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Andhra Pradesh looks to attract Rs 20,000 crore in defence, aerospace parks

Economic Times:  August, 2015

Hyderabad: Companies including Airbus, Essel Infra and Srei Infra have evinced interest in setting up large defence and aerospace parks in Andhra Pradesh that could lead to investments of thousands of crores of rupees in the state over the next few years.

Though Airbus is yet to make a formal announcement on its proposed large aerospace and defence manufacturing cluster near Ananthapur and investments involved, the state government has started earmarking land in favour of nodal agency APIIC for allotment to the French aerospace firm.

Andhra Pradesh, given its proximity to Bengaluru, the hub of Indian aerospace industry, hopes to attract both domestic and foreign firms to the southern parts of the state.

"Our teams have visited Andhra but it is very preliminary at this juncture. We need to evaluate the options and do a cost-benefit analysis to take a decision," said Srei Infra group chairman Hemanth Kanoria. Representatives of Essel Infra and Srei Infra recently met Andhra Pradesh chief minister N Chandrababu Naidu and expressed interest in exploring the opportunities in the state.

"We have been receiving interest from various players and discussions are going on," said Andhra Pradesh's industries secretary Shamsher Singh Rawat."The state offers several advantages such as robust infrastructure, port logistics, large industrial corridors of Chennai-Vizag and Chennai-Bangalore, huge land bank and uninterrupted power supply , apart from attractive tax incentives for industrial investments."

He said the state government has identified defence and aerospace manufacturing as one of the key thrust areas for industrial development in the state, aiming to attract at least Rs 20,000 crore of investments over the next five years. A senior official, who did not want to be named, said the government is also looking at developing aerospace and defence parks in public-private partnership model to provide plugand-play industrial infrastructure to investors.