The newly formed government in Andhra Pradesh (AP) is actively monitoring industries investing in Telangana. Industry sources reveal that AP is striving to attract companies that have not yet commenced operations in Telangana and those planning expansions. Reports indicate that a prominent minister from AP is contacting various industry groups, offering greater incentives than those provided by Telangana.
According to a report by the Department for the Promotion of Industry and Internal Trade (DPIIT), Telangana secured the second position after Gujarat, with foreign direct investment (FDI) reaching three billion dollars in the fiscal year 2024. This is a significant increase from the 1.3 billion dollars in FDI received in 2023. During the previous BRS government, the TS-iPASS system facilitated investment agreements worth Rs. 2,60,028 crores between 2014-2023, promising to create 17.54 lakh job opportunities.
The majority of these investments in Telangana are concentrated in the IT and pharmaceutical sectors, involving both new companies and existing ones expanding their operations. Officials note that companies typically reassess several factors, including financials, before committing to investments. They also engage in negotiations with governments for concessions and incentives, often exploring opportunities in other states even after signing agreements.
Despite numerous companies signing agreements with the Telangana government, many are yet to commence operations. Officials have not disclosed details of these companies. Following the formation of the TDP government in Andhra Pradesh, there has been a strong focus on the IT and industrial sectors. The government aims to establish as many companies as possible to boost employment opportunities in the industrial sector. As part of this effort, AP is working to attract renowned global companies.
Industry sources report that a prominent AP minister has held discussions with representatives of a major company that signed an agreement with Telangana. AP is offering easier permissions and more significant concessions compared to Telangana.
Kia Motors Corporation, a leading car manufacturer, established its industry in AP during the TDP regime. Hyundai Motor Company, Kia Motors’ parent company, is building a testing track in Telangana. While there are no doubts about Hyundai’s investment, other companies are negotiating with AP to relocate their operations.