Telangana affects AP industry; pharma cos bleed Rs 500cr
Many industrial sectors are reporting heavy losses due to shutdowns and many major proposed investors, including MNCs, are threatening to pull out of the state.
Hyderabad: The ongoing Telangana turmoil has begun to take its toll on the Andhra Pradesh economy with many industrial sectors beginning to report heavy losses due to shutdowns, amidst threats of many major proposed investors, including MNCs, threatening to pull out of the state.
Leading the losers pack are the pharmaceuticals and bulk drug manufactures who alone have lost over Rs 500 crore in the last few days, chief minister K Rosaiah said here tonight.
Addressing a hurriedly-convened press conference after a detailed interaction with CII representatives and other industry bodies here tonight, in his bid to prevent the forthcoming CII partnership summit being shifted to Chennai, Rosaiah regretted that the ongoing agitation has caused a severe dent to the state`s image as the "best investment destination".
The bulk drug industry in the state, which almost caters to the entire needs of African countries (to the extent of 90 per cent of their requirements), has been the worst hit as exports came to a halt since the Telagana agitation intensified.
"The recent spate of bandhs in the Telangana region have caused a loss of over Rs 500 crore to the bulk drugs and pharma sector as the stocks are piling up in the godowns while many supply orders have been cancelled," Rosaiah informed.
Informing that many companies have threatened to quit the state, he said "Bharat Forge was to set up a unit here but has now gone to Gujarat while French car manufacturer Peugeot has kept its investment proposals in abeyance."
The Chief Minister also informed that, "the Caparo Group, which launched its project at Sripotti Sriramulu in Nellore district, is not proceeding further while steel tycoon ArcelorMittal has also put off its huge investment proposals."
He further said the Sri Lankan apparel manufacturer Brandex is also "re-thinking" on its investment plans. Apart from units in Visakhapatnam and Nellore, Brandex was planning to set up one unit in the Telangana region. But, given the prevailing situation, it is re-thinking on this, Rosaiah said.
The current turmoil has also scared away MNCs like United Health Group and JP Morgan from opening shops in Hyderabad.
"JP Morgan was planning to create direct employment of 6,000 and an indirect employment of 2,000. But now it is reconsidering its decision,? the Chief Minister noted.
"It is time for all concerned to seriously think of the repercussions if investments stopped flowing into the state because of the scary situation. It will indirectly affect thousands of families and also lead to despondency among the unemployed youth," Rosaiah said.
Expressing the hope that the state can reemerge as the best investment destination, he said all political parties, students and those agitating for Telangan should bear in mind that the state can progress only if that image is safeguarded.
"The Centre is seriously looking into the issue of creating Telagana, and I hope and wish that it will come out with an appropriate solution. Our common goal, however, should be to ensure industrial development of the state,? Rosaiah said.