Andhra becomes nation’s reverse investment destination

Following a series of unsavory decisions taken by the YS Jaganmohan Reddy’s government, the residual state of Andhra Pradesh has lost some major investments that would have altered the gloomy outlook of the industrially backward state. The state which has taken to “reverse tendering” to save tax payers money has slipped into the not so investment friendly territory after two major projects slipped out of its hands.

Word of Caution

The word of caution came from the BJP National Secretary and Co-in charge of Andhra Pradesh Sunil Deodhar who has said in his tweet on 3 October that the Rs 70,000Cr investment on Data-Solar project, and Rs 15,000 Cr Reliance Electronic Manufacturing project shifted out of Andhra. “State revenues are falling short to pay Salaries and Interests alone as debt is crossing Rs 3.5 lakh Cr. Please earn and spend for freebies, don’t borrow. Wake up YS Jagan,” was his advice to the government.

The investment atmosphere in the country and state is likely to change in near future as the stable Government is in place and aspirations are high to become a US $ 5 trillion economy, said Confederation Indian Industries (CII) Andhra Pradesh chairman Vijay Naidu Galla. “The state Government is in the process of formulating New Industrial Policy by involving all stakeholders. We are of the view that Government is accelerating growth through Industrial development in a decentralized manner,” he said.

Sharing views with DH he said that the policy should harness the talent and facilitate inclusive growth. We look forward to work with Government on initiatives such as setting up of Skill Centers across the State which would help in creating large scale employment opportunities in the state.”

The Downtrend

The downtrend began immediately after the YS Jaganmohan Reddy government took over the reins from Nara Chandrababu Naidu in May. Naidu succeeded in bringing in Kia Motors, the Isuzu and Ashok Leyland to the state in the hope of turning the state into a manufacturing hub.

Amaravati which was to be built in an area of 33,000 acres of land pooled by the farmers on the banks of the Krishna River was the first to go under the Jagan’s administration.

The severe sand crunch a result of Jagan’s stop order of the Naidu’s free sand policy led to a situation so bad that construction major Larson and Toubro has to appeal to the High Court to control the state from stealing its sand from the constructions sites in Amaravati.

Jagan administration has sought cancellation of 21 wind power purchase agreements with clients of Suzlon Energy and Axis Energy. In a third to blow to the Navayuga group since May, the government has decided to reclaim over 4,700 acres of land allotted to Krishnapatnam Infratech for its multi-purpose special economic zone (SEZ). Earlier the government scrapped Rs 3216 cr Polavaram hydel project deal and the Machilipatnam deep water port deal.