By Kavita Mistry 
The investment came on the heels of a string of major deals, including Google’s $15 billion strategic investment to establish India’s first Artificial Intelligence hub in Visakhapatnam—a move that drew sharp criticism from Karnataka, which has positioned Bengaluru as the country’s tech capital.
But perhaps what’s caused most consternation is some companies from Tamil Nadu, Karnataka and Telangana have shifted to Andhra Pradesh.
Andhra Pradesh says its proactive actions, incentives, and speedy approvals are among the factors driving companies from the neighbouring states to its doors. However, Karnataka and Tamil Nadu say the incentives and land parcels offered by Andhra Pradesh are unsustainable for their states.
Chief Ministers Siddaramaiah in Karnataka, M.K. Stalin in Tamil Nadu and Revanth Reddy in Telangana have all come under Opposition fire “losing out to Andhra Pradesh” in three key projects.
Last week, in a major blow to Tamil Nadu, South Korean footwear manufacturer Hwaseung —the supplier for global brands like Adidas and Reebok—decided to shift its Rs 1,720 crore non-leather footwear manufacturing facility, its first production base in India, from Thoothkudi in Tamil Nadu to Kuppam in Andhra Pradesh.
In March this year, Hyderabad-based Premier Energies announced the relocation of its proposed 4 GW solar photovoltaic cell manufacturing facility, with an investment of about Rs 1,700 crore, from Seetharampur in Telangana to Naidupeta in Andhra Pradesh.
As Premier Energies relocated its project to Naidupeta Industrial Park in Nellore—expanding it to a Rs 5,942-crore solar manufacturing investment—IT and Electronics Minister Nara Lokesh took to X to talk about “the speed with which AP got it done”.
“AP fast-tracked 269 acres through APIIC in record time. Talks began in Oct 2024 & land allotted by Feb 2025. The parcel is backed by ports proximity and proactive incentives,” CM Naidu’s son stated on X.
He added a video of Premier directors vouching for the hands-on approach, good infrastructure created and handholding by the state machinery.
#PE_ChoosesAP #ChooseSpeedChooseAP
Telangana-based #PremierEnergies chose #AndhraPradesh for a ₹5,942 crore solar manufacturing investment, to be set up in Naidupeta Industrial Park, Nellore. The project includes a 4 GW TOPCon solar cell unit with a 5 GW silicon ingot and… pic.twitter.com/QmU32mKmkG— Lokesh Nara (@naralokesh) November 7, 2025
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Political uproar
But the investments have sparked political uproar in neighbouring states.
When Google announced its “biggest investment” outside the US in Andhra Pradesh’s Visakhapatnam, the Karnataka BJP questioned Information Technology Minister Priyank Kharge’s “capability to attract such investments”.
The Congress minister told reporters the Opposition was conveniently ignoring the fact that Andhra Pradesh was giving Google an “incentive worth Rs 22,000 crore, 25 percent subsidy on land, 25 percent subsidy on water, free electricity and a 100 percent reimbursement of state GST”.
He went on to question whether “the state can afford this”.
Hwaseung’s shift from Tamil Nadu to Andhra Pradesh also caused a political firestorm in the DMK-ruled state, as BJP leader K. Annamalai blamed it on CM Stalin and his industries minister’s “deep slumber, as the investments they proudly announced are moving to neighbouring states”.
“In less than 3 months, Hwaseung has now decided to take this investment to Andhra Pradesh. At a time when other states are moving swiftly to attract global manufacturing, Tamil Nadu is losing ground due to complacency and administrative apathy. From being a land of opportunities, DMK has transformed TN into a land of missed opportunities,” Annamalai said in a post on X.
Tamil Nadu Industries minister T.B.R. Rajaa responded saying, “While some governments have the luxury of huge tracts of arid lands others have high value land that can’t be casually given away without guaging the outcome of the incentives vis a vis value of jobs being created. We will also at no point join a race to the bottom when it comes to offering unrealistic packages.”
