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Why Are All Tech Giants Suddenly Investing In Telangana?

Why Are All Tech Giants Suddenly Investing In Telangana?
Image credit: BMI-BC
You're reading Entrepreneur India, an international franchise of Entrepreneur Media.

Something has to be special about a place when big firms like Amazon, Facebook, Microsoft, Google and Apple choose it as their second home.

Going through a gradual progress, Telangana will be that second home which will soon replace Bangalore as the IT capital of India. And who knows, someday the world. While we hope that day reaches fast, we definitely know for sure that Telangana is currently the most happening Southern state of India.

Now that the state of confusion that succeeded Telangana’s bifurcation from Andra Pradesh has faded, Telangana is not only on the path to recovery but using technology to transform its economy. And we all know that history has proven that to be true.  

Already a home to biggies like Facebook, Microsoft and Qualcomm, Telangana has huge investments coming from Apple, Amazon, Google, and Uber who will set up their second largest development centres there, first being in United States. These will all be located within a distance of 10 km.

A proud K T Rama Rao, Minister for IT of the Government of Telangana, sums it up saying: “Hyderabad is the biggest bang for the buck for all those investing here.”

Companies coming to Telangana

The firms mentioned above is just a gist of some of the other big ones on their way to Telangana. The list is as big as the value these companies hold.

It all began with IKEA which last year announced that it will be setting up India’s first store in Hyderabad. The world’s largest furniture retailer, IKEA bought 13 acres of land at a cost close to Rs 20 crore an acre near the IT Hub. The work is being done at great pace and the store is likely to open in early 2017. The 13-acre land was strategically located, close to the information technology hub called HITEC City, and next to an upcoming metro railway line.

The world’s richest corporate house, Apple is also coming to town to set up its second largest technology development centre outside the USA in Hyderabad at a cost of $25 million. The choice was made by Timothy Cook after considering many Eastern European countries, but it was India that won a big one here. The multinational technology company will focus on developing Apple Maps and is likely to provide direct employment to 4,500 techies in 250,000 sq. ft in Tishman Speyer’s Waverock building in the City’s IT hub.

Next in line is Uber that opened its Centre of Excellence on 26 February this year. With the aim to provide support to both riders and driver before, during and after the ride, the centre will have teams of more than 500 customer service specialists to 24/7 assistance. The team of specialists will also be proficient in multiple local languages to address support issues from across the country. In an interview to Firstpost the official spokesperson of Uber said, “Uber has already hired close to 30 percent of the total team strength and has started support operations from its Center of Excellence in Hyderabad.” Praising the government, he added, “The government of Telangana has shown great vision in supporting innovative technology companies and continues to remain an ideal location to do business.”

Google’s CEO Sunder Pichai also announced the company's plan to invest Rs 1,000 crore spread over a period of four years to establish its South Asia’s biggest development centre in two million square feet facility in Hyderabad. Also its largest campus outside the USA, this will provide employment for 6,000 people in a 7.2-acre facility in Gachibowli in the City.

The latest one to join this group is e-commerce giant Amazon Inc. who will open its biggest campus outside the US in Hyderabad by 2019. With Asia’s largest warehouse (280,000 sq. ft) on the outskirts of Hyderabad already, the Telangna government has allotted a 10-acre site for building close to three million square-foot facility to house a 13,500 member strong team.

Other than these, previously Facebook and Microsoft have had successful operations in Telangana to give a push to the startup ecosystem. Proposing an investment of Rs 2,500 crore, AirBus has put forward the wish to set up a helicopter-manufacturing unit in Hyderabad. The Company plans to collaborate either with Tatas or Mahindras in India to manufacture 100 choppers a year. This will provide employment opportunities for close to 4,500 people.

Why the rush?

Telangana proved to be a fast learner and a smart player who learned from the mistakes of other states. Following the footsteps of states like Gujarat and Tamil Nadu, who went through a similar technological revolution, Telangana made the companies come to them using a simple method - shifting the whole procedure online.

A single window concept which is called Telangana State Project Approval and Self-Certification System (TS-iPASS) run by the government gives them all the permissions and clearances within 15 days for large projects, for large scale industry. If the company is not getting that permission from the government then it is deemed to be approved and the applicant can go ahead by self certifying. It is this pro investor friendly industrial policy behind Telangana's evolution into the IT hub. 

CEO approved Telangana

Considered the poor cousin of Hyderabad, everyone wondered the future of Telangana. Now we see only brightness coming from that way. David Zapolsky, senior vice president and general counsel of Amazon said summing it up, “With a pool of quality talent, state-of-the-art infrastructure and a progressive government, the state was a natural choice for us to set up our largest campus in India here.”

Similar comments were made by Tim Cook who said, "The population in India is in some ways some of the best in the world. There's a huge amount of young people moving up the ranks and the consumer will rise up there."

Enjoying his time in India, Microsoft’s CEO, Satya Nadella said,“We are here to be a part of your success, with our accelerators where we aim to work with T-Hub. But most of all, I’m here to be inspired by your dreams.”

To make sure they reach the first position, the government will unveil its IT policy on April 4. The policies for four specific sectors - innovation, rural technology, electronics and GAME (gaming, animation, media and entertainment) will be announced.

Did India land a jackpot here?

Seems like it has.

First, we cannot hide the excitement that big organisations like Apple and Google coming to India. The scope of development is endless. Given the population we have, this will be the best utilisation of the one  of the best resource we have. The employment opportunities will boom and not only for IT sector but labour force, management, and many others. With this, we can surely expect a significant increase in country’s economy too. We will get to see the true form of Digital India.  

Edition: October 2016

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