Infrastructure plays a vital role in the industrial development. Erode District is having a good infrastructural base in financial institutions, transport, communication, technical manpower etc.


Sound banking net work available is one of the factors, which has constituted to the present industrial activity in this district. Bank branches have spread throughout the district. Even remote and backward places have also been provided with banking facilities.

Canara Bank functions as the Lead Bank in this district. There are 204 Commercial Bank branches besides 32 branches of Erode Central Coop bank, 12 branches of TNPARD Bank and 10 branches of Urban Cooperative bank, as on March 1999. There are 228 Primary Agriculture Cooperative Societies also functioning under Erode Central Cooperative Bank Number of bank branches per lakh population is 8.02 which is higher than the state average of 7.82 Nos. The numbers of Commercial bank branches in the district have increased from 193 as on March 95 to 204 as on March 1999. There are 3 specialised branches are functioning to cater the need of Small Scale Industries. Nearly 80% of the banks are located in rural and semi urban areas.

Deposit mobilisation has registered a growth of 17.59% and 20.54% during the years 1998-99 and 1999-2000 respectively, where as advances registered a growth 0f 3.39% and 13.14% in the same period. The Credit Deposit ratio (CD) registers a declining trend since 1997 where it was 90%, during March 1998 it was 80% and declined to 75% as on March 1999. Now the CD ratio stood at 70% as on March 2000. Though the CD ratio is well above the RBI norms at 60% it is much below the State average. The Annual Credit Plan for the year 2000-01, envisages an allocation of Rs.832.49 crores, out of this 316.29 crores has been allocated for the Small Scale Sector.

Banking Sector - a few indicators (as on March 2000) in
Erode District
No. of Bank Branches258
Aggregate Deposits (Rs in Lakhs)217893
Aggregate Advances (Rs in Lakhs)152310
Credit Deposit Ratio70%
Deposit per branch (Rs in Lakhs)845
Advances per branch (Rs in Lakhs)590
% of SSI Advances to Total Advances26.4%
% of Priority sector Advances to Total Advances68.5%
% of SSI Advances to Priority Advances 38.5%

Credit Flow to SSI Sector

The advance to Small Scale Sector is increasing every year. It was Rs.93.74 Crores during the year 1994-95 and Rs.303.29 Crores during 1999-2000, which shows an increase of 224%. Also the banks are achieving the target allotted to SSI Sector every year except during 1997-98. During the year 1999-2000 a sum of Rs 303.29 Crores has been advanced to SSI sector, accounting 26.4% of the total advances.

Credit flow to SSI Sector over the years

Year Target
(Rs in Lakhs)
(Rs in Lakhs)
% of
over the target
% of increase
in advance
1994-95 61.57
93.74 Crores 152% 
1995-96 101.70 Crores 138.75 Crores 136.4% 48%
1996-97 150.10 Crores160.34 Crores 106.8% 16.6%
1997-98 231.95 Crores 214.27 Crores 92.38% 33.6%
1998-99 260.74 Crores 262.00 Crores 100.4% 22.3%
1999-2000 302.14 Crores 303.29 Crores 100.3%15.8%

Nearly 38.5% of the priority sector lending has been allocated to the SSI Sector in 1999-2000 as against the minimum of 20% recommended by the Nayak Committee. The recovery performance of the SSI Sector is shown below.

Recovery Performance - SSI Sector

Month &
(Rs in Lacks)
(Rs in Lakhs)
(Rs in Lakhs)
% of
in SSI Sector
% of
an overall
Priority Sector
June 1997 5354 35171837 65.69% 74.59%
June 1998 6246 4180 2066 66.92% 79.43%
June 1999 105316895 3636 65.47% 71.30%

Recovery of dues from the SSI sector was fluctuating between 65% to 67%. It was 66.92% during 1998, and it was 65.69% & 65.47% during 1997 & 1999 respectively. It is noticed that recovery under SSI is comparatively lesser than the recovery under overall priority sector. It is due to the general recession prevailed the world over in all economic activity and particularly in textile sector.


The role of electric power in the industrial as well as economic development need not be over emphasised. In Erode District there are 4 Hydel Power Stations.


