January 18, 2020
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A Southern Economic Bloc?

A Southern Economic Bloc?

A common market for the South is what the Southern Region of the Confederation of Indian Industry (CII) is working towards, through PAKKT which comprises Pondicherry, Andhra Pradesh, Karnataka, Kerala and Tamil Nadu. This is viewed as an unprecedented opportunity to lead the nation's accelerated economic growth.

The southern states are home to 23 per cent of India's population, are physically contiguous and have their own sea-face. All the states are classified among the 'middle states' with an average per capita income of Rs 4,722 and there are no glaring disparities in their economic development. The region, which has over 35 per cent of India's professionals, offers an enormous pool of knowledge-based workers—engineers, chartered accountants, MBAs and software professionals. "While scarce resources can be procured and developed, an inherent advantage in human capital cannot be easily replicated. It is the unique competitive strength of the region," says the CII manifesto for PAKKT.

Urbanisation in the South is as high as 42 per cent compared to the national average of 24 per cent; the relative index of infrastructure developed by the CMIE shows the region has an index of 120 compared to the national average of 100. It has 31.5 per cent of road kms, 23.6 per cent of rail kms, 30 per cent of newspaper and periodical circulation and 41 per cent of port traffic.

Furthermore, a recent NCAER/Citibank study shows that 40 per cent of NRI deposits today are from the southern states. These NRIs, apart from being sources of investment, offer two further avenues to help the region's industrial development—by providing consultancy towards becoming global players and by providing access to companies which could be potential investors in the region.

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