Investment-starved Andhra Pradesh seems to have lost at least two major projects, which were set to land in the state, following the Vibrant Gujarat event. Though the officials are loathe confirming this, sources say projects from Hyundai and Bombardier are getting diverted to Gujarat.
Hyundai had zeroed in on Andhra Pradesh for an automobile spare parts project after evaluating Tamil Nadu as an option. The official sources had earlier said the company was seeking 50 acres of land for the first phase of its project with an investment outlay of Rs500 crore and a similar quantum of land for the second phase with an investment plan of about Rs700 crore.
Andhra Pradesh has been desperate to attract automobile investments and the lack of an ancillary set up is said to be the key reason behind the automobile units avoiding investments in the state.
With this in mind, the state government has been developing the bordering areas of Tamil Nadu as potential investment regions for automobile companies. Hyundai too was shown one such location near Chennai for investment.
“Hyundai has made a presentation in Gujarat recently and the project is all set to go there,” a source tracking the developments said.
Similarly, Bombardier, which has a long-term tie-up with engineering software company Infotech Enterprises for technology support, had earlier approached Andhra Pradesh with an investment plan.
However, “there was no follow up from the state government. So, after a point of time, no one knew the status of Bombardier’s plans,” the source said.
The investment event held in Gujarat is pushing the state government and the agencies operating with it into an introspection mood.
“We have always considered Gujarat as a serious competitor in terms of the state’s efforts in attracting investments. While it is proving to be difficult to attract investments in the last two years or so, some of the big names in the state’s industry, particularly from the pharma and infrastructure segments, were seen vouching for Gujarat’s growth in the recent event,” a senior functionary of the Confederation of Indian Industry (CII).
Andhra Pradesh was at the forefront of conducting investment meets jointly with the CII. The first partnership summit was held in Andhra Pradesh during Chandrababu Naidu’s regime.
However, the CII has been working hard to conduct yet another edition of the summit in Hyderabad. “We have been working on that since 2009. But, either due to the lack of interest from the government or the instability in the political situation backed by separate Telangana movement, the summit remains elusive. We thought of doing it in the second half of 2010 and now it stands pushed to some day in 2011. We are still not confident about it,” the CII representative said.
The state government had in fact decided to take an active part in Vibrant Gujarat event to attract some investments into the state. However, though it had decided to take a stall and showcase the state’s industry’s policy, the criticism over a Congress-ruled state participating in a programme organised by a BJP government did not allow it to pursue the plans.
The state government also decided not to send any senior official to Gujarat fearing political backlash.
“We had sent only some junior officials. Some of our senior officials were supposed to be there to make presentations about the state. But, the plans were put on hold,” an official source said, without giving the reasons.