Sl.NoName of the Power stationYear of
Installed Capacity
(in MW)
Power Generation (in MU)
1Lower Mettur Barrage
Power House II, Nerinjipettai
11th Year30115.438
2Barrage Power House III
K.K. Medu
13thyear 30 106.604
3Barrage Power House IV
11thYear 30 86.061
4Micro Power House
10thYear 8 43.724
Total 98 351.827

The total power generation stood at 351.827 MUs in 1999-2000, the total power consumption was 503.882 MUs, excluding the Agriculture consumption, which is un metered services. Power generation in the district meets around 70% of the total demand and the rest is being met from the state grid.

Power Consumption Pattern

Power consumption by the industrial sector is 30.22%, 21.53% of the total power consumption respectively during the years 1998-99 & 1999-2000. Sector wise power consumption in this district is given below.

Power Consumption - Sector wise during 1998-2000

Sl.No Sector Consumption in Erode
District (in M.V)
% to total power
consumption in
Erode District
1Domestic 201.590 253.496 41.33 50.31
2Industrial147.383108.494 30.22 21.53
3Agriculture Un metered service - -
4 Commercial 49.024 50.821 10.05 10.09
5 Others 89.711 91.071 18.40 18.07
6Total 487.708 503.882 100.00 100.00


EHT Substations =17 Nos.
High Tension Substations =15 Nos.

Rural Electrification

1. No.of Villages Electrified :539
2. No.of Hamlets Electrified:4658

Note : All the villages and Hamlets are electrified in Erode District.

Peak Hour Demand during 1999-2000

1. Instantaneous peak demand:200.2 MVA
2. Sustained peak demand:186.0 MVA

Transport System

Better transport facilities are the back bone of industrial development. Roads provide access to remote market. Transporting the products to the markets in a shorter duration with low cost is necessary for the industries. As far as Erode District is concerned, the district head quarters is directly linked with the State Capital as well as other important places throughout the country by rail and road.

Surface Transport

Erode District has a well developed surface transport system. There is a good motorable road linking Erode with State Capital, National Capital and all other district headquarters. The total surface road length of the district is 9459.133 Kms as on 31.3.2000.

Surface Roads in Erode District - category wise (as on 31.3.2000)

Sl.NoCategory of Roads Road Length
(in kms)
1National Highways 137.200
2State Highways 3894.400
3Municipal Roads 306.071
4Punchayat Union & Village Panchayat Roads 3338.200
5Town Panchayat & Township Roads 1783.182
6Forest Roads __
7Total 9459.133

List of National Highways in Erode District

1.NH 47 - Cochin - Chennai
2.NH 67 - Coimbatore - Nagapatinam

There is a good system of motor transport operated by private bus owners and the public sector - Tamil Nadu State Transport Corporation , formerly known as Jeeva Transport Corporation. Direct bus service to all district headquarters and important centres is available including the important tourist places Mysore, Bangalore in the neighboring State of Karnataka.

Availability of Commercial and Non Commercial vehicles

Year No. of Non-commercial
% Share in
No.of Commercial
%Share in
1997-98 149105 4.56 16803 4.88


The district is served with 11 railway stations of which Erode is major station. It is well connected with state headquarter and all the places of the country. A route length of 90 kms in broad gauge is covered in this district. There is no container handling facilities available in this district, however the same facility is available in the nearby Coimbatore District at Tirupur about 50 kms away from Erode, but it is very near to the borders of Erode District.

Details of Railway routes from Erode

  1. Erode to Chennai, Bangalore, Bombay, New Delhi ( to Northern parts)
  2. Erode to Trivandram, Mangalore (Kerala & Konkan Railway)
  3. Erode to Trichy, Tuticorin, Nagerkoil (Southern parts of Tamil Nadu)


The district is not having the facility of Air Transport. The nearest operational airport is at Coimbatore, which is 90 kms away from Erode. Coimbatore Airport is a medium sized domestic airport with passenger & transport facilities.


Availability of skilled labour is an important prerequisite of industrial development. This district is having four Engineering Colleges and eight Polytechnics beside eight Industrial Training Institutes. Since most of the places in Erode District are well connected to Coimbatore and the availability of very good technical education facilities at Coimbatore, the students of Erode District are opting Coimbatore Institutions also. Details of technical educational facilities available are given below.

