Khabarlive brings to you a series on what the newly elected government in Andhra Pradesh led by Chandrababu Naidu has in store as it navigates fiscal, social-economic and policy challenges. The series will explore the concerns before the TDP government and possible way forward to address key sectoral issues. Read the second part here & first part here.
Under Chandrababu Naidu’s leadership, Andhra Pradesh is witnessing a surge in investment opportunities. Naidu’s pro-business policies, focus on infrastructure development, and commitment to technology-driven growth are attracting domestic and international investors, enhancing the state’s economic landscape and fostering sustainable development.
After N Chandrababu Naidu took over as the chief minister of the truncated Andhra Pradesh for the second time about a month ago, a new eco-system conducive to investments and industrial growth seems to be emerging.
The climate for investments in Andhra Pradesh has never been better.
If his predecessor YS Jagan Mohan Reddy focused more on welfare schemes, Naidu seems more interested in landing investments.
This stems from the belief that welfare schemes, even though necessary, may not have as many electoral fire powers as one needs to win an election, as has been proved in recently concluded elections.
Spending on welfare schemes
Jagan Mohan Reddy even after spending ₹2.7 lakh crore for beneficiaries under various schemes in his tenure, could not win more than 11 Assembly in the state, the lowest ever for a party that has been in power.
In neighbouring Telangana, the BRS lost the November 2023 Assembly elections, despite implementing big-ticket welfare schemes, like Rythu Bandhu, Rythu Bheema, and Asara Social Security pensions, among others.
Naidu who is shrewd enough not to be seen as less focused on welfare as it may recoil on him politically, is shifting his focus, nonetheless, to ensuring a habitat that is more suited for investments.
He knows that in any election, the creation of employment avenues is essential for a party to flourish.
The investments, as they have the potential to produce employment opportunities for the youth, also could trigger indirect employment without the government doing anything.
Incidentally, Andhra Pradesh happens to have clocked a very high unemployment rate of 7.53 percent in March 2023. Till January 2022, Andhra Pradesh had 6,16,689 registered unemployed individuals of whom 4,22,055 were men, and 1,94,634 were women.
The district with the highest number of unemployed is Visakhapatnam, followed by Kurnool and Kadapa, according to the data submitted by the Union government in Parliament.
The skill census
On the first day of assuming office as the chief minister, one of the files that Naidu signed was related to carrying out a skill census, which is one of its kind.
The census would help the government know what skills the youngsters in the state possess and how they could be further honed to prepare for employment across the world.
With 16 MPs in his pocket, Naidu can tighten screws on the NDA government at the Centre which is dependent on him for survival.
Immediately after assuming charge, Naidu visited Delhi and gave a mile-long wish list to the prime minister.
As he handed over the memoranda to him, he seemed to have sent a message subtly that he expected the Unin government to act and not sleep over them.
BPCL investment in Andhra
A few days after he returned home, a delegation of the Bharat Petroleum Corporation Limited (BPCL) knocked at Naidu’s doors.
The delegation led by its Chairman and Managing Director M Krishna Kumar, appeared too willing to set up an oil refinery and petrochemical complex if the state alloted about 3,000 to 4,000 acres at the place of its choice.
The investment, the delegation indicated, would be between ₹60,000 crore and ₹75,000 crore, according to state Industries Minister TG Bharat.
Though it was a promise included in the Andhra Pradesh State Reorganisation Act, 2014, the Modi government did not take any positive measures during the last decade.
However, the Union government began acting on Naidu’s requests with undue haste to prevent him from reshuffling his feathers.
Even though Congress tried to make an entry, saying that it was a promise that the UPA-II had made at the time of the bifurcation of the state and therefore the credit should go to it, no one took much notice of it.
Naidu, having tasted the power he wields over the Union government, is in an overdrive, focusing mostly on how to land investments in the state.
Eyeing investments
The same day that BPCL made a commitment to build a refinery and petrochemical complex in the state, Vietnam-based auto major VinFast Auto Ltd came forward to invest ₹4,000 crore.
The company showed interest in setting up an electric vehicle and battery plants in Krishnapatnam or Orvakal in the Kurnool district, claimed Bharath.
The first indication that the state was according top priority to ensure the flow of investment came when Naidu flogged his dream project — the development of Amaravati — alive.
The project fell on bad days after Jagan Mohan Reddy came to power in 2019. With the former chief minister deciding to shift the capital to Visakhapatnam, Amaravati became dead as a dodo for the last five years.
As soon as the TDP-led NDA swept the recent Assembly elections, the real estate prices skyrocketed in the Amaravati area in anticipation of huge investments into the project.
