Research Article

IT and ITeS Industry in Tamil Nadu With

Reference to ELCOT
C Paramasivan1, M Selladurai2
Abstract
In the present situation, India is the finest destination for IT and IT enabled services through technopreneurs
in the world. The IT and IT enabled corporation in India was recognized by all over the universe for their
effective business related activities. The Indian IT industry has got a great success and also contributes a
lot in development of the economy. Electronics Corporation of Tamil Nadu Limited has been established
in the year 1977 and it has successfully completed its forty years of service towards the growth of the
nations economy as well as to give employment opportunities directly and indirectly to the society. ELCOT
is the IT hub for the technopreneurs in Tamil Nadu and allows its members to explore their talents all
over the world to satisfy the demands. This article describes the growth and expansion, current projects
with the major achievements of ELCOT in the current decade.

Keywords: ELCOT, IT and ITeS industry, Indian economy, Software Sector, Technopreneurs
Introduction
Information Technology is playing a key role in the modern business world which attracts products, process and promotion
of all kind of activities. With the advent of IT, it transformed into a advanced and application oriented technology in each
and every part. Tamil Nadu is the most preferred location for the multinational corporate in India. The year 2005 has
transformed Tamil Nadu and Chennai as a theme park for the information technology (IT) and information technology
enabled services (ITeS) sectors in the state. The two factors are witnessing an extraordinary growth in the state. The
state capital Chennai now holds all the top 10 MNC and Indian IT companies either one or more production firms. A
major promotional action of this growth is that medium-sized companies are also records high growth. Others also
agree that, the quality of human resources is the key factor of the state, which is ranked first in skilled and technical
manpower annual turnout (Chandrasekaran, 2005). The state provides space to more than 592 engineering colleges
and more than 650 arts and science colleges in its surroundings. The annual pass out of engineering graduates in the
state is over 99,000 the largest in India. Besides, Tamil Nadu generates nearly 60,000 diploma-holders from polytechnic
institutions. The corporate sector feels that, Tamil Nadu is the perfect destination to satisfy their needs with high skilled
professionals and talented graduates.

In the recent years, Tamil Nadu and particularly Chennai have attracted several hardware companies along with the
soft based companies. Hewlett Packard, Dell and Apple has arrived Chennai shortly along with the cluster of their
firms. Motorola also exploring their potential with renovation format. Some of the biggest hardware manufacturers
from Taiwan are also expected to set up their firms in and around Chennai. Software and hardware will make a good
combination in the future to make an identity to Chennai. Tamil Nadu will offer different locations to mould the platform
for specialists in different areas like technology software, systems software, engineering services, embedded systems,
infrastructure management (Sreeram Iyer, 2015).

1
Assistant Professor, 2Research Scholar, Department of Commerce, Periyar E.V.R. College (A), Tiruchirappalli, Tamil Nadu, India.

Correspondence: M Selladurai, Department of Commerce, Periyar E.V.R. College (A), Tiruchirappalli, Tamil Nadu, India.

E-mail Id: m.selladurai@gmail.com

Orcid Id: http://orcid.org/0000-0003-4855-833X

How to cite this article: Paramasivan C, Selladurai M. IT and ITeS Industry in Tamil Nadu With Reference to Elcot. J Adv Res Entrep
Innov SMES Mgmt. 2017; 3(3): 1-6.

ADR Journals 2017. All Rights Reserved.

