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| Last Updated:: 26/12/2024

Industry

 

 

Department: In Kerala,the department of industies and commerce is headed by a Principal Secretary to Government. This department is responsible for promoting/ sponsoring, registering, financing and advising industries in the state. The department and its agencies also guide the entrepreneurs in the selection of appropriate industrial ranges in the private, public, joint and co-operative sectors. Directorates of industries and Commerce, Handloom and Textiles, Coir Development, Mining and Geology and 72 Public Sector undertakings fall under this department. Visit Kerala's position is 12th in the industrial ranking among the major 16 States in India . It was reported that about 22.5 % of the total income of the State came from the secondary sector during 1980-81, which was only 17% during 1970-71. The industrial sector of Kerala employed 15% of the total workers against the national average of 9%.

 

Industrial Growth Centres:As per scheme announced by the Central Government, Government of Kerala has entrusted Kerala State Industrial Development Corporation Ltd (KSIDC) for developing and managing Industrial Growth Centres in various locations in the state. Accordingly KSIDC has acquired /purchased land at four industrially backward locations in the following districts:

 1.Kannur  - Valiyavelicham (Kuthupramba)

2.Kozhikode - Kinalur (Balusserry)

3.Malappuram - Panakkad (Malappuram)

4.Alappuzha - Pallippuram (Cherthala)


 

             The Industrial Growth Centres at the above locations are under various stages of development and basic infrastructural facilities such as road, water, power, telecommunication etc are already put in place. Steps are being taken to improve the facilities further.Industrial plots are available at these Growth Centres and entrepreneurs can get the same for setting up industrial units, on long lease for a period of ninety years. The units coming up in the IGC are supported by Single Window Clearance Mechanism of State Govt.

 

Major Industrial Locations: Most of the industrial and commercial establishments in Kerala are concentrated in the coastal zone.Among the coastal districts, Ernakulam and Trivandrum have fairly large number of industries along the coast, followed by Alappuzha, Kollam, Kozhikode , Kannur, Kasargod and Malapuram. Eloor- Edayar- Ambalamugal area is the major industrial area located in the coastal zone in the city of Kochi in Ernakulam District along the banks of the Cochin backwaters.

 

Major Industries such as

  • Fertilizer and Chemicals Travancore Ltd.(FACT)
  • Kochi Refineries Ltd.(KRL)
  • Hindustan Organic Chemicals (HOC)
  •  Cominco Binani and Cochin Shipyard are located in Kochi availing the advantage of the port facilities.

          The world famous Chavara placer deposits of the Kollam district support three major mineral industries in Kerala viz.

  • The Indian Rare Earths Ltd. (IRE) 
  • Kerala Minerals and Metals Ltd.(KMML) at Chavara (Kollam)
  • The Travancore Titanium Products (TTP) at Veli (Trivandrum).

 

            These units are situated closer to the sea. The Excel Glass factory situated near Cherthala utilizes the silica sands of the coastal zone of Alappuzha district for the manufacture of glass. Most of the seafood and coir industries in Kerala are located in the coastal area and are concentrated in Alappuzha district. There are 101 seafood factories in the coastal zone with a freezing capacity of approximately 1868 t /day, of which 47 are approved by the European Union. Besides, there are 210 peeling sheds and 217 ice plants. Cashew processing industries, a traditional enterprise in the state are mainly situated in the coastal area of Kollam district.There are about 300 large and medium scale industries and 1,66,000 small scale industries, most of them are located in the coastal area (KSPCB, 20002). Of these 250 large and medium scale industries and 5000 small scale industries are polluting significantly to the environment.   

 

District-wise break up of Medium and Large Scale Industries in Kerala as on 31-03-2007

 

Map of Kerala showing important Fishing Harbors & Ports 

 

Industrial sector in Kerala

 

                        Industrial sector in Kerala comprises medium and large industries, micro, small and medium enterprises (MSME) and traditional industries. The departments/agencies that deal with medium and large industries are Kerala State Industrial Development Corporation Ltd (KSIDC), Kerala Industrial Infrastructure Development Corporation (KINFRA), Public Sector Restructuring and Internal Audit Board (RIAB), Bureau of Public Enterprises (BPE) and Centre for Management Development (CMD). The agencies dealing with MSME and traditional industries are Department of Industries and Commerce, Directorate of Hand loom and Textiles, Directorate of Coir Development, Khadi and Village Industries Board and Capex. Department of Mining and Geology also comes under this sector.

