By N Chandra Mohan
Telugu Desam Party’s (TDP) supremo, Nara Chandrababu Naidu, was sworn in as chief minister of Andhra Pradesh on Wednesday after securing a thumping majority in the recent assembly elections. He is back at the helm of affairs not just at the state level but also nationally as the ruling dispensation secured a third term at the Centre with the support of 16 members of parliament of TDP, which is a partner of the National Democratic Alliance (NDA).
Naidu’s priority will be to address the unfinished agenda of his earlier stint as CM of a truncated Andhra from 2014 to 2019, which includes securing special category status to further the state’s economic development, building a greenfield capital, Amaravati, and ensuring that his son, Nara Lokesh, who is in the cabinet, inherits the mantle of leadership.
Naidu has a reputation for being tech-savvy and reforms-friendly. In the past, he regularly attended the World Economic Forum Annual Meetings. The rewards for participating in the high-profile deliberations of the snowbound Davos-Klosters summit — attended by A-listers in the world of global business and top policy-makers — included seeking out prospective investors to transform Andhra.
One such spin-off during his earlier innings as CM was meeting executives of US-based Hyperloop Transportation Technologies which led to a memorandum of understanding signed in September 2017 with the state government to introduce the futuristic hyperloop transportation system from Vijayawada to Amaravati. It will not be surprising if Naidu courts foreign investors in Davos again in January 2025.
Now that Naidu is part of the NDA, he intends to derive the benefits of a double-engine sarkar to secure big-ticket investments in Andhra. These include securing a share of new investments in electronics manufacturing, semiconductors, and smartphones under centrally subsidised schemes, including production-linked incentives.
Andhra, for its part, already has Apple supplier Foxlink that makes cables for iPhone chargers. Xiaomi has a facility in Sri City in Tirupati district. So, too, is Isuzu. South Korea’s Kia Motors has a facility in Penukonda. Lokesh told the Indian Express: “We are negotiating with the Centre for funds and to bring new investments to the state. We want to be part of the $5-trillion economy dream. We believe Andhra alone can be a trillion-dollar economy.”
Investors are bound to be drawn to Andhra due to its strong economic fundamentals. For starters, it is one of the fast-growing states registering an average annual growth of 7% during the last decade, outpacing the national GDP growth of 5.8%. What has powered this robust trajectory is a dynamic agricultural sector in coastal Andhra that has prospered in the Krishna-Godavari delta region.
A forward-looking farming community has diversified into fisheries, pisciculture, and horticulture. A strong agrarian base, the second largest coastline of 974 km, a large English-speaking population, and a vast diaspora of scientists, engineers, and software professionals based in the US and other developed nations are huge advantages in an interconnected world.
However, the most ambitious unfinished agenda of Naidu is to develop Amaravati, the state’s 217 sq km capital, as a futuristic smart city. Its development was completely neglected by the previous state administration. A major positive is that the state has fertile land for the capital that is being built at the water’s edge, thanks to a unique land pooling scheme.
Farmers who gave up their land got `50,000 per month and will later get 1,000 square yards for residential purposes and 450 square yards for commercial purposes. The tab for Amaravati has been pegged at `40,000 crore to build the infrastructure and government buildings on the Krishna riverbank.
But where will the funding come from as Andhra is a cash-strapped state? Finances are also needed to honour his various electoral pledges like hiking monthly pensions. For such reasons, Naidu is banking on the ruling NDA regime as an alliance partner to help with funds and various schemes to develop Andhra through industrialisation.
N Chandra Mohan is an Economics and business commentator based in New Delhi. Views are personal.