In order to provide a major boost to the manufacturing and heavy engineering sector in Andhra Pradesh, the state government has asked its ministers and bureaucrats to draw a road map for attracting investment towards these lagging sectors.
While Andhra Pradesh and its capital Hyderabad earned global fame by emerging as the information and technology (IT) hub of India, the state has failed miserably compared to other states when it came to utilising its natural resources to make a mark in the manufacturing and heavy engineering field.
In recent past, the state has made some attempts to attract auto giants such as Volkswagen and Tata to set up their manufacturing facilities here. This would have not only brought business for the original equipment manufacturers (OEMs) in the state, but also encourage investment from other leading auto manufacturers. However, these projects could not materialise due to some inherent structural complexities.
Going by the precedence, the government is acting more cautiously this time so that prospective investors do not pull out their ambitious projects from the state. The recent policy initiatives taken by the Andhra government to bolster manufacturing activity have succeeded to infuse new enthusiasm among the small manufacturers in the state.
TR Balakrishnan, Manager, Himatech Engineers Pvt Ltd, a mid-sized precision component manufacturer in Hyderabad, says, “The state government’s move to offer special incentives to manufacturing companies is a positive sign. This is expected to attract more investments in this sector, which in turn, will provide an impetus to transform the state into the manufacturing hub of South India.”
Steps to success
According to the Andhra Pradesh chapter of Confederation of Indian Industry (CII), incentives such as concessional power tariff, single window clearance, 100% reimbursement of stamp duty and registration fee that have been proposed by the state government will underline its industry friendly image to a considerable extent. Apart from these, the government has also offered special incentive packages for mega projects with an investment of over Rs 100 crore.
CII has recommended the Andhra Pradesh government to develop the districts of Anantapur, Chittoor and Kadapa into manufacturing hubs as they possess great potential in this segment.
Jai Mohan, Director of Karma Engineering Works, a small-sized engineering company in Chittoor, Andhra Pradesh seconds CII’s recommendation. He says, “The district of Chittoor has the potential to become one of the foremost engineering and auto component manufacturing hubs in the state. Easy availability of cheap and skilled labour is a major advantage that manufacturing units can capitalise on. Moreover, the strategic location of the district – well connected with Bengaluru and Chennnai - will help manufacturing companies to expand their footprint in these markets as well.”
Similarly, Anantapur and Kadapa also present tremendous growth potential, and can contribute significantly in the manufacturing of cement, bio-diesel and wind power equipment.
The Andhra Pradesh government is also focusing on tipping the scale in the favour of manufacturing in the rural sector. For this, it is providing special training to the workforce in these areas and creating awareness about the multiple benefits of manufacturing over agriculture. The purpose of this move is to mobilise the rural economy and enable it to contribute significantly in the total manufacturing output of the state.
Anirban Guha |