 

 

 Micro Small and Medium Enterprises (MSMEs)

 

                     Micro, Small and Medium Enterprises (MSME) play a significant role in the economic development of a country. MSMEs are strong drivers of employment generation and economic development in India. The Government of Kerala assigns priority to the sector realising its potential to generate employment, and thereby contribute to economic growth. In addition, the sector can add to export growth. The sector plays a critical role in promoting innovation and ensuring sustainable development, equitable growth, and the utilisation of natural resources.

 

                    The 73rd round of NSS reported 633.88 lakh unincorporated non-agricultural MSMEs engaged in different activities in India, of which, 31 per cent MSMEs were engaged in manufacturing activities, 32 per cent in trade and 33 per cent in other services (196.65 lakh in manufacturing, 230.35 lakh in trade, 206.85 lakh in other services and 0.03 lakh in non-captive electricity generation and transmission) Excluding those registered under “(a) Sections 2m(i) and 2m(ii) of the Factories Act, 1948, (b) Companies Act, 1956 and (c) Construction activities falling under Section F of National Industrial Classification (NIC) 2008.” MSMEs shares about 45 per cent of India’s manufacturing output and contribute more than 40 per cent to country’s exports. About 28 per cent of the GDP is generated by this sector. MSMES provide employment to about 11.1 crore people (3.60 crore in manufacturing, 3.87 crore in trade and 3.62 crore in other services and 0.0007 crore in non-captive electricity generation and transmission) in the rural and urban areas across the country. Out of the 633.88 lakh MSMEs, 324.88 lakh (51 per cent) were in rural areas and 309 lakh MSMEs (49 per cent) were in urban areas. 

 

                  As on 31st December 2022, a total number of 1,30,93,698 enterprises were registered in Udyam Registration online portal as classified, consisting of 36,66,235 enterprises registered under Manufacturing category and 94,27,463 enterprises registered under Service sector (Government of India, 2023).2 This is the second largest employing sector after Agriculture. The sector is diverse in terms of size, levels of technology employed, and products. Existing classification of MSME units based on investment in plant/machinery/equipment and annual turnover is given below:

 

 Classification of MSMEs       

Composite Criteria: Investment in plant/machinery/equipment and Annual Turnover

Classification

Micro

Small

Medium

Manufacturing Enterprises and enterprises rendering Services

Investment < ₹1 crore

Investment < ₹10 crore

Investment < ₹50 crore

Turn over < ₹5 crore

Turn over < ₹50 crore

Turn over < ₹250 crore

Source: Ministry of MSME, Government of India

 

MSME sector in Kerala                    

 

                    The Micro, Small and Medium Enterprises (MSME) sector is emerging as a major income generating and employment providing sector in Kerala. At the same time, the level of investment is relatively lower in the sector. As per the MSME Survey and Quick Results of 4th Census, 5.62 cent of MSME enterprises in India are in Kerala. The MSME sector helps in industrialisation of rural and backward areas, and provides employment to youth and socially disadvantaged groups such as SC, ST, women and persons with physical disabilities.

 

                   Within the MSME sector there is a significant increase of micro enterprises, both in terms of working enterprises and employment. The industries coming under this sector are handicrafts, handloom, khadi, food processing industries, garment making and textile industries and industries related to coir/wood/bamboo/Plastic/rubber/leather/clay products. MSMEs produce over 8,000 various MSME products ranging from traditional to high-tech items are manufactured by MSMEs.

