Nation of States

MINHAZ MERCHANT The writer is the biographer of Rajiv Gandhi and Aditya Birla and author of The New Clash of Civilizations Rupa 2014). He is founder of Sterling Newspapers Pvt Ltd., which was acquired by the Indian Express Group

- Minhaz Merchant

FIVE SOUTHERN STATES are engaged in cut-throat competition to attract foreign investors. The early success of Tamil Nadu in drawing Taiwan’s iPhone contract manufacturer Foxconn to set up large manufacturing units in the state set off the race.

Tamil Nadu Chief Minister M. K. Stalin returned in September 2024 from a weeks-long tour of the United States. His entourage tied up new investment proposals with Google for setting up AI research labs in Tamil Nadu and inked a Rs 2,000 crore deal with Trilliant Networks for a production facility in the state.

Congress-ruled Telangana and Karnataka, allies of Stalin’s DMK in Tamil Nadu, are also making ambitious plans to attract foreign investment in their states. Telangana’s IT Minister Duddilla Sridhar Babu says Amazon Web Services (AWS) is likely to invest $2 billion (Rs 16,800 crore) in the state to expand its data centre. Hospitality major Marriot is meanwhile set to open its first GCC (Global Capability Centre) in India in Hyderabad. Defence and aerospace firms in the US and Europe too are lining up to establish a base in Telangana.

Karnataka, spurred by Tamil Nadu’s success with Foxconn, wants to create more Silicon Valley hubs like Bengaluru across the state. Karnataka’s IT Minister Priyank Kharge says Karnataka has the world’s fourth largest technology cluster with over one-third of India’s tech talent, 52 unicorns and nearly 25,000 startups.

Andhra Pradesh is also keen to attract foreign investment. Chief Minister Chandrababu Naidu is building a new high-tech capital city in Amaravati. As an NDA partner, it is likely to receive significant investment from the Centre while the state woos foreign firms to invest in the massive infrastructure and technology requirements of a new capital city.