Why UP is attracting huge private sector investments
The state- which is the birth place of Lord Rama, Lord Krishna and several holy places of Muslims, Buddhism and Jainism- is reinventing itself in a big way
Before 2017, UP was hardly the last preferred destination for industrialists. Now, it is among the most preferred destination. The major reason for this shift in the thinking of investors is that the government has created a friendly environment for investors
That Uttar Pradesh is the most important state of the country in terms of politics is a well-known fact, but the state is also emerging as a huge destination for private investment is perhaps not that well-known fact. In the last month UP Investors Summit held in Lucknow, several top corporate honchos were there and announcing their investments plans for the state. The likes of Mukesh Ambani, Gautam Adani, Anand Mahindra, Kumarmanglam Birla have attended investors meet.
Uttar Pradesh has become the preferred destination for investors in the past four-and-a-half years. The state has attracted investments of more than Rs3 lakh crore during this period, half of which have materialised while the remaining half are being processed.
And imagine investment proposals worth staggering Rs80,000 crore were announced. Delhi's neighbour, Gautam Buddh Nagar bagging the lion's share in terms of investments. It bagged Rs45,529.29 crore that would go towards funding 238 projects. It is followed by the state capital Lucknow. It would receive Rs4,460.88 crore for 45 projects. After Lucknow, another district that investors have shown interest in is Gorakhpur – Chief Minister Yogi Adityanth's home turf – where 47 projects worth Rs2,828.86 crore have been approved. In fourth place, is another NCR district – Ghaziabad – where 204 projects have been proposed to be undertaken at a cost of Rs2,168 crore.
It goes without saying that this record investment will create opportunities for thousands of jobs in the state. Addressing the investors, Chief Minister Yogi Adityanath said Rs80,000-crore investments would give direct employment to 5 lakh people, while 20 lakh will be employed indirectly.
Adani Group will invest Rs 70,000 crore in Uttar Pradesh. This investment would create around 30,000 jobs. Gautam Adani said at the Uttar Pradesh Investors Summit 2022, "We are also investing Rs 24 thousand crores on road and transport infrastructure and Rs 35 thousand crores in multi-model logistics and Defence sectors."
The first UP Investors Summit was held in 2018 and the second in 2019. During the first summit, 81 projects worth more than Rs61,500 crore were launched while 290 projects with investments of over Rs67,000 crore were launched during the second summit.
Before 2017, UP was hardly the last preferred destination for industrialists. Now it is among the most preferred destination. The major reason for this shift in the thinking of investors is that the government has created a friendly environment for investors. The law and order situation has improved in a big way. Earlier, there was a missing link between industrialists and the government. This relationship between industrialists and the industry department has now strengthened.
UP watchers say that the after the law and order situation has improved, Investors have started taking keen interest in UP. Some prominent companies that have already come to UP in the recent years are Adanis. They have gotten land in Noida and are in search for more land. Hiranandanis have started work too. Land is also allotted to Microsoft. During Covid-19, Samsung Display was the first company to move out of China and opened shop in Noida.
This is also a myth that major investments still largely concentrated in western UP and Noida-Greater Noida region. Britannia has recently started work in Barabanki. Brahmos is coming to Lucknow. Bharat Dynamics Limited has been allotted 200 acres in Jhansi, in Bundelkhand. AB Mauri has been allotted land in Chitrakoot.
One must remember that for the last couple of years, UP is attracting investment in wide range of areas like defence, food processing, cement, investment in oxygen plants. Medical device parks along the Yamuna Expressway is also coming up. A pharmaceutical park in Pilibhit is planned.
If we look the big picture of last five years, we see even Samsung came. Now that the multimodal logistics hub has started in Greater Noida, it will be a state-of-the-art project found nowhere else in the country.
Noted economist Adil Zaidi says that UP implemented over 500 reforms leading to a quantum jump of 12 positions to secure the second rank in the Government of India's Business Reform Action Plan rankings. UP also jumped seven positions to rank sixth in India on 'Logistics Ease Across Different States' survey. Assuring seamless connectivity has been another mainstream agenda to transform the state's inherent disadvantage of being a land-locked state. Today, network of expressways is connecting the prominent hubs across the state. UP has become hotspot for upcoming flagship projects for multi-modal connectivity in India. One of the country's largest international airport is also coming up at Jewar not far away from Delhi. It will soon be the only state to have five international airports in the country. With a policy-based governance approach, UP government introduced more than 21 policies and land reforms to support needs of investors. As a result of all these initiatives, UP became a buzzword among investors, both domestic and international. UP has registered 21% growth in FDI inflows between FY 2017-20.
Yes, the state which is the birth place of Lord Rama, Lord Krishna and several holy places of Muslims, Buddhism and Jainism is reinventing itself in a big way. It is trying hard to shed its erstwhile image of a state that thinks only politics. As it says if there is a will, there is a way, UP is not leaving any stone unturned to become India's business power house. Even those who are coming forward to invest here, knows that what had happened in Kanpur, Prayag and Saharnpur in the recent past were just aberration. While UP is attracting investment, but still states like Maharashtra, Gujarat, Tamil Nadu, Andhra Pradesh, Karnataka and Tamil Nadu are attracting the major investment. Gujarat has consistently clocked a faster state GDP growth rate than India as a whole. Maharashtra′s location, industry-friendly culture and the presence of a large educated workforce have made it India's largest state economy. Karnataka besides being an IT hub is also a major centre for automobile, aerospace, pharmaceuticals production, and is a major global start-up hub.
Andhra Pradesh offers major opportunities for investments in the IT sector as well as in mining, infrastructure, energy. Tamil Nadu is India's most urban state and ranks second among Indian states in GDP. Can UP become like all these states? It can as it has everything to become a favourite place for investors.
(The author is Delhi-based senior journalist and writer. He is author of Gandhi's Delhi which has brought to the forth many hidden facts about Mahatma Gandhi)