Paramasivan C et al.
Review of Literature
Vijayasri GV had studied the impact of information
technology sector on the Indian economy.13 The information
technology sector has served as a basement for the growth
of a new entrepreneurial status with innovative business
practices and has been instrumental in with drawing the
brain drain, raising Indias brand image and attracting foreign
direct investment leading to other associated benefits. The
area of this sector has increased at an incredible rate of 35%
per year over the last 10 years. Its support to the national
gross domestic product is projected to be around 8.5 by
the year 2010-11. Exclusive subsidies and export incentives
were the stimulating way of the growth of IT sector.
Geetha V had discussed the institutional history of these
technology parks in India.11 The economic liberalization of
1991, the government of India established the software
technology parks of India scheme and opened numerous
software parks around the country. These parks have played
a critical role in the growth of Indias software sector.
In recent years, private software parks have also been
established in different parts of India. The government of
India is now promoting biotechnology parks to encourage
growth of this emerging sector. The biotech parks are still
in their infancy with a few operating parks and it will take
charge as soon as possible.
Rahul C had explained the rise and growth of Indias IT
industry. In general, ITeS covers all aspects of managing
and processing information.6 The last decade of 20th
century has witnessed IT sector have revolutionary effect
of the humanity. In the last two decades there is 20 times
increase in export revenues for the IT industry, employing
over two million people. Today the whole IT industry is
playing a major role in Indian economy and shows how
to analyse the growth and performance of information
technology industry in India. Various aspects of information
technology industry like composition, revenue, exports,
wealth creation, size and share, localization etc. were
studied.
Rao SR, Bagali MM had examined the acceptance of gender
diversity between employees and how the effect of diversity
management courses and practices has taken by different
IT companies and also investigates influence of difficulties
present in IT industry.7 The population for the study
comprises of employees from Information Technology firms
including IT servicing companies and ITeS-BPO companies
has situated at Bangalore. With the help of focus group
interview and discussions with HR managers of reputed
companies, questionnaire was developed by the researcher.
The tool was found to be reliable with advanced variables
framed in questionnaire.
Fernando PJ had identified some key situations that had
J. Adv. Res. Entrep. Innov. SMES Mgmt. 2017; 3(3)
optimistic or pessimistic relationships with the development
of the software and ITeS industry in India.3 The valuable
and high tech analysis is well structured in order to
assist in unravelling the complex problems encountered
in developing economic growth strategies. It is a visible
evidence of achievement in software and ITeS exports,
there is a serious deficiency of research on how the
different strategies accepted by the subnational regions
influenced the specific development path of the industry
in the corresponding regions. It looks like a strongest
argument for the significance of this article.
IT Industry in Tamil Nadu
Tamil Nadu has the first state in the Indian Union to
formulate a separate IT policy for it. As early in 1997, the
Government of Tamil Nadu released an industry-specific
policy for the IT industry to reach the goals framed out in
the Ninth five year plan and to focus attention on the IT
industry as an engine of growth in the State. However, the
sum of change in the IT industry needs a reform in this plan.
By the year 2002, Tamil Nadu Government released a new
IT policy geared towards leveraging IT to herald prosperity
in the State and to turn Tamil Nadu in to a Knowledge-
empowered State.
The development of the Internet has transformed our life
into a pocket world and it delivers the facilities all over
the world quickly via IT enabled services. As per the 2002
report of NASSCOM, IT and IT enabled services industry will
accelerate 7% of Indias GDP and 30% of foreign exchange
within a short period. This revolution will provide direct
and indirect employment opportunities over four million
job seekers in knowledge sector (Elcot Manual). Tamil
Nadu having the high talented young generations to rule
the Indian IT and ITeS industry when compared to others.
The effective administration and educated workforce may
lead Tamil Nadu to the top in IT sector in the next decade.
ELCOT
Electronics Corporation of Tamil Nadu Limited (ELCOT)
was registered under the Indian Companies Act, 1956 as a
Company with the Registrar of Companies, Tamil Nadu on
the 21st day of March 1977. It was registered as a Company
with the entire shareholding being held by the Government
of Tamil Nadu. ELCOT have been continuing its services
as a fully owned by Tamil Nadu Government. ELCOT was
established with the main objective to promote, establish
and run a State Public Sector Enterprises for Electronic
items; manage, supervise, finance, advise, assist, aid or
collaborate with any association, firm, company, enterprise,
undertaking, institution or scheme for the advancement
and development of all branches of electronics and of
industries and business concerns based on or relating to
electronics (Elcot Proceedings).
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ELCOT started its commercial operations during the year electorate of Tamil Nadu, preparation and distribute of
1980-81 and it has successfully completed thirty six years of Family Cards to the people of Tamil Nadu, execution of
its effective business life. ELCOT has started to make profits computer education to the school students in Government
from the year 1988 and continuing it to be profitable one Schools of Tamil Nadu, implementation of computer
with concrete development over the years. The vision to education to the college students in Government Arts
promote industrial companies in the field of electronics, and Science Colleges, Medical Colleges, Law Colleges,
ELCOT made several Joint Ventures/Associate Ventures/ Polytechnics in Tamil Nadu.
Escort Ventures in the field of electronics with cooperation
and participation. In addition to promotion, ELCOT was Special Economic Zone
also successful in establishing an industrial unit on its own
India was the first nation in Asia to recognize the
name in Hosur for the production of Aluminium Electrolytic
effectiveness of the Export Processing Zone (EPZ) model
Capacitors is mainly used in the manufacture of television
in promoting exports, with Asias first EPZ set up in Kandla
receivers. Apart from this ELCOT servicing to the society
(Gujarat) in 1965. With a view to overcome the shortcomings
by undertaking several public authorities, educational
experienced on account of the multiplicity of controls and
institutions, administrative sector etc.
clearances, absence of world-class infrastructure and an
The major projects which have been completed successfully uneven economic system with a view to attract maximum
by ELCOT for the past twenty five years. The main operations foreign investments in India, the Special Economic Zone
were preparation and issue of Voter ID Cards to the (SEZ) Policy was announced in April 2000.
Table 1.State-wise distribution of approved SEZs
State-wise distribution of approved SEZs (As on 01.05.2017)
Name of the State/ Union Formal In-principle Notified SEZs Exporting SEZs
Territory Approvals Approvals
Andhra Pradesh 30 4 25 20
Chandigarh 2 0 2 2
Chhattisgarh 2 1 1 1
Delhi 2 0 0 0
Goa 7 0 3 0
Gujarat 28 4 24 19
Haryana 23 3 20 7
Jharkhand 1 0 1 0
Karnataka 62 0 48 26
Kerala 29 0 25 19
Madhya Pradesh 10 0 5 2
Maharashtra 55 12 48 28
Manipur 1 0 1 0
Nagaland 2 0 2 0
Odisha 7 0 5 3
Puducherry 1 1 0 0
Punjab 5 0 3 3
Rajasthan 9 1 8 4
Tamil Nadu 49 4 47 36
Telangana 65 0 53 29
Uttar Pradesh 24 1 19 12
West Bengal 7 2 5 7
Total 421 33 345 218
Source: sezindia.nic.in

