Well, the Karnataka leaders made a statement that any company would come and set up their business if welcomed with tax exemptions, full waivers, free land, and subsidized power.
They implied that Andhra Pradesh did this for Google AI Hub, being desperate, and Karnataka cannot afford to do it, risking public property at stake.
Indeed, it is true! Indian states are becoming so desperate that, due to competition, MNCs are grabbing free lands and tax waivers to set up their business.
Well, what is the use of it? Indeed, Kia Motors started in Anantapur 10 years ago. Can the present government release a white paper stating how much revenue the state earned? They don’t because the setup involved a tax waiver of around Rs 25,000 crore and free land.
And is there any substantial employment generation that matches that benefit? Is there any real estate growth around? Nothing! Even the top employees working at Kia Motors are commuting from Bengaluru, as they are more attached to that city's infrastructure.
Like Kia, now there is the Google AI hub in Vizag. The so-called $15 billion is not coming to the state of Andhra Pradesh as taxes or going into the pockets of the people.
It is mostly the cost of machinery and other related expenses that the company projected over a period of five years, according to industrial experts.
While initial reports in TDP-allied media said 200 jobs immediately, the next day the correction showed 1 lakh jobs! Well, if that happens in the next five years, that’s great. At least 20,000 jobs should be created immediately this year to sustain the perception.
Can they assure that and show results? No! Because the Google AI hub technically doesn’t need that many employees. The purpose of AI itself is to reduce human workforce, a basic common sense.
Keeping that in mind, the point is, where could such Rs 20,000 crore waivers be better invested? Yes, in local industries, startups and talented youth. If such encouragement is given, the nation will grow. But why chase Kia and Google AI hubs?
Only for branding purposes, to bluff people that something is happening, and as a temporary attempt to boost real estate. Encouraging local citizens does not add any real brand value to the state's leadership, but bringing an MNC would. That’s the issue.
What is actually needed to attract investors instead of offering only waivers? Infrastructure! If cities have top-notch roads, connectivity, maneuverability and discipline, companies will line up to invest without being begged. Not spending on infrastructure in the required way is the biggest minus for our nation.
When asked, governments say, “No money, as previous governments wasted it and made the state debt-ridden.” That is the same dialogue from every party that comes to power. Is that an excuse?
We all know Google earns lakhs of crores, same with companies like TCS. Why give lands free of cost to them? It is a negligible cost for them to buy or lease.
Giving free land is effectively slavery when nothing significant is reaped from it other than mere branding for the ruling party.
Madhunandan Akkishetty