Technical Institutions in Erode District 1999-2000

Category No.of
Engineering Colleges 4 4603 357
Polytechnics 8 4844 319
Industrial Training Institutes 8 1167 129
Medical College 1 327 82
Pharmacy College 2 313 39
Arts & Science College 15 14418 978


Economic development depends on quick communication facilities for updating knowledge on latest technology and market information. All the villages in this district have been provided with telecommunication facilities.

There are 95 telephone exchanges with 141918 personal telephones and 3120 public call offices in use as on March 2000. There are 443 post offices of which 135 provide telegraph services also.

Post & Telegraph

1.Post Office doing postal business alone:308 Nos
2.Post Office doing Post & Telegraph business:135 Nos

Telephones 1999-2000

1. No.of Telephone Exchange: 95
2. No.of Equipped Capacity:168588
3. No.of Direct Exchange Lines:141199
4. No.of Junction Lines:0
5. No.of Telephones in use:141918
6. No.of Perosns waiting for
Telephone connection
: 23075
7. No.of Public Call Office: 3120

The National Informatics Centre functioning at the Collectorate is connected with every district headquarters as well as state headquarters through NICNET for information retrieval. With the falling prices of personal computers and the easy availability of Internet connections with lower cost through VSNL and other private Internet Service Providers, the use of personal computers and internet connections have considerably increased. This has resulted in quick communication with any corner of the world, which is uttermost requirement of successful business today.


Availability of factory accommodation with necessary infrastructure according to the requirement of factories act becomes a problem in a district where the cost of land is very high. Further, new units that may come up may find it difficult to secure amenities such as power, assured water supply, good roads etc. Industrial estates provide all such facilities in one place, thereby encouraging investment opportunities.

There are 5 industrial estates in this district promoted by official agencies.


Sl.NoName of the Industrial
Place No.of sheds
1SIDCO Industrial Estate Erode15 8 8
2SIDCO Industrial Estate Dharapuram-- 32--  
3SIDCO Industrial Estate Nanjai Uthukuli 9 5 12
4TAHDCO Industrial Estate Perundurai150   
5Perundurai-- -- 900 Acres  


SIPCOT Industrial Growth Centre aims at meeting the infrastructure needs of Textile Processing, Engineering and other industries. The centre with its accessibility to industrial towns like Tirupur and Coimbatore, is planned for medium and large scale industries and has separate parks for Textile Processing, Food Processing Industries etc.

Location: Perundurai & Ingur villages, Perundurai Taluk
Extent: 2800 Acres
Saleable Area: 1855 Acres (71.11 lakhs
Developed Area in the I Phase:1300 Acres
Cost: Rs.150/- per
Distance: Erode - 22 Kms -Nearest Railway Junction(B.G)
Tirupur - 37 Kms
Coimbatore - 78 Kms Nearest Airport
Cochin - 300 Kms - Nearest Seaport
Palakkad (Kerala Border) - 160 Kms
Suitability:Textile Processing, Food Processing,
Engineering and other industries


Water Supply: 18 MLD from River Cauvery.Arrangements
are being made for additional 15 MLD .
Drainage: Effluent collection & disposal system
Power Supply:110/11 KV Substation has been set up in
the Growth Centre

Common Effluent

Treatment Plants
: Common Effluent Treatment Plants are
under construction and expected to be
Commissioned during May 2001.
Road: Excellent roads laid
Railways: Erode - Coimbatore BG Railway Line is
passing adjacent to SIPCOT. Provision of
land for constructing platform has been
earmarked in the plan
: Separate telephone exchange is proposed
in the Growth Centre. Telephone
connections will be available on demand


  1. Cash subsidy at 15% of fixed assets with a maximum limit of Rs.15.00 lakhs for eligible industries. Leather / Electronics units are eligible for 20% on fixed assets with maximum of Rs.20.00 lakhs.
  2. Generator subsidy at 15% of Genset cost with a maximum of Rs.15.00 lakhs to eligible units

With 72 Industrial units having been established, the Perundurai Industrial Growth Centre promoted by the State Industries Promotion Corporation of Tamil Nadu (SIPCOT), is doing well. Among the industries that had come up in the complex were those engaged in chemical, plastic, turmeric and general trade. A common effluent treatment plant (CETP) was being constructed for the processing industries and was expected to be commissioned by May 2000.