Tamil Nadu having 49 Special Economic Zones in total
and eight Special Economic Zones reserves for the IT and
ITeS industry. In order to spread the development of IT/
ITeS industry all over Tamil Nadu, ELCOT has established
IT/ITeS Special Economic Zones in metro city Chennai and
Seven ELCOSEZs at Six Tier-II localities such as Coimbatore,
Madurai, Tiruchirappalli, Salem, Tirunelveli and Hosur.
In this segment, Madurai ELCOSEZ seizes two plants in
Ilandhaikulam and Vadapalanji.

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Paramasivan C et al. J. Adv. Res. Entrep. Innov. SMES Mgmt. 2017; 3(3)

Table 2.Tier wise classification of cities

Category Population
Tier-1 1,00,000 and above
Tier-2 50,000 to 99,999
Tier-3 20,000 to 49,999
Tier-4 10,000 to 19,999
Tier-5 5,000 to 9,999
Tier-6 less than 5,000

SEZ-Sholinganallur, Chennai IT/ITeS Company WIPRO has completed 27 acres as its

firm construction and operates with 19,000 employees.
ELCOT SEZ Sholinganallur was established with an area HCL encountered 23 lakh sq. ft office building and started
of 377.08 acres. The investment of ELCOT in this SEZ is its processes with 16,000 staff members. In addition to
around 194 Crores. The plots have been allotted to major that 12 lakh sq. ft IT building construction work is under
IT Companies. In that list WIPRO reserves 80 acres; HCL, progress. Cognizant Technology Solutions have commenced
Mahima Infotech and Sathyam Computers reserves 50 acres with 28 acres with 9,000 employees. Sathyam Computers
each; Cognizant Technology Solutions holds 40 acres and has completed 6.25 lakhs sq. ft building and operates with
Sutherland locates 15 acres in this SEZ. Even after 92.36 6,000 workers. In this SEZ the common infrastructure work
lakh sq. ft were remains unallotted to anyone. The major was completed at an estimated cost of 42 crores.
Table 3.
Sholinganallur, Chennai
Company Name Area Allotted Area Utilized Year of Estb. No. of Employees
Wipro Pvt Ltd 80 acres 27 acres 2012 19,000
HCL 50 acres 35 acres 2012 16,000
Cognizant Technology 40 acres 28 acres 2013 9,000
Mahima Infotech 50 acres 8 acres 2013 5,500
Sathyam Computers 50 acres 6 acres 2012 6,000
Sutherland IT Services 15 acres 5 acres 2013 3,800

