Neighbouring States made irresistible offers and incentives, says Sabu M. Jacob
Decision-makers in Kerala, who were stuck with the proverbial frog-in-the-well attitude, must learn from neighbouring States, update themselves, and usher in reforms in order to attract investments, said Sabu M. Jacob, the managing director of Kitex Garments, at Kizhakkambalam near Kochi on Monday.
Speaking to mediapersons a day after stating that he would not invest a penny in the State any more, Mr. Jacob said he decided to focus on investments outside of Kerala with a lot of pain. It came as a shocker that officials of different departments in Kerala knew little of how investors were wooed in other States. “The share value of Kitex rose by ₹200 crore within an hour of me boarding a flight to Telengana and this does not bode well for investor confidence in Kerala,” he said.
“Stakeholders in Kerala still harp on and take