Coimbatore MSMEs Face Order Slowdown, See Business Shift to Gujarat, Hosur and Chennai

Micro, Small and Medium Enterprises (MSMEs) in Coimbatore, a key industrial hub of Tamil Nadu, are witnessing a notable slowdown in business activity, with many orders shifting to other states and districts, raising concerns about the region’s industrial competitiveness.

According to M. Karthikeyan, president of the Coimbatore District Small Industries Association, credit off-take by MSMEs has dropped significantly since the last financial year. “The lending target for FY26 is close to ₹39,000 crore, but capital investment activity has been sluggish in the first quarter. Banks are now conducting loan melas to boost off-take,” he said.

J. James, president of the Tamil Nadu Association of Cottage and Tiny Enterprises, highlighted a shift in demand patterns. “About 60% of orders from pump set manufacturers have moved to Gujarat. Similarly, automobile sector orders are now going to Hosur and Chennai, while textile orders have declined,” he said. He also pointed out that MSMEs that invested in high-end technology to increase productivity are struggling to secure enough orders to justify the investment.

The pump industry, traditionally strong in Coimbatore, is facing its peak season downturn. “From April to June, we usually see high sales, but this year there’s a 20–30% drop,” said Mithun Ramdass, president of the Southern India Engineering Manufacturers’ Association. He attributed the dip to unseasonal rains and a prolonged slump since July last year. “The past three months were particularly bad,” he added.

This decline is leading to job losses, fewer working days, and a slowdown in related sectors like foundries. James also noted a shortage of workers willing to take up jobs in MSMEs. “The labour interest is waning, and the situation is becoming more uncertain,” he said.

Industry leaders are now urging both Central and State governments to implement targeted revival measures to support Coimbatore’s MSMEs and retain its status as a manufacturing powerhouse.