Hyderabad: Aerospace and defence companies wanting to implement a China plus one business model or exit China to set up operations in India are being armtwisted by the Centre to choose Bundelkhand region for their operations, Industries and IT Minister KT Rama Rao alleged here on Wednesday.
Such an attitude by the Centre has resulted in Telangana losing a prospective investment here. “A large aerospace and defence company wanted to exit China and set up operations in India. But the union Government was armtwisting it to set shop in Bundelkhand. The company did not want to go there, but was preferring Hyderabad. “If a company or investor does not get proper response, it would look for other countries,” he cautioned.
Rama Rao also recollected another instance in which the Defence Industrial Production Corridor was decided in favour of Bundelkhand. “We requested that this corridor be set up between Hyderabad and Bengaluru as both cities have defence public sector undertakings and aerospace and defence ecosystems in place. This would have allowed the industrial cluster to hit the ground running. However, the Defence Minister said the decision for the location was already made,” he told the CII Telangana State Leadership Summit here on Wednesday.
Maintaining that he wanted Uttar Pradesh to grow, he wondered whether UP was capable of attrracting a Lockheed Martin or a Sikorsky or a large aerospace company and give them the confidence of hitting the ground running? “If you really want India to prosper and grow, support the States which are doing well and those who have ecosystems in place,” he asserted.
He said the States could not be preferred based on the number of MP seats it has. “We cannot say UP has 80 MP seats and therefore we will focus on that. Telangana has 17 seats, so we will not do it here”, remarked pointing out that Telangana was also part of India. He remarked that Hyderabad was not in competition with Bengaluru, Delhi or any other State but it was competing with Malaysia, Indonesia, Vietnam to attract electronics, textiles players and other industries.
Though India and China had similar size of economies in 1987, China’s GDP now grew to touch $16 lakh crore, about six times more than that of India’s $ 2.6 lakh crore. China grew because it chose to set up industrial clusters in 50,000 to 70,000 acres. India’s biggest pharma cluster was coming up in 14,000 acres in Hyderabad. Telangana also set up the largest textile park in Warangal in 1,200 acre. “We have been requesting GoI to support us in these projects,” Rama Rao said.
Though India was keen on pushing Make-in-India, it did not back it up with the right policies. India was dependent on China for APIs used in making drugs and even masks and PPE kits. “If China had shut shop opr if China had said no during the pandemic, I think the industry would have suffered a great deal. Masks and PPEs are cheaper to import than making them here. Automakers are not able to cater to the demand due to the shortage of chips. “Small countries like Taiwan and Singapore have been able to create multiple fabs but not India,” he said.
India’s textile and apparel production is just four per cent of the world’s production and lagging behind even Bangladesh and Sri Lanka. “With such a large workforce and a sector with vast potential to create employment, can India not have a textile policy to get these centres running in tier 2 and 3 cities, or even smaller towns and hinterlands. Can we not have them in UP, Madhya Pradesh, Bihar and other States that continue to hold us back in terms of growth? That is because of the strategic inability to come up with innovations, inability to rethink ourselves. UP has 22 crore population and its contribution to GDP is 15 per cent. Telangana, which has a four crore population, contributes five per cent to the GDP,” he said.
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