Telangana and Andhra Pradesh firms waiting for ‘acche din’
Hyderabad: The year could go down in history as the year of hope. People elected decisive leaders like Narendra Modi in New Delhi, K. Chandrasekhar Rao in Telangana State and N. Chandrababu Naidu in Andhra Pradesh, hoping that stable governments would kick-start growth in a moribund economy.
While the first half of 2014 was drowned in the din of elections, the next six months were too short a time for the leaders to make much of a difference. Despite the best efforts of the three leaders, the hopes of “acche din” by businessmen has remained just that a hope.
The inaction of the Central government in implementing tax concessions for AP and TS has forced industrialists to postpone investment decisions in both the states.
“Though the industrial scenario across the country has been bad in 2014, TS appears to be the worst affected. There have not been any new investments in the industrial sector since the state was divided, because industrialists have adopted a wait-and-watch approach to get the benefit of the special package offered by the Centre in February,” said Devendra Surana, former president of Federation of Andhra Pradesh Chambers of Commerce and Industry.
He added, “If I set up my factory in a district which won’t get tax benefits later, then I will not be able to compete with other manufacturers.”
Poor power supply in TS has compounded the problem, Mr Surana said.
The main pillar of Hyderabad’s economy the IT sector is still doing well, leaving no place for doomsayers to hide. “The year 2014 has been positive for TS. Its great advantage is Hyderabad. There has been good growth in the IT industry and the entire start-up ecosystem has matured in the city this year,” said Hyderabad-based Cyient (formerly Infotech Enterprises) chairman B.V.R. Mohan Reddy.
Mr Reddy, however, said that “acche din” would surely come. “We have got back hope and pride. But what hasn’t come back is action. Looking at the Make in India conference in Delhi, I feel the government has started taking actions.”
The year 2014 also belied the hopes of some people who predicted mass migration of companies from Hyderabad after the creation of TS. However, no major company, except one, has shifted their base. “Despite some small companies and a major glass producer, TS has not seen any major shift in companies,” an expert said.
AP on the other hand got a shot in the arm, thanks to the proposed capital. Companies and diplomats are queuing up to meet Chief Minster N. Chandrababu Naidu to dip into the business opportunity in the construction of the new capital.
