Telangana: Young, hungry & restless in the bold chase for global capital

India's youngest state courts big money with speed, sweeteners, and swagger, positioning itself as South India's challenger in the bold chase for global capital

It is India’s youngest state, formed only in 2014. Still in the investment race, Telangana has become one of the most sought-after destinations for domestic and international investors. The state has attracted around ₹2.71 trillion worth of investments in the past two years, competing with neighbouring Andhra Pradesh, Tamil Nadu, and Karnataka, and emerging as one of the most preferred destinations in South India.

 

One major advantage the state highlights compared to its rivals is its fast-track clearances. A core team from all departments constantly works with investors to ensure approvals within 15 days through its platform, the Telangana Industrial Project Approval & Self Certification System (TG-iPASS). The state is also ready to pull out all the stops — including tax incentives, free water and electricity, and even setting up zero-discharge facilities, water reuse units, and road infrastructure — to attract investment.

 

From the fight for fresh information technology (IT) expansions and new projects with Bengaluru to attracting electric vehicle and textile industry investors from Tamil Nadu, aggressive investment pitches and offers make the state attractive to investors. A perfect example of this aggressive approach is how it wooed Kitex Group, the world's second-largest children’s apparel maker, to set up shop in Telangana. Soon after promoter Sabu M Jacob announced plans to shift his new project out of Kerala, officials from Tamil Nadu, Maharashtra, Gujarat, Delhi, and Madhya Pradesh rushed to pitch to him. However, Telangana went one step further — not just with attractive offers, but by sending a chartered flight for the promoter to seal the deal the very next day.

 

To push this investment journey further, Chief Minister A Revanth Reddy’s government has set an ambitious target of becoming a $1 trillion economy by 2034, and $3 trillion by 2047. It is all set to unveil the Telangana Rising 2047 vision, outlining this road map as part of the Telangana Rising Global Summit to be held in the city on Monday and Tuesday. The Telangana Rising Vision for the next 22 years is branded with the caption: Come, Join the Rise.

 

Though the event is not pitched as an investment summit, sources indicate that some big-ticket deals are likely to be signed. These include hypervault data centres by Tata Consultancy Services and TPG with a combined investment of around ₹70,000 crore; a ₹800 crore investment by Hyundai Motor Company to set up a test track and manufacturing plant in Zaheerabad; ₹400 crore expansion plans by Mahindra & Mahindra; a ₹1,000 crore investment by electronics major Wistron; and a ₹300 crore manufacturing unit in Fab City by Crompton Greaves, among others.

 

The growth plan for 2047 includes a gradual structural shift in Telangana’s economy, with agriculture and industry shares declining from 17 per cent and 18 per cent to 15 per cent each, and services rising from 65 per cent to 70 per cent over a 10-year period. This reflects the state’s transition towards a high-value, innovation-driven services economy.

 

“By 2047, services are projected to contribute nearly $1.9 trillion, accounting for over two-thirds of the gross state domestic product, followed by industry and agriculture at roughly $400 billion each. This composition mirrors global patterns seen in advanced regional economies, where high-value services spanning IT, financial intermediation, logistics, tourism, and creative industries become the dominant growth engines,” said a source.

 

According to the document, Telangana must deliver on three fronts simultaneously to achieve the 2047 target: increase the human capital growth rate to nearly 1.75x the current pace, accelerate total factor productivity to about 1.75x its present rate, and raise the domestic savings rate towards 50 per cent to support sustained capital formation.

 

“Telangana is very aggressive in attracting investment proposals. However, the state should work more aggressively to ensure that these investment commitments become reality if it has to achieve the $3 trillion growth target,” said Rama Krishna Sangem, a veteran journalist and political analyst. This is one area the state may have to improve on going ahead, even as it continues to be aggressive in wooing investors. Experts also highlight the need to branch out into more diversified sectors.

 

One area where the state has made strong progress in recent years is global capability centres (GCCs), attracting 120 GCCs in the past two years — including Vanguard, Eli Lilly, Marriott, Evernorth, and McDonald’s.

 

The Reddy government is also facing strong opposition from Bharat Rashtra Samithi working president K T Rama Rao on investment issues. He alleged the Congress is driving away major industrial investments, citing the shifting of Kaynes Technology India’s ₹2,800 crore semiconductor project to Gujarat. “Today, Telangana is running in auto-destruct mode under the Congress,” he claimed recently.

 

Officials see the current economic summit as a stepping stone towards the $3 trillion goal. Expected industry leaders at the summit include Gautam Adani, Anand Mahindra, Anant Ambani, Kiran Mazumdar-Shaw of Biocon, Ludwig Heinzelmann from Deutsche Börse, Winston W, founding partner of Enrission, Bennett Neo from Mandai Wildlife Group, and Sheikh Tariq Alqassimi from Ras Al-Khaimah, United Arab Emirates. Following the unveiling of the Vision 2047 document on December 9, football superstar Lionel Messi will kick off a post-summit celebratory match in Hyderabad.

 

It remains to be seen whether Messi’s kickoff brings the state luck in drawing in more investment.