India Inc sees business outside Cyberabad

Old economy investments in focus.

With Chandra Babu Naidu ousted as the CEO of Andhra Pradesh, industry expects the state to change its focus from information technology to manufacturing, especially in the small and medium scale sector.

"The Congress will be on a better wicket for bringing in more investment in the manufacturing sector which has been sluggish in the last couple of years," Tarun Das, director general of the Confederation of Indian Industry, told Business Standard, adding: "With the Congress back in power after nine years, the manufacturing sector will get revived."

"SMEs will be brought to the forefront with the Congress focusing more on the basic needs of the rural regions," Federation of Indian Chambers of Commerce & Industry secretary general Amit Mitra said.

During the nine-year TDP rule, Naidu had positioned the state as a hub for IT companies on the lines of the neighbouring state of Karnataka. Apart from a host of Indians, several large foreign IT companies like Microsoft, Lucent Technologies and Oracle had set up a base in the state during the Naidu days.

But, of late, the hype had worked against Naidu. Nasscom President Kiran Karnik, however, said that the chnage in the government would not impact the IT industry.

Within hours of Naidu tendering his resignation, a wave of optimism swept through the old economy players in Hyderabad. SRB Ramesh Chandra, joint managing director of Coromandel Cements, said: "The need for a concrete super highway between Hyderabad and Vijayawada on the lines of Mumbai-Pune highway has long been felt. We expect the new government to take it up."

Pointing out the high rate of sickness among the mini cement units in Andhra Pradesh, Ramesh Chandra, the former president of All India Mini Cement Manufacturers Association, said Congress had earlier extended sales tax relief upto 50 per cent for mini cement units during 1991-94. The mini units strongly hope that the party would extend similar measures this time as well.

C Sekhar Reddy, the president of Andhra Pradesh Builders' Forum, said the real estate players were relieved over the Congress promise to review the Urban Land Ceiling Act. Registration charge was high at 14 per cent in the state and the Congress government should bring it down, he said.

K Koteswara Rao, Transgene Biotek chairman, said the Naidu government's biotech policy should be adhered to. "Basic infrastructural requirements such as uninterrupted power, good transportation and broadband internet access still cannot be counted on, and should be put in place immediately," he said.