 

                  MSMEs are facilitated and supported in the State by the Government and banks. The District Industries Centres (DIC) act as a facilitator for the growth of the MSME and traditional industrial sectors in Kerala. DIC implements various schemes to develop entrepreneurial culture in the State. Industries Department provides financial assistance to start Entrepreneurship Development clubs at school and college level to develop entrepreneurial culture among the youth and to organise entrepreneurship development programmes for them. In addition, the Department has made it a priority to provide services to Start-ups and to set up business incubation centres in District Industries Centres. 

 

                  The economic growth of Kerala is related to the development of MSMEs. Directorate of Industries and Commerce (DIC) is implementing various schemes to increase production and employment in this sector. The agencies under the Directorate are the Directorate of Handloom & Textiles, which aims at evolving policies for the promotion and development of handloom and textile sector in the State; Directorate of Coir Development, the implementing agency for all policy decisions of the Government of Kerala related to coir industry; Khadi & Village Industries Board, vested with the responsibility of organising and promoting Khadi and Village Industries in the State, and the Directorate of Plantation, set up in 2022-23 for the development of the plantation sector in the State.

 

Plan Outlay and Expenditure of Directorate of Industries and Commerce, 2021-22 to 2023-24*, ₹ in lakh  

Sector

2021-22

2022-23

2023-24

Outlay

Exp

Outlay

Exp

Outlay

Exp*

Small Scale Industries

13894.00

13680.47

20040.00

12956.57

 

21270.00

6900.04

Commerce

1200.00

1193.00

700.00

 

653.42

 

700.00

16.00

Handicrafts

385.00

321.53

350.00

 

226.18

 

420.00

56.60

Total

15,479.00

15,195.00

21090.00

 

13,836.17

 

22,390.00

6,973.44

* as on 08.10.2023
Source: Plan space Kerala

  

Udyog Aadhar Memorandum (UAM) in the State

 
 

                  Kerala has discontinued the practice of filing Entrepreneurs Memorandum Part II from September 18, 2015, and in its place, started online registration in Udyog Aadhar. As on March 31, 2023, there were, 3,72,227 UAMs filed which include 1,08,913 manufacturing units and 2,63,314 units in the Service Sector. Manufacturing units comprised of 1,04,133 micro units, 4,330 small units and 450 medium units. Out of 2,63,314 UAMs in the service sector, 2,54,256 are micro, 8,531 small and 527 medium units3. The districtwise number of Micro, Small and Medium units registered under manufacturing and service sectors in 2022-23 is given below:  

 

MSME Units with Udyog Aadhar Number as 31.03.2023

 

 

Name of District

Manufacturing

Services

 

Micro

 

Small

 

Medium

 

Total

 

Micro

 

Small

 

Medium

 

Total

 

Grant Total

Thiruvananthapuram

12111

238

23

12372

33336

875

57

34268

46640

Kollam

7020

331

26

7377

17361

640

19

18020

25397

Pathanamthitta

3069

65

7

3141

9079

277

12

9368

12509

Alappuzha

6399

229

17

6645

15034

406

12

15452

22097

Kottayam

5608

270

34

5912

14365

596

36

14997

20909

Idukki

2987

106

9

3102

8002

262

11

8275

11377

Ernakulam

16436

1320

139

17895

36760

1968

173

38901

56796

Thrissur

12109

488

68

12665

23710

819

54

24583

37248

Palakkad

8726

338

39

9103

20198

487

29

20714

29817

Malappuram

8224

318

14

8556

18621

623

29

19273

27829

Kozhikode

9281

262

37

9580

23564

709

54

24327

33907

Wayanad

2362

79

6

2447

6522

155

5

6682

9129

Kannur

6100

191

20

6311

19288

496

31

19815

26126

Kasaragod

3701

95

11

3807

8416

218

5

8639

12446

Total

104133

4330

450

108913

254256

8531

527

263314

372227

Source: Directorate of Industries & Commerce

 

 

                 Number of Micro, Small and Medium units registered under Manufacturing and Service Sectors in Kerala, 2022-23

 

 

Performance of the Sector 

 

