New Delhi: In the midst of a series of developments that have led to communal polarisation in Karnataka, many information technology (IT) firms based out of Bengaluru have reached out to the Tamil Nadu government, seeking to shift their businesses, ThePrint has learnt.
Sources in the Tamil Nadu government told ThePrint that inquiries from IT companies have started coming in “in recent times”, but the firms didn’t offer any reason for their plan to shift out of Karnataka.
In an interview with ThePrint, Tamil Nadu Finance Minister Palanivel Thiagarajan (PTR), too, said that IT companies were showing “great interest” in his state, and that many of them wanted to set up shop in Tamil Nadu. However, he refused to comment on whether these companies were coming from Karnataka or elsewhere.
“There is a massive interest, and we are already in the race. There are people actively raising this with us and our government is working on it,” he told ThePrint.
In Delhi to meet Union Finance Minister Nirmala Sitharaman as well as inaugurate an office of his party, the Dravida Munnetra Kazhagam (DMK), PTR also said that the Tamil Nadu government will soon host investor events in multiple countries abroad, namely Singapore, the United States of America and the United Kingdom, for starters.
“If we invest one rupee in capital investment, we want to match that with external investment,” he added.
He further said that his state is observing the developments in neighbouring Karnataka, and that “every threat is to be taken seriously”.
Reports of IT firms wanting to shift their businesses out of Karnataka come at a time when the state is the epicentre of a number of campaigns that are fuelling communal tension, be it the hijab row, the controversy over ‘halal’ meat, the boycott of Muslims at Karnataka temple fairs and festivals, attacks on Christians, and Hindu vigilante groups assaulting inter-faith couples.
About a week ago, Kiran Mazumdar-Shaw, executive chairperson of Biocon Ltd, had also urged Karnataka Chief Minister Basavaraj Bommai to resolve the “communal exclusion” and “growing religious divide” in the state. She had said that the state’s global leadership in the ITBT (information technology and business transformation) sector was at stake.
Mazumdar-Shaw’s remarks did not go down well with the ruling Bharatiya Janata Party (BJP). Amit Malviya, head of the BJP’s national information and technology department, tweeted that it was “unfortunate to see people like Kiran Shaw impose their personal, politically coloured opinion, and conflate it with India’s leadership in the ITBT sector”.
Karnataka, which is considered to be India’s “IT hub”, is home to the world’s fourth-largest technology cluster, and has multiple industries in operation. These include automobiles, textiles and garments, biotechnology, agro industries, and heavy engineering. The state has sector-specific special economic zones for IT, biotechnology, food processing, aerospace and engineering as well.
Meanwhile, Tamil Nadu is also home to multiple industries including automobiles, chemicals and petrochemicals, iron and steel, heavy engineering, electronic hardware, agro and food processing, fintech, aerospace, biotechnology, technical textiles, glass and ceramics, electric vehicle and battery manufacturing, and textiles and apparel.
Wooing foreign investment
The Tamil Nadu government is proactively wooing foreign investment. Chief Minister M.K. Stalin went to the United Arab Emirates (UAE) in March, where he signed memorandums of understanding (MoUs) worth Rs 6,100 crore with six companies, aimed at creating 14,700 jobs.
In the UAE, Stalin said that despite the Covid-19 pandemic, since he assumed office in May 2021, the state had signed 124 MoUs, attracting an investment of $8 billion and creating employment opportunities for 20,000 people.
In January, Tamil Nadu was declared the “most attractive investment destination”, having netted investments worth Rs 1,43,902 crore from April to December 2021.
A report by Projects Today — an online database on project investments in India — stated that Tamil Nadu had recorded a net gain of Rs 1,07,610 crore worth of investments in April-December 2021, compared to the investment of Rs 36,292 crore it garnered in the same period the previous year.
Coming second was Gujarat with a net gain of Rs 77,892 crore, and then Telangana with a net gain of Rs 65,288 crore.
Fintech companies such as PayPal, BankBazaar, e-vehicle manufactures such as Ather Energy, Ampere, DP Auto, and IT companies such as Infosys and Microsoft, have invested in the state.
Disclosure: Kiran Mazumdar-Shaw is among the distinguished founder-investors of ThePrint. Please click here for details on investors.
(Edited by Gitanjali Das)