The ongoing unrest in Andhra Pradesh is likely to shake business confidence and impact its image as a preferred investment destination, the Associated Chamber of Commerce and Industry of India (Assocham) said on Wednesday.
The State has 1,536 live investment proposals worth Rs 934,143 crore, up over 20 per cent from 1,449 live investments worth Rs 775,064 crore last year. Nearly 60 per cent of these were from the private sector.
“Investors get jittery as general life is paralysed and business establishments are shut for days together,” said Assocham's Secretary-General, Mr D.S. Rawat.
Andhra Pradesh has 7.5 per cent of total investments across the country. Almost 58 per cent of these are already being implemented and 38 per cent are in announcement stages.
Sectors such as real estate with a share of 42.3 per cent, power with 40.6 per cent and manufacturing with 15 per cent have helped the State bag 87 additional live investment proposals in the past one year.
Services sector and irrigation showed marginal rise of 8.6 per cent and 5.6 per cent respectively while the mining sector registered a dismal performance with a drop of 9.6 per cent over the year.
PRIMARY SECTOR
According to a recent ASSOCHAM study, primary sector accounted for 25.2 per cent share in the State Gross Domestic Product (SGDP) of which agriculture and allied activities recorded a share of 21.9 per cent while mining and quarrying registered 3.3 per cent share.
Andhra Pradesh topped the southern region with primary sector registering the highest contribution of 25.2 per cent to the SGDP followed by Karnataka (15.4 per cent) and Tamil Nadu (11.1 per cent) in the past one decade.
“Andhra Pradesh needs to introduce more investor friendly policies,” said Mr Rawat. “Steps taken by the State Investment Promotion Board (SIPB) to give 50 per cent VAT/CST or SGST reimbursements along with other incentives for next five years are in the right direction.”
Infrastructure proposals
The trade body also recommended that the Rs 1,590-crore Machilipatnam Port Project needs to be completed fast and linked with an eight-lane highway. For this purpose, an inland container depot with modern logistic facilities must be set up near Hyderabad. Airports at major destinations such as Tirupati, Vijayawada, Vizag and Nizamabad should be developed on a PPP model to attract investments.