EV Factory, Transshipment Hub, Spaceport: Tamil Nadu's Thoothukudi Is Finally Recovering From The Disastrous Sterlite Episode

Thoothukudi, a district in southern Tamil Nadu, shot to the limelight a few years back due to protests against the Sterlite plant. The closure of the plant led to India becoming a net importer of copper, and also hurt the local economy in this part of the state.

However, the district now appears to be turning a corner — multiple big-ticket projects have been inaugurated in the span of a few days.

The ground-breaking ceremony for the factory of the Vietnamese electric vehicle manufacturer VinFast was held on 25 February. VinFast is investing $500 million in the first five years and it is expected to create 3,500 jobs.

Once the plant is set up, ancillary units making components for electric vehicles are also expected to come up in the area.

Recognising this, Industries minister T R B Rajaa said that Thoothukudi could become the third automobile hub of Tamil Nadu, after Chennai and Hosur.

On 28 February, Prime Minister Narendra Modi laid the foundation stone for the Outer Harbour Container Terminal project, that would make the VO Chidambaranar port in Thoothukudi as the first transshipment hub on the eastern coast of the country. 

Transshipment hubs are where the transfer of cargo to and from larger vessels (liners) is done by smaller vessels.

Currently, a lot of cargo destined for India or going out of the country is handled at Colombo because it is the nearest transshipment hub.

While India has been making efforts to get a chunk of the transshipment to be done from its shores and two transshipment hubs — Vizhinjam and Vallarpadam are currently under development — both of them are on the western coast.

The project, envisaged to take advantage of Thoothukudi's location — 129 nautical miles away from international shipping lines connecting the far east and the west, could prove to be an alternative to Colombo and Singapore (the other major transshipment hub) or complement them.

Thoothukudi is also set to be a green hydrogen hub. Union Minister for Ports, Shipping and Waterways Sarbananda Sonowal said that 500 acres of land has been identified and NTPC would be setting up a production facility.

In 2023, T K Ramachandran, the Secretary in the ministry said that Thoothukudi was expected to attract investments of Rs 50,000-Rs 80,000 crore related to green hydrogen.

Further, the district is also going to host the country’s second spaceport at Kulasekarapattinam, which is going to make it become a hub for companies in the aerospace industry.

The spaceport is expected to be ready in the next two years and cater to the launching of small satellites. The Tamil Nadu government will be setting up a Space Industrial and Propellants park near the site.

Even on the issue of the Sterlite copper plant, the situation is changing and the Supreme Court has suggested that ways should be found to reopen the plant, while taking steps to mitigate pollution.

The developments in Thoothukudi would also reduce the regional disparity in economic development. Southern Tamil Nadu has been lagging behind the northern and western parts of the state and these projects could hold the key to bridging the gap.