Since Erode District is having a lot of textile units, especially textile processing units, the facilities available at SIPCOT will solve the problems of processing units. Also the centre is very near to Tirupur, Coimbatore District, there is a good scope for development of knitwear and readymade garments, especially for expert oriented units.

Proposed Industrial Estate (Under Development)

Sl.NoName of the Industrial EstatePlace
1SIDCO, Industrial EstateRasathivalasu
2SIDCO, Industrial EstateVadamugam Kangayampalayam
3SIDCO, Industrial EstateChennimalai

Industrial Testing Facilities

Powerloom Service Centre, Erode is the only testing Centre functioning in this district.

This centre has got a Physical & Chemical testing laboratory for testing various quality parameters of yarn and fabric and this lab had been upgraded with an investment of Rs.1.2 Crores. Now the lab has equipped with all modern computer based testing machines to provide accurate test results to the textile industry, to improve the quality of the product both for domestic and export purposes.

The number of tests conducted are as given below.

YearNo.of Parties
No.of tests
Fees collected
1999-2000 54313931,62,649

It is found that there is no testing facilities / training facilities available for food products though this district is having more numbers of food products industries.

Major Market Centres

Regulated Markets

There are 24 Regulated Markets functioning in this district. These are functioning at the following places: Anthiyur, Alangiyam, Avalpoondurai, Bhavani, Bhoothapadi, Chithode, Dharapuram, Erode, Gobichettipalayam, Kavundapadi, Kunnathur, Kangayam, kodumudi, Moolanur, Mylambady, Nambiyur, Perundurai, Punjai Puliampatti, Sathyamangalam, Sivagiri, Thalavady, Vellankoil, Vellakoil and Muthur. These markets have transacted 173368 tonnes of commodities of value Rs.28851.20 lakhs during 1999-2000. The arrivals of different commodities during the year 1997 - 98 to 1999 - 2000 are given in the table.

Arrivals of Commodities in the Regulated Markets during 1997 to 2000
Periyar market Committee

Sl.No Name of the
Arrivals in the year ( Quantity : In Tonnes)
1997-981998-99 99-2000
2Groundnut 6183 6199 6291
3Groundnut Kernal210 -- 228
4Tobacco 166917871582
5Paddy 9292 65257749
6Dry Chillies 278289202
7Sugarcane Gur 24938 49064 57528
8Turmeric 41118 46613 42720
9Cholam1251 840 727
10Cumbu 1042 570 478
11Ragi 383 358 579
12Castor 61 88145
13S.F. Seed 23361683 2527
14Coconut 5249 5531 6349
15Kopra 4138 8093 8336
16Gingelly 11613 9143 10952
17Maize 4324 4600 4100
18Others2368 5745 4253
Total129832 163129 173368

The main commodities transacted at these markets are Sugarcane Gur, Turmeric, Cotton, Gingelly, Paddy, Groundnut, Coconut etc. Among them, arrivals of Turmeric is of main interest, since Erode is the one and only market in Tamil Nadu. Turmeric is arrived not only from Erode District but also from the other parts of Tamil Nadu and adjoining district like Mysore in Karnataka State.

Arrival of Turmeric in Regulated Markets of Erode District

Sl.No Year Quantity
( In Tonnes)
41989-90 38227
61991-92 22844
81993-94 59177
91994-95 61763
111996-97 40558
121997-98 41118
131998-99 46613
141999-2000 42720

Apart from the Regulated markets, there are a lot of private marketing centres are functioning at Erode Town.


Erode is well known for marketing of textiles products of Handloom, Powerloom and Readymade Garments. Handloom and Powerloom products like Cotton Sarees, Bed Spreads, Carpets, Lungies, Printed Fabrics, Towels, Dhotis are marketed here in bulk. The products of Erode District and adjoining districts like Salem, Namakkal, Coimbatore, Karur and Dindigul districts are also arriving in this market. The textile manufacturers marketing their of these products in the weekly marketing place (Shandy) on every Tuesday at Erode. Textile merchants from all over the country are directly visiting this markets and purchase their requirements. Average turnover in this weekly shandy is around Rs.5.0 Crores. Taking advantages of this, large number of textile based Industries are coming up in Erode District and there is a good scope for development of readymade garments sector.