence manufacturing ecosystem by creating the required physical infrastructure.

The government would facilitate development of aerospace and defence clusters in the potential locations, which includes Chennai, Coimbatore, Kancheepuram, Krishnagiri, Salem and Tiruchi.

It would focus on areas like component manufacturing, MRO, research and development, centre of excellence with common facilities such as warehouses, testing and certification facility.