Naidu is planning to turn the project into one that would provide employment and spur industrial growth that would, in the long run, aid in poverty eradication.
Naidu, in his first term as the chief minister of the reorganised state of Andhra Pradesh in 2014, began the construction of the capital by inviting tenders for ₹41,170 crore.
The then government had paid bills for ₹4,318 crore. However, the bills for about ₹1,269 crore remained unpaid during the last five years.
Prioritises developing Amaravati, Polavaram project
Naidu had declared that Amaravati and Polavaram were his top priorities as the economic growth of the state hinged on the two projects. If agriculture flourishes, the farmers will have more disposable income in their pockets to lift the economy, he said.
The state wants to land investments in automobile, hardware, manufacturing, pharma, agro-processing and electronics sectors as they have a good future.
In the next four to five months, the state is understood to be getting ready to promote solar, wind and pumped-storage hydro-electricity, which are becoming the new normal in the fast-changing priorities in power generation.
Besides this, the state proposes to give a fillip to the aqua and horticulture sectors and link them with pharma and food processing for handsome returns to the promoters.
The other important infra project that can potentially trigger economic development in North Andhra is the construction of Bhogapuram International Airport near Visakhapatnam.
As the port city is already an economic powerhouse, an international airport would further enhance the efforts for rapid economic growth that Naidu is visualising.
In his recent visit to Visakhapatnam, Chandrababu Naidu had said he wanted to convert Visakhapatnam into another Singapore.
Airport development
The Bhogapuram International Airport Phase-I is expected to be ready by June 2026. It will entail an investment of ₹4,700 crore by promoters GMR group.
In fact, Naidu, in his visit to the site, had said that the airport should be ready in time since the promoters and the Union Civil Aviation Minister K Rammohan Naidu are from North Andhra.
In his recent visit to Visakhapatnam, Naidu shared his vision of upgrading the “City of Destiny” into a mega med tech zone where most global medical devices manufacturing companies would be located.
During his visit to the port city, he opened two such companies in the zone which is already expanding. There are about 140 companies in the 275-acre zone.
The turnover of the companies present in the zone is about ₹10,000 crore, employing about 6,000 people.
To uplift power sector
As power is a crucial input for economic growth, Naidu, for whom the power sector is very close to his heart, turned his attention to it which, according to him, was in a rundown state under Jagan Mohan Reddy’s dispensation.
He put the legacy losses at ₹1,29,503 crore and said that he would make every possible effort to put the sector back on the rails as without quality power, no industry could flourish.
Another important milestone that Naidu crossed immediately after taking over as the chief minister was to address the bifurcation issues with the Telangana government which, when solved would lay the road for better infrastructure development in the state.
For starters, both the states at the chief ministers’ level conference held recently in Hyderabad, decided to constitute a committee of officials to which all the issues would be entrusted.
They decided that, as chief ministers, they would intervene when issues could not be resolved at the official level.
One of the important issues that the committee would look into would be ₹7,300 crore arrears due from the Telangana government to Andhra Pradesh for the power supplied in the initial days of the division of the state.
It is said that if Naidu could get the power sector up and going, half of his problems in spurring industrial growth would be solved.
Seeks industry cooperation
At an interaction with the Confederation of Indian Industry (CII) recently, the chief minister promised fresh and liberal incentives for the industry to grow in the state.
He invited the captains of industry to invest in Andhra Pradesh and said the state would provide necessary support and cooperation to them.
He stressed the need for the industry to become a stakeholder in the eradication of poverty.
“I want a zero-poverty state, zero-poverty village and zero-poverty locality,” he said, underscoring the need for the industry to extend a helping hand in the state’s mission of poverty eradication which is possible only with the rapid growth of industries in the sunrise sectors.
He wanted the industry to look at Amaravati with fresh eyes as it is on the point of takeoff to become a knowledge economy and public policy creation hub.
He said it would become the best city in the years to come, trying to convince industry stalwarts that it would be a win-win situation for the state and the industry if they moved to Amaravati.
According to Naidu, Public, Private, People Partnership (P4) is the model that the state would implement for building and infrastructure.
Initially, it might be a little difficult but, in the end, it would be a win-win situation for all the stakeholders, he said.
He also promised allotment of land in Amaravati for the second university of CII. The first one, even though planned in the state in the past, shifted to Mumbai as there was allegedly no encouragement from the previous government.
However, the caveat is that Naidu would have to take enough care not to remain a dream merchant — the tag he had earned when he conceptualised Amaravati in 2014 — and back his promises with reassuring action for the state to land investments. #hydkhabar
About The Author