SEZ-Vilankurichi, Coimbatore facilities have been constructed at an estimated cost of

ELCOT SEZ Vilankurichi was established with 62 acres of
land in Coimbatore. The investment of ELCOT in this SEZ
is 70 crores. ELCOT assigned area to major IT Companies
such as WIPRO with the capacity of 9.5 acres and TIDEL
Park Coimbatore Ltd also reserves 9.5 acres each. WIPRO
has constructed IT building in 3.5 lakhs sq. ft and 90% of
the construction was finished. TIDEL Park Coimbatore Ltd
has completed their construction work of 17 lakhs sq. ft IT
building. The remaining land available in SEZ Vilankurichi
is 26.19 acres. In this SEZ, the construction of common
infrastructure facilities work has been finished at an
estimated cost of 19 crores.
SEZ-Ilandhaikulam and Vadapalanji, Madurai
In Madurai, 28.91 acres of land in Ilandhaikulam Village
and 245.17 acres of land in Vadapalanji have been framed
to ELCOT for establishing two IT and ITeS Industry by the
Government of Tamil Nadu. In the Ilandhaikulam SEZ, the
investment of ELCOT is 32 crores. An IT cum Administrative
building has been constructed at an estimated cost of 17
crores. In Ilandhaikulam SEZ, the corporate infrastructure
7 crores. Out of the remaining land 4.5 acres of land has
been allotted to Honeywell Technologies Limited and 2.25
acres to Chella Software Pvt. Ltd. The unallotted land in this
Ilandhaikulam is 9 acres. In Vadapalanji SEZ, the preparation
of common infrastructure facilities work was over and the
investment amount crossed 14 crores. The total investment
of ELCOT here is 45 crores. In this plant, 5 acres of land
has been allotted to Caliber Point and 2 acres of land was
shared to Health Plan System India Ltd. The balance allot
able land in this SEZ is 181.15 acres.
SEZ-Navalpattu, Tiruchirappalli
In Tiruchirappalli, Navalpattu Village, ELCOT SEZ was
established with 147.61 acres of land. The whole investment
of ELCOT in this SEZ will be Rs.60 crores. In this SEZ, Assyst
International Pvt. Ltd acquires 3 acres of land; Health Plan
Systems (India) Pvt. Ltd. obtains 2 acres of plot; iWave
Systems Tech. Pvt. Ltd gains 5 acres area; Unlimited
Innovations India Pvt. Ltd holds 5 acres of land; Zylog
Systems Limited secures 5 acres; iLink Multitech Solutions
Pvt. Ltd and WNS Global Services Private Ltd reserves 1
acre and 5 acres respectively. Seventh Sense Technologies

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have been allotted space of 2,000 Sq. ft in this SEZ. The
balance allowable land in this SEZ is 80.73 acres. The
common Infrastructure of this SEZ has been completed
at an expected cost of Rs.14.21 crores.
Present Assignments of ELCOT
LAPTOP Scheme to School Students
Family Card Project
Driving License Project
ERP Software Development
Digital Network Project
Procurement Activity
Computer Training Centre
Farmers Social Security Card Project
Crime and Criminal Tracking Network System
Banking Automation for Cooperative Banks
Computerisation of Welfare Boards
Seamless Communication Network
Tamil Nadu State Wide Area Network
National Knowledge Network
Tamil Nadu State Data Centre
Disaster Recovery Centre
Conclusion
With the intent of the globalization, IT and IT enabled
industries transformed into a vibrant and unavoidable
segment of the socio-economic development of the
country. Tamil Nadu is one of the most benefited states in
the country through LPG reforms. Electronics Corporation
of Tamil Nadu Limited has prepared to attract the widest
possible range of business opportunities and ready to
provide more number of employment opportunities to
the young talents. However, to achieve this goal ELCOT
has to continue its effort on inventing new business ideas
through new business models for the better improvement.
A collaborative work from all the members will lead ELCOT
to the promotional area. The success of ELCOT is based on
availability of skilled workers with specialized infrastructure.
ELCOT welcomes new technopreneurs to come up with
innovative business solution, at the same time ELCOT should
consider the middle grouped investors along with the top
IT companies. If this happens in future, Chennai and the
other Special Economic Zones of Tamil Nadu will reach the
top position in IT and ITeS industry in India.
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