                  The State achieved remarkable surge in the number of new MSME units established in 2022-23. A total of 1,39,840 new MSME units were set up in 2022-23 with investment of Rs 8,421.63 crore, registering an increase of about 449 per cent over previous year. These units have created employment opportunities for 3,00,051 individuals, registering about 244 per cent increase over previous year. Such a massive expansion in the MSME sector is an encouraging sign for the State’s economy and a testament to its potential for growth and development. The details of new MSME units for the last five years are given below:

 

Achievement in MSME sector, 2017-18 to 2022-23 (As on August 31, 2023)

Year

No. of MSME Units

Investment

(Rs in crore)

Employment

(in number)

2017-18

15,468

1,249.61

51,244

2018-19

13,826

1,321.94

49,068

2019-20

13,695

1,338.65

46,081

2020-21

11,540

1,221.86

44,975

2021-22

15,285

1,535.09

56,233

2022-23

1,39,840

8,421.63

3,00,051

Total

2,09,654

15,089.62

5,47,652

Source: Directorate of Industries and Commerce

 

The number of new MSME units and employment provided for the last two years is shown below:

 

  

                  In 2022-23, the district with the largest numbers of new MSME units was Thiruvananthapuram (14,434 units) with an investment of Rs 840.89 crore, generating 29,878 employment opportunities, followed by Ernakulam (14,128 units) with an investment of Rs 1,172.46 crore generating 33,765 employment opportunities and Thrissur (14,123 units) with an investment of Rs 752.42 crore providing employment to 29,536 persons. Wayanad (3,950 units) had the lowest number with an investment of 236.58 crore generating employment for 8,234 persons. The district-wise details of new MSME units started in Kerala in 2022-23 is given below:

 

District wise details of new MSME units started in Kerala in 2022-23

Sl. No

State \ District

No of MSME units started

Total Investment (Rs in crore)

Employment generated (Nos)

1

Thiruvananthapuram

14434

840.89

29878

2

Kollam

11985

622.58

24449

3

Pathanamthitta

5532

257.53

11478

4

Alappuzha

9953

527.58

21213

5

Kottayam

7958

438.24

16603

6

Idukki

4112

232.46

8519

7

Ernakulam

14128

1172.46

33765

8

Thrissur

14123

752.42

29536

9

Palakkad

12557

674.56

27729

10

Malappuram

12428

812.07

28818

11

Kozhikode

12224

856.93

26495

12

Wayanad

3950

236.58

8234

13

Kannur

11702

698.47

23905

14

Kasaragod

4754

298.86

9429

Total

139840

8421.63

300051

Source: Directorate of Industries & Commerce

  

                  In 2021-22, Thrissur was the district with the largest number of new units (1,789 units) generating 5,200 jobs, followed by Kozhikode with 1,455 units generating 4,738 jobs and Palakkad with 1,413 MSME units with 5,850 jobs. Kasaragod (220 units) had the lowest number with an investment of 17.09 crore generating employment for 959 persons. District-wise details of new MSME units in the State in 2021-22 and 2022-23 is given below:

 

 

                    The sector-wise growth of MSME units over the last five years reveals an increase in the number of agro and food-based units from 2,712 in 2018-19 to 23,474 in 2022-23. The number of service related MSME units has increased from 3,259 in 2018-19 to 26,159 in 2022-23. The subsector -wise details of MSME units started in the last five years is given below:

 

Sub-sector-wise details of new MSME units started in Kerala   

Name of Subsector

2018-19

2019-20

2020-21

2021-22

2022-23

Agro and Food-based

2712

2,582

3359

4297

23,474

Textiles and Garments

1858

1,904

1276

1564

14,702

General/mechanical/light Engineering

1533

1,334

959

1193

1,988

Service Activities

3259

4,036

2725

4097

26,159

Wood Products

644

5,32

436

517

1,529

Cement Products

329

3,09

233

368

0

Printing and Allied

348

2,80

188

198

3,795

Paper Products

192

1,88

198

234

659

Information Technology

294

2,40

187

348

6,091

Trade activity

-

-

-

-

48,945

Others

2657

2,290

1949

2469

12,498

Total

13,826

13,695

11,540

15,285

1,39,840

Source: Directorate of Industries and commerce

* From 2022-23 onwards the data of trade activity included

 

                         The top five subsectors together consist of over 80 per cent of the MSME units in the last five years. Trade Activity based units (35%), Agro and food based (17%) units and Service Activities (19%) dominate in MSMEs. Units making plastic containers, gold ornaments, rubber products, handicrafts products are classified as “Others” (9%). Textiles and garments (10%), Information Technology (4%) and General/Mechanical/Light Engineering (1%) are the other leading subsectors. The share of each subsector is given below:

 

Subsector wise details of new MSME units in 2022-23

 

 

 

Export

 

Cashew:  

 

                  India is among the largest cashew producing countries in the world. It employs large number of workers in the farms and factories. India exports cashews to more than 60 countries. As per the Directorate General of Commercial Intelligence and Statistics, the quantity of cashew export for India in 2022-23 is 76,824.69 MT and value is Rs 2,98,219.37 lakh. This was 80,366.25 MT and Rs 3,40,991.42 lakh in the previous year. This is (-) 5.59 per cent fall in quantity export and (-) 12.54 per cent fall in value exported.

 

                  Cashew cultivation spreads along the coastal regions of peninsular India. Kerala is an important player in cashew production, processing and export. Cashew processing industry was earlier concentrated in Kollam, but now it spread across many States in India. The export of cashew kernels from Kerala was 21,858 MT in 2022-23. It registers a negative growth of (-) 10.05 per cent in volume from 24,299 MT in 2021-22.

 

  Export of cashew kernels, Kerala and India, 2015-16 to 2022-23, in Rs crore                                    

Year

Kerala

India

Share of Kerala (%)

Quantity

(MT)

Value

(Rs crore)

Quantity

(MT)

Value

(Rs crore)

Quantity

Value

1

2

3

4

5

6

7

2015-16

50,652

2,579.5

96,346

4,952.1

52.6

52.1

2016-17

38,054

2,415.3

82,302

5,168.8

46.2

46.7

2017-18

36,930

2,580.4

84,352

5,871.0

43.8

44.0

2018-19

29,062

1,892.6

66,693

4,434.0

43.6

42.7

2019-20

30,478

1,742.5

67,647

3,867.2

45.1

45.1

2020-21

*23,368

NA

49992

2907

46.7

NA

2021-22

*24,299

NA

53770

3175.2

45.2

NA

2022-23

*21,858

NA

       

Source: Cashew Export Promotion Council of India /*Cochin Port Trust

 

 

                  The export of cashew nuts kernel whole and dried nuts contribute 58,593.52 MT of export volume and Rs 2,82,030.19 lakh value in 2022-23. This was 73,560.50 MT in 2021-22 with value of Rs 3,29,902.10 lakh. The export of cashew nut shell liquid from India shows an increasing trend in 2021-22, although the growth in export of other items are not promising. There is no export of nut shell liquid from Kerala since 2020-21.

 

Export of Coir and Coir Products

  

                  The export of coir and coir products from India is 12,64,784 MT in volume and Rs 3,992.17 crore in value. This is a 2.85 per cent growth over the previous year’s export of 12,34,855 MT of coir and coir products. The export of coir and coir products from Kerala through Cochin Port showed a declining trend in 2022-23. The quantity exported through Cochin Port in 2022-23 was 1,19,350 MT and recorded a negative growth of 50.42 per cent over the previous year. The export of coir and coir products through Cochin Port in 2021-22 was 2,40,745 MT. Export trend of coir and coir products from India and Kerala is given below:

 

Export trend of coir and coir products from India and Kerala (through Cochin Port), 

2016-17 to 2022-23, quantity in lakh MT

 

  

Export of Tea:

 

                  Export of tea from Kerala ports in 2022-23 is 68.88 MT worth Rs 1,511.11 crore from 66.86 MT worth Rs 1,515.16 crore in 2020- 21 registering a growth of 3.02 per cent in terms of quantity and (-) 0.27per cent in terms of value. The details are given below:  

 

