The Tamil Nadu government's efforts in pushing the state as the most preferred IT investment destination in India over the last two-and-a-half years have started showing results.

State government officials said starting with Rs 3,116 crore (Rs 31.16 billion) in 2001 and a market share of 11 per cent in the country, it had grown to Rs 7,000 crore (Rs 70 billion) in 2003 with a total market share of 17 per cent.

On the status of the infotech industry, Vivek Harinarain, IT secretary told Business Standard Tamil Nadu today was the second largest exporter of software in the country.

The total number of software companies was over 1,000 employing above 50,000 professionals, officials said.

The growth in Tamil Nadu is amongst the highest recorded by any infotech software exporting state in recent years. "In the last two years 250 IT/ITES companies have established their base in Chennai translating to one new IT/ITES company has been added every three days," Harinarain said.

The special strengths of the state were connectivity, he added. "Chennai has a seaport which the other leading IT cities in Karnataka and Andhra Pradesh do not have. Moreover the submarine optic fibre cable lands in Chennai. The India to International (i2i ) optic fibre cable provides 8.4 tbps broadband connectivity which no other city can boast of," he said.

On the human resource development side, he said there were 250 engineering colleges in the state. "This is the highest in any southern state, thus ensuring the best provisioning of human resources required for the IT sector," he said. The rate of attrition in Chennai is the lowest as compared to other leading southern IT cities. It is less than 15 per cent as compared to over 40 per cent elsewhere.

Elaborating on the state's strength, he said, "The accounting back-office of the World Bank is in Chennai as also the operational headquarters of SETS (Society for Electronics Transaction and Security)."

On the e-governance front, the state has been a forerunner in initiating a statewide area network, dubbed as TNSWAN. The networking project proposes to connect all district level headquarters up to taluk level at cost of Rs 60 crore (Rs 600 million) over the next 10 years.

Starting its IT initiatives in Chennai, the government over the last one year has been promoting Coimbatore as a major Tier-II city for IT investment. he said, "Every state in the country must strive to develop Tier-II cities and town if they wish to provide a comprehensive IT investment destination for investors. If an investor who has a set up Chennai wants to expand, like for example put up a business continuity or BPO centre, we must be able to offer a destination within the state itself. We are offering Coimbatore as a lead Tier-II city for IT investment."