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This article was first published 13 years ago

Is Hyderabad going the Kolkata way?

Last updated on: August 12, 2011 13:09 IST

Image: A security personnel keeps an eye from Charminar in Hyderabad.
BS Reporter Chennai and Hyderabad

Industrialists are afraid that Hyderabad, which accounts for nearly 60 per cent of the industrial activity in Andhra Pradesh, will go the Kolkata way as far as investments are concerned.

They said the movement for a separate statehood to the Telangana region was taking its toll.

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Is Hyderabad going the Kolkata way?

Image: A girl celebrates Holi in Hyderabad.
Frequent bandhs in the past two years had resulted in huge production loss and choking of investments in the state capital.

According to the Federation of Andhra Pradesh Chambers of Commerce & Industry, what is happening to Hyderabad today on the industrial front is comparable to what happened to Kolkata.

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Is Hyderabad going the Kolkata way?

Image: Pigeons fly against the backdrop of the historic Charminar monument.
About four decades ago, Kolkata was one of the top destinations for investments in India.

But no more.

In fact, there had been a flight of capital from the city over a period of time, thanks to frequent agitations and labour problems.

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Is Hyderabad going the Kolkata way?

Image: White tigers swim at the zoological park in Hyderabad.
"If the current disturbances continue to rock the state, Hyderabad, which had been the preferred destination for investments just two years ago, is likely to go the Kolkata way," Fapcci office bearers told mediapersons on Thursday.

The cities that were stated to being benefited at the cost of Hyderabad were Pune, Bangalore, Chennai and Gurgaon.

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Is Hyderabad going the Kolkata way?

Image: A view of Golconda Fort in Hyderabad.
Photographs: Courtesy: Wikimedia Commons
According to the estimate of Fapcci president VS Raju, a day's bandh observed in the state capital costs the industry about Rs. 400 crore (Rs. 4 billion).

And, there were 17 bandhs in the past one year resulting in a production loss of about Rs. 6,800 crore (Rs. 68 billion).

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Is Hyderabad going the Kolkata way?

Image: A child rests inside tomato pulp in Hyderabad.
Raju's estimates were based on the drop in power consumption by the industry on the bandh day.

The industrial power consumption during a day's shut-down declines by 400-500 Mw.

Fapcci senior vice president, Devendra Surana, said Hyderabad had lost 20,000 jobs in the manufacturing sector and an additional 40,000 jobs in the services sector due to the ongoing agitation.

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Is Hyderabad going the Kolkata way?

Image: A salesman arranges gold jewellery at a shop in Hyderabad.
Because of the frequent disturbances, the companies that had planned to invest in the state have diverted their investments to other states.

"For instance, Xerox, which had planned to set up another unit here is now setting up a plant in Tamil Nadu.

"So is Quard Cables and auto components outfit of the Surana group. This meant a loss of 1,000 jobs," Surana said.


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Is Hyderabad going the Kolkata way?

Image: A man arranges bottles of perfume in Hyderabad.
Even in the services sector, he said, many companies had stalled their expansion plans.

These include Intelligroup, Cognizant and Kedia Infotech.

Surana said even he was being forced to set up an auto components unit in Chennai.

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Is Hyderabad going the Kolkata way?

Image: Dancers perform in Hyderabad.
"I supply components to the auto industry in Chennai. Last month, due to disturbances, I was forced to send the components by flight instead of by road.

"This had cost me Rs. 5 lakh as against my usual expenditure of Rs. 20,000. Now, the auto makers are forcing me to set up a unit in Chennai to avoid any disruption in the supply chain," he said.

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Is Hyderabad going the Kolkata way?

Image: A boy jumps into the waters of the Osman Sagar Lake near Hyderabad.
"The industry is incurring the wrath of its customers," Fapcci said appealing to the agitators to exempt industry, trade and other commercial activities from shutting down whenever a bandh call is given.
Source: source