Export of tea from Kerala ports and India, 2018-22, quantity in MT, Rs In Crores 

Year

India

Kerala

Qty

Value

Qty

Value

2018

256.06

5,335.33

81.72

1,386.14

2019

252.15

5,737.66

79.74

1,530.28

2020

209.72

5,235.29

70.96

1,515.30

2021

196.54

5,311.15

66.86

1,515.16

2022*

226.98

6,253.19

68.88

1,511.11

Source: Tea Board * Provisional; subject to revision

 

Export of Coffee:

 

                  The export of coffee from Kerala through Cochin port in 2022-23 was 53291MT and Rs 1.16 lakh in value. This shows a fall in quantity exported by (-) 29.54 per cent and fall in value by (-)10.81 per cent, in 2022-23 compared to the previous year.

 

Export of Spices:

 

                  In 2022-23, the export of spices and spice products from India was 14,04,357 MT valued Rs 31,761.38 crore as compared to 15,30,661 MT valued Rs 30,324.32 crore. This registers a decline of 8.25 per cent in volume and an increase in value by 4.74 per cent. The export of spices from Kerala in 2022-23 was 1,11,080.13 MT and value of export was Rs 5,51,521.02 lakh. This shows a decrease in quantity traded by 10.09 per cent and value by 2.67 per cent over the previous year.

 

 Export of spices, India and Kerala, from 2016-17 to 2022-23, quantity in MT and value in ₹ lakh

 

Year

Kerala

India

Kerala’s share (%)

Quantity

(in MT)

Value

(Rs lakh)

Quantity

(in MT)

Value

(Rs lakh)

Quantity

Value

1

2

3

4

5

6

7

2016-17

84,418.8

4,27,120.1

9,47,790

17,81,223.6

8.9

24.0

2017-18

95,455.9

4,15,296.1

10,28,060

17,98,016.2

9.3

23.1

2018-19

89,590.8

3,78,560.4

11,00,250

19,50,581.1

8.1

19.4

2019-20

1,00,195.8

4,05,421.3

12,08,400

22,06,280.0

8.3

18.4

2020-21

1,21,348.9

5,00,633.6

17,58,266

30,96,771

6.9

16.2

2021-22

1,23,547.93

5,66,643.6

15,30,661

30,32,432.4

8.1

18.5

2022-23*

1,11,080.13

5,51,521.02

14,04,357

31,76,138.2

7.9

17.36

Source: Spices Board *Provisional

  

              Kerala’s export of spices and spice products, in quantitative terms, showed an increasing trend in 2019-20 and 2020-21. It continued positive in 2021-22, although declined the growth rate from the previous year. The year 2022-23 registered a negative growth of (-) 10.1 for Kerala. Indian trend for spices export continued to be negative for two consecutive years and remained (-) 8.3. Figure 5.4.7 depicts the trend in growth of export of spices and spice products from India and Kerala.

 

Trend in growth of export of spices and spice products from India and Kerala, 2017-18 to 2022-23, quantity in per cent

 

 

 

                     In 2022-23, the export of individual spices like chilli, cardamom (small), ginger, cumin, celery, fenugreek from Kerala showed decrease both in volume as compared to previous year. A total volume of 1,345 MT of cardamom (small) valued Rs 500.02 crore was exported from Kerala in 2022-23 as against 5,825 MT valued Rs 800.05 crore in 2021-22. Export of chilli 25,717 MT valued Rs 659.70 crore in 2022-23 shows a decrease from 30,225 MT valued Rs 650.97 crore from the previous year. The export of pepper was declined to 12,491 MT valued Rs 572.21 crore in 2022-23 as against 17,248 MT valued Rs 602.98 crore in 2021-22.

 

               In the case of value-added products export of curry powder and mixture showed an increase in volume and value while spice oil and oleoresins products showed marginal decline in 2022-23 in terms of quantity as compared to 2021-22. Export of curry powder and mixture in 2021-22 was 15,284 MT valued Rs 314.79 crore and which rose to 17,505 MT valued Rs 408.60 crore in 2022-23 recording an increase in volume and value of export. Spice oils and oleoresins valued Rs 2,444.56 crore was exported in 2021-22 which declined to Rs 2,365.42 crore in value.