IndiaFilings » Learn » Tamilnadu Information Communication Technology Policy

Tamilnadu Information Communication Technology Policy


Tamilnadu Information Communication Technology Policy

The Department of Information Technology of the Government of Tamilnadu has formulated the Information Communication Technology Policy, 2018 to promote the IT & ITeS sector and to increase software production, exports and employment generation in Tamilnadu. The ICT policy also promotes the growth of the IT & ITeS sector in the Tier-II cities. One of the primary focus is to attract investment in the Computer hardware sector as well. The ICT policy is evolved with following in mind:

  1. Incentivising investment, employment and intellectual capital creation
  2. Integration with initiatives of Vision 2013
  3. Special attention to Start ups, MSMEs and employment of women


The objectives of the policy are:

  • Make Tamil Nadu the number one in the IT sector.
  • To be a destination for foreign investors for their projects in the sector.
  • For incremental direct investment from foreign and across the state.
  • Create employment opportunities at large scale.
  • Encourage youth of the state to the IT/ITeS sector.
  • Enable Tamilnadu to be a cost-effective place for the development of IT/ITeS.
  • Emphasise on the promotion of Green IT and ITeS.
  • Improve the quality of life of the citizens through the IT/ITeS.
  • Encourage entrepreneurs to begin Warehouse Start-ups.
  • To make the usage of Tamil computing easier.
  • The fast development of IT and ITeS in the southern districts.


The following strategies are planned to make Tamilnadu a global hub for investment:

  • Providing training for students at the industry level, so that it paves the way for employment.
  • Support the Research and Development, Innovation and Entrepreneurship in the sector.
  • Increase the IT base scope to animation, Gaming and Digital Entertainment, IT Product and Services in Engineering, Retail, Health Management etc.
  • Support the technology start ups, providing with quality infrastructure.
  • Special incentives to encourage entrepreneurs, SMEs, women and socially challenged people in the sector.

Area of Focus

To improve the sector of IT/ITeS, certain fields will be given more focus.

  • Social, Mobile, Analytics and Cloud (SMAC).
  • E-Commerce portal for the departments of government.
  • E-Learning
  • Massive Open Online Course content (MOOC)
  • Content Creation
  • Digital Management and Technology
  • Business Intelligence Software and Analytics.
  • Data warehousing
  • Electronic System Design and Manufacturing (ESDM) training
  • Tamil Computing
  • Animation and Gaming

Skill Development

 The Government has given focus to the area of skill development. A skill development Mission has been implemented.

  • The students going to vocational streams will be guided about the academic stream.
  • The government will impart employability skills to convey the challenges in the industry.
  • Centre of excellence in technologies and research will be initiated by the government, through the collaboration of industries with colleges.
  • To compete internationally, a skilled workforce will be created with the knowledge of foreign languages.
  • National Knowledge Network (NKN) will be borrowed for the industry-academic purpose. The NKN is a National Level High-Speed Network which connects the academic institutions and also links with the global scientific community.


The Government of Tamilnadu has decided to provide higher incentives to companies that invest in the Tier-II cities such as Coimbatore, Madurai, Trichy, Hosur, Salem, Tirunelveli and other rural locations.


Locations Description – Districts classification
A Chennai, Thiruvallur and Kancheepuram
B Other than A and C (20 districts)
C Madurai, Theni, Dindigul, Sivagangai, Ramanathapuram, Virudhunagar, Tirunelveli, Thoothukudi and Kanyakumari

Standard Fiscal Incentives

  • The new or expansion manufacturing units, located anywhere in the state will be given capital subsidy, and tax exemption for the power purchased from the TANGEDCO (Tamilnadu Generation and Distribution Corporation Ltd.) or consumed or generated from the captive sources will be based on investments in the fixed or eligible assets.
  • For location A and B, the subsidy will be paid at the end of 3 years and in the location at the end of 4 years, only when it satisfies the below table.
  • An additional capital subsidy of over 50% will be given for new or expansion IT/ITeS industries in the A districts.
  • An additional capital subsidy of 10% and 25% will be given to IT/ITeS industries in Districts B and C respectively.
Investment in fixed assets/eligible fixed assets (in crore) Direct employment (in numbers) Capital subsidy (in crore) Electricity tax exemption from the date of commercial operation
5–50 500 0.30 2 years
50–100 500–1000 0.60 3 years
100–200 1000–2000 1.00 4 years
200–500 2000–4000 1.50 5 years

Special Incentives for MSME units

New and expansion MSME units will be given financial assistance on the following conditions:

  • MSME units should reach the level of 50 employees in 3 years
  • Specialised training will be given to employees through Tamilnadu Skill Development Corporation (TNSDC) if MSME units employ a minimum of 100 people.
  • A start up or an MSME will be given a subsidy of 10% on lease rentals for 3 years. The total amount of rental cannot exceed 2 lakhs per annum.
  • The government will facilitate the tie-ups to strengthen the MSMEs
  • The government will link up small IT/ITeS companies to bigger firms

Fiscal Incentives

This incentive is provided for the following:

Criteria Location A Location B Location C
Investment range (in crore) 500 and above 350 and above 200 and above
Employment (Minimum number of employees) 6,000 4,000 2,000
Timeline within which target is to be achieved (years) 3 3 4
  • The companies which make an investment for their use are eligible for the incentive.
  • The investment period will begin from the date of Memorandum of Understanding(MoU) with the government or any date that the government proposes.
  • The expansion of industries that are in the state for over 10 years will be given extra benefits.
  • To receive the fiscal incentive, employment criteria is mandatory.

Special Incentive for Locations B and C

Special incentives will be given for establishing the Sewage Treatment Plant and Reverse Osmosis Plant in the Locations B and C.

Reimbursement of Stamp Duty

Reimbursement of stamp duty and registration fee at the rate of 50% will be provided on the land transaction in location C, for the first transaction of that certain land. No reimbursement will be provided for the next transactions. This will be valid only till 3 years from the date of the transaction.

Other Incentives

  • The MSMEs will be repaid 50% of the cost for the certification, which should be a maximum of Rs.5 lakhs. This incentive can be obtained only once.
  • For the filing of patents, MSMEs will be repaid 50% of statutory fees. The amount for domestic patent should limit to Rs.3 lakh and for the international patent to Rs.5 lakh. This incentive can be obtained 5 times in 5 years.

Other Benefits

  • 100% relaxation of Floor Space Index (FSI) will be sanctioned to all IT/ITeS parks in the state.
  • Ecosystem development and physical infrastructure development will be initiated.
  • IT Innovation and research will be taken care of by setting up research parks and creating funds and awards.
  • Green IT parks will be initiated to provide environment-friendly sector.
  • Annual award for excellence in export will be given.
  • Special Awards will be given to units that provide at least 4% employment to challenged people.
  • The Tamilnadu Industrial Guidance and Export Promotion Bureau will provide Single Window Facilitation. That is to avoid the delays in the procedure for the creation of IT infrastructure.
  • Training will be given to the employees to upgrade their skills.

For more details, Contact:

  • Secretary to Government of Tamil Nadu,
  • Information Technology Department,
  • Secretariat, Chennai 600 009, Tamil Nadu, India.
  • Tel: 91-44-25670783
  • E-mail: [email protected]

For more reference, readers can access the policy in the below link: