Vijayawada: Andhra Pradesh (AP) has been a late starter among Indian states in attracting investment, especially after Telangana was carved out of it in 2014. But it recently punched well above its weight, signing a $15 billion investment from Google to set up an artificial intelligence (AI) hub and data center. Nara Lokesh, Minister of State for Human Resource Development, IT and Electronics, and son of Chief Minister Chandrababu Naidu, spoke about AP’s strategy to attract investment, inter-state competition and his sparring with Karnataka ministers. Edited excerpts:
How well are you doing on the investment front?
It was an amazing journey. So far in the last 17 months we have been able to get close to $120 billion worth of firm commitments, which is unheard of in the Indian context. But I’m hungry. I want it to be a trillion dollars. I will sleep well the day we have a firm commitment to invest a trillion dollars in Andhra Pradesh.
You focused on speed and not ease of doing business. How did it work?
It helped us start many projects. Historically, the ease of doing business has been more about simplifying the regulatory side. Once we shifted our mindset towards speed, it was all about how quickly we could grasp a project and see it through its entire life cycle. Consider Google. It is a 15 billion dollar project. Just imagine the interest costs if there is a six month delay. As the size of the investment increases, it is important that states run faster. I believe India should run faster.
Speed has now become part of our culture and a clear distinguishing mark. At the partnership summit to be held in Visakhapatnam on November 14-15, 410 MOUs (memorandums of understanding) will be signed, involving investments of up to US$ 100 billion with employment potential of more than 700,000 jobs.
How do you see this competition between states to attract investment?
When states compete, India wins and I truly believe that. States should compete and each will have its own competitive advantage. Some will provide more incentives and some will offer a better ecosystem. AP is about the speed of business. And that makes us very unique.
This competition sometimes leads to a war of words…
Yes (laughs). It triggered the use of certain language (a war of words between him and the Karnataka ministers). What my neighboring state has done is make us angry with words. There is no need to use these words. We have been and will continue to be very dignified in our approach. Politically, we will shoot, but we will not hit below the belt.
You have been accused of unsustainable incentives to attract investment…
All states offer incentives, whether we give a rupee more or less is the only debate. More than the fight for incentives, our ability to foster relationships and deliver tangible results at record speed is demonstrated. ArcelorMittal’s investments were not made solely on the basis of incentives. It was our ability to work with them, understand their needs and get things done. We are honest in our relationship. And that’s why we win. It is very unfair to say that we give a lot of incentives. If that is the case, we should not lose investment in other countries.
Are you not offering land for 99 paise?
Yes, we do. The only way to get investment where the ecosystem doesn’t exist is to offer such incentives. Take the IT sector. Without such offers, we would not have been able to bring TCS and Cognizant to Andhra Pradesh. They would like to expand in Bengaluru, Hyderabad or Chennai.
Work was another area of interest…
Absolutely. The first promise we made in our election manifesto was to create 2 million jobs. We don’t just bring investments to the state. We actively match the supply and demand of the required skills and fill the gaps. We also see jobs and investment as a way to overcome the financial stress that the country is in after the bifurcation. We will achieve this under the leadership of our veteran leader and Chief Minister Chandrababu Naidu. He leads a young team. We are his rockets and he is the GPS ensuring we reach our goals.
