THE TIMES OF INDIA

Monday , June 22, 2009 at 0233 hrs IST

Stalin wants Chennai as new financial hub : Moots Study To Draw Roadmap For Proposal.

CHENNAI- Based on an idea put forward by deputy chief minister M K Stalin, the state government is working on a plan to project Chennai as a potential financial hub.

In his first stint as Chennai’s mayor in 1996, it was Stalin who branded the city as ‘Singara Chennai’ (beautiful Chennai) before embarking on a modernisation plan.

Now, at the seat of power at Fort St George in his new capacity as deputy CM of Tamil Nadu, Stalin seems to be keen to ensure the state draws more investments and facilities in the financial sector.

WHAT WORKS FOR THE CITY

* It is a hub for electronic manufacturing services and automobiles.

* A high talent pool and concentration of IT and ITES firms.

* Home to ABN Amro's BPO, Citibank's transaction processing and World Bank's Centres.

* Indian Bank, IOB, Karur Vysya, Lakshmi Vilas, City Union and Tamilnad Mercantile have already made Chennai their Main Centre.

PLAN TO MOVE BIZ TO TIER II, III TOWNS.

Tamil Nadu is mulling the possibility of

including a clause in all infotech contracts to

ensure 30 to 40% of the tech work go to

Tier II and Tier III locations. We are

readying physical infrastructure,"

government sources told TOI.

Though government officials are refusing to divulge details, Stalin is apparently keen to nurture an ecosystem of banks and financial institutions. “It is only an idea, but the deputy chief minister wants to make this happen. It might sound a long shot now, but the first step is ideation in any process which is happening now,” sources said.

Sources said the deputy chief minister wanted a study commissioned to explore the possibility of realising this vision and to prepare a roadmap for this purpose. Officials at the trade body, the Confederation of Indian Industry (CII), said they had so far not been approached for consultation, but added, “We are working towards a similar goal.”

Essentially, the plan would aim at leveraging the city’s growing clout as a favourable destination for electronic manufacturing services (EMS) and automobiles.

The city is already the first port of call for investments in these two sectors. Over the last decade, the city has also seen a concentration of business process outsourcing (BPO) activities and software services. Similarly, if more financial activities are diverted to Chennai, the possibility of the city emerging as a financial hub gets stronger.

“A place like Chennai, if it provides that kind of an ecosystem, a lot more players like investors and lenders can trade, and corporates can raise money here. In India, any company that wants to raise money has to go to Mumbai... there is no alternative financial hub,” K Ramakrishnan, CEO of Spark Capital said.

By T K Rohit, TNN