JOIN USKarnataka eyes foreign companies seeking exit from China
Karnataka has constituted a special task force to woo “disenchanted” multinational companies from Japan, US, South Korea, Taiwan and Singapore among others that are looking to shift out of China following the COVID-19 outbreak.
The special investment promotion task force will be headed by the chief secretary and comprise representatives from Korean, American, Taiwanese, French and German companies that are operating in Karnataka.
“There is a pushback against China by several countries. Rising labour costs, shofiages of workforce, a trade war with the United States, the rise of manufacturing hubs in South-East Asia and now a pandemic that originated on its mainland, China may not be able to retain its position as the world's largest factory in the post Covid global economic order (sic),” the government said in an order issued Monday.
“The Japanese government is paying Japanese companies to shut their manufacturing plants in China. American companies are also planning shutdowns. So are other countries like South Korea, Taiwan, Singapore etc planning to shut their facilities in China and see India as an alternative manufacturing hub,” the order said, calling this “an opportunity for India to attract them here.”
The task force will identify sectors in which Karnataka can attract investment due to relocation of industries from other countries. The task force will also formulate special incentive packages and facilitations that are needed to attract these investments.
The task force will also look at key infrastructure projects that should be undertaken or expedited to attract investments and measures to fast-track clearances, besides recommending outreach activities and brand-building to position Karnataka as an attractive investment destination.
The constitution of the special task forces comes days after Industries Minister Jagadish Shettar held talks with industry leaders including Infosys cofounders Nandan Nilekani, Kris Gopalakrishnan and Biocon CMD Kiran Mazumdar-Shaw. They suggested the government draw up a list of 100 firms looking to move out of China that can be attracted to the state.
They also asked the government to improve the single-window clearance system for investment approvals and ease land acquisition regulations.
Soon after the World Economic Forum at Davos earlier this year, the government announced a policy change that will allow investors to purchase land from farmers in a 30-day time frame. A 30-day limit to authorise the conversion of agricultural land for non-agricultural or industrial purposes was also announced.