Investment promotion is not a regular everyday game. It’s about balancing the states need for certain sectors, the jobs that will get created, incentives being given according to the area in which the investment is anchored etc. Our Chief Minister Thiru @mkstalin and his aim for…
— Dr. T R B Rajaa (@TRBRajaa) November 15, 2025
Opposition leaders allege the Narendra Modi government at the Centre is steering companies to invest in states ruled by the BJP or its allies, such as Andhra Pradesh, which is headed by the second-biggest party in the National Democratic Alliance (NDA), the Telugu Desam Party (TDP).
Last month, Kharge said that his state houses “38-40 percent of the country’s tech talent”, alleging that Narendra Modi-led central government has been sending away companies to places without any ecosystems.
“It is very clear that the central government is arm-twisting, poaching companies and diverting them to states where there are no ecosystems, and places that require, at least, five to 10 years more to build an ecosystem,” he told ThePrint.
“If they are really interested in getting things done, places like Bengaluru, Telangana, and Tamil Nadu are the natural choices from an investment perspective.”
He has doubled down on his allegations that the Modi-led union government was pushing investors away from non-BJP-ruled states.
Kharge told ThePrint that this was happening across sectors.
“While some companies submitted in writing to the Centre opting for Karnataka and Tamil Nadu, how are they finally setting up shop in other places. How is this happening?” he said.
Last month, Nara Lokesh took a firm stand on attracting investments to Andhra Pradesh, saying, “If other states are inefficient, what can I do?”
He urged them to focus on fixing issues like pothole-ridden roads and power cuts. Highlighting Andhra’s development mission, he added, “We are the only double-engine bullet train government in India, working to make the state and the country proud.”
ThePrint reached out to Lokesh for comment on WhatsApp, but did not receive a response. This report will be updated if and when he responds.
Both Naidu and Lokesh thanked Modi profusely when Google announced its $15 billion investment in Andhra Pradesh last month.
Speaking on the occasion, Lokesh said that Google’s Vizag data centre became possible with the support of Prime Minister Narendra Modi.
When the opposition AIADMK in Tamil Nadu targeted the ruling DMK, saying that Sundar “Pichai, a Tamilian still chose Andhra”, Lokesh responded saying, “He chose Bharat”.
Andhra officials say that going by the incentive logic, companies should be going to Odisha, Uttar Pradesh and Maharashtra first, “as these states offer the highest industrial subsidies in the country.”
“Almost all the industries nowadays engage consultants who analyse the situation, opportunities in different states and offer them advice based on which the respective state governments are approached,” N. Yuvaraj, secretary of the Andhra Pradesh Industries department, told ThePrint.
“Some firms also bargain for better incentives like one solar cell firm is presently evaluating the benefits offered by both Odisha and us to decide on its plant location,” he added.
Locational advantages are also driving investment from neighbouring states to Andhra Pradesh.
AP officials say that the state has huge tracts of cheaper land for industrial use that are strategically located close to the industrial hubs of Bengaluru and Chennai.
Anantapuram district in south Rayalaseema, for instance, is closer to Bengaluru than places like Mysore and Tumkur in Karnataka. Similarly, Sri City, Nellore and Kuppam are not far from Chennai, an automobile and manufacturing hub, where land is far more expensive.
As a result, while Bengaluru has a robust defence and aerospace ecosystem, firms seeking affordable land prefer to go to Anantapuram instead.
Andhra Pradesh officials cite the example of Agneyastra Energetics—incorporated through Bharat Forge’s wholly-owned subsidiary, Kalyani Strategic Systems—which signed an agreement with the Andhra Pradesh Industrial Infrastructure Corporation to acquire a 950-acre land parcel in Madakasira in Anantapur district at about Rs 7 lakh per acre.
For now, Andhra Pradesh seems to have an edge with NDA ally Naidu in the driving seat and its locational advantage. Will the neighbouring southern states be able to match Andhra Pradesh and attract investors?
With inputs from Sharan Poovanna
(Edited by Sugita Katyal)
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