Industrial Development & Economic Growth in Telangana

Telangana was formed in June 2014 with Hyderabad as its capital. The state was formed as a result of the split of erstwhile Andhra Pradesh state. The state holds an advantage as it possesses readymade capital with necessary infrastructure and ecosystem. Hyderabad was ranked second among the top 20 global cities in JLL’s City Momentum Index (CMI) 2019.

The capital city of Hyderabad (also the capital for earlier larger Andhra Pradesh state) is a hub for information technology (IT) and pharmaceutical sectors. IT and ITeS exports from Telangana increased at a CAGR of 11.47% from 2013-14 to Rs. 1.2 lakh crore (US$ 18.15 billion) in 2019-20.

Telangana's Gross State Domestic Product (GSDP) expanded at a Compound Annual Growth Rate (CAGR) of 11.10% (in Rupee terms) to reach Rs. 9.78 trillion (US$ 134.78 billion) between 2015-16 and 2020-21. Tertiary sector has been the largest sector, growing at a CAGR of 13.16% (in rupee terms) between 2011-12 and 2020-21, accounting for 60.35% share of the overall GSDP.

In 2019, domestic tourist arrivals in the state were 83.03 million and foreign tourist arrivals crossed 0.32 million.

As of February 2021, the total installed power capacity in Telangana was 16,931.08 MW. Of this, 8,223.65 MW was contributed by state utilities, 6,531.28 MW (private utilities) and 2,176.15 MW (central utilities). Thermal power was the largest contributor to the state’s total installed capacity with 9,941.19 MW, followed by hydropower (2,479.93 MW), renewable energy (4361.23 MW) and nuclear power (148.73 MW).

As of October 2020, Telangana had 34 operational SEZs, 56 notified SEZs and 63 formally approved SEZs.

According to Department for Promotion of Industry and Internal Trade (DPIIT), cumulative Foreign Direct Investment (FDI) inflow in Telangana totalled US$ 1,539.82 million during October 2019 and December 2020.

Total merchandise exports from the state stood at US$ 7.35 billion in 2019–20. Export stood at US$ 7.16 billion between April 2020 and January 2021. In 2019, 74 investment intentions with proposed investment worth Rs. 5,432 crore (US$ 777.2 million) was filed in the state.

Some of the major initiatives taken by the government to promote Telangana as an investment destination are:

• In October 2020, the State Government rolled out 10-year Electric Vehicle (EV) policy with the aim to attract US$ 4 billion investments. The policy will aim to make the state a hub for electric vehicles and energy storage systems, and to create employment for 120,000 people through shared mobility, charging infrastructure development, and manufacturing activities.
• During 2018-19, Telangana State Innovation Cell (TSIC) launched ‘Startup India Telangana Yatra’ with an attempt to promote entrepreneurship in tier II and tier III cities
• In October 2019, Hyderabad Metro Rail crossed significant milestone with the number of passengers travelling on trains crossing the four-lakh mark for the first time.
• In September 2019, TSIIC launched the Pharma City project at Mucherla village in Ranga Reddy district, spread across 19,000 acres and the Medical Devices Park located at Sultanpur village of Sangareddy district.
• The State Government is setting up the Hyderabad Pharma City, which will be the first of its kind, smart ecosystem creating a new international benchmark for Sustainable Industrial cities. The project will be developed over an area of 19,000 acres and is expected to attract Rs. 64,000 crore (US$ 993.02 million).
• Telangana is a pharmaceutical manufacturing hub in the country and has attracted investment worth Rs. 10,000 crore (US$ 1.49 billion) in the life sciences sector in the last four years. Pharmaceutical export also has a majority share in the total merchandise export from the state. During 2019-20 (till December 2019), pharmaceutical products export from the state stood at US$ 3.48 billion.

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