In Sept 2023, American optical laser maker Coherent Corp signed a tripartite Memorandum of Understanding (MoU) with Guidance Tamil Nadu and IIT Madras Research Park (IITMRP) to establish a global centre of excellence (CoE) for R&D on EV batteries and semiconductor devices. In Feb 2024, Walmart Global Tech announced a partnership with IIT-M to establish the Walmart Center for Tech Excellence. Its focus: helping MSMEs in manufacturing and retail sectors adopt AI and digital solutions. Earlier this month, Sweden’s Epiroc launched an ‘innovation outpost’ at IITMRP to drive sustainable solutions for battery energy storage and electrification in minwing and construction. Like Coherent and Walmart, Epiroc too has signed an MoU with Guidance TN and IITMRP.
TN’s top universities have excellent industry credentials and, in a brand-new strategy, the govt is leveraging them to attract high-end R&D-related investments from companies that have previously had no presence either in the state or in India. “IIT-M has had collaboration with industry for decades, but our point from an investment promotions strategy was how do we use this edge,” says Guidance Tamil Nadu CEO Vishnu Venugopalan. These test centres, he adds, “offer familiarity” with the TN ecosystem. MNCs “need an initial understanding of the climate to develop a comfort level about the business ecosystem and the talent pool before they take a decision to establish large scale manufacturing or R&D investments,” says Venugopalan. Typically, companies entering TN for the first time would not want to invest heavily from year one.
Take Epiroc which has had a presence in Maharashtra (Pune) but not in TN. The test centre allows Epiroc to test the waters before committing bigger capex. “When they decide on investments, having an R&D centre in TN becomes a first mover advantage, which makes it easier for the company to take a decision in favour of TN,” adds Venugopalan. In that sense it’s a “nudge” which can, and often is, critical. “With these big companies, we’re competing with many international investment destinations and they need data to convince their board that TN is the best option.”
The strategy ties in with investors Team TN has been focusing on – those present elsewhere in India but not in TN, companies that are present in TN and looking to expand and companies that are not present in India but looking at a China +1 alternative. The test centre option is just one of many parallel conversations that Team TN has with a potential investor before the company agrees to come on board. Sometimes, the team establishes contact during road shows. At other times, it’s part of an ongoing conversation. Take Epiroc. A high-level delegation from TN led by Guidance met the Epiroc leadership team in April 2023 in Sweden. Subsequently, Guidance connected the company to IITMRP and also facilitated Epiroc’s visit to Hitachi Energy Technology Centre and Ola factory & R&D centre.
This ties into TN’s overall R&D focus and its aspiration to move up the manufacturing value chain. “TN has adopted a targeted and strategic approach to attract R&D and high-end investments across sectors,” says industries minister T R B Rajaa. “We are engaging with investors worldwide with high-profile international visits and targeted pitches for high-value sectors such as EVs, life sciences, semiconductors, and aerospace,” he adds.
Setting up specialised clusters such as the Knowledge City in Uthukottai, for example, is important. As is the state’s R&D policy and various sector-specific policies for electronics and space tech. These policies “include incentives and frameworks to attract high-value R&D projects”, says Rajaa. The R&D focus led to the setting up of WorkLabs in Guidance in Jan 2022 to promote, facilitate, and expand industry-academia collaboration in new-age sectors to future-proof the workforce of the state by forging strategic alliances among industry, academia, and govt.
Academia feels a strategy leveraging TN’s academic institutions will encourage localisation and innovation. “In tripartite MoUs IIT-M’s role is to make innovation more relevant for TN,” says Dr Thillai Rajan A, prof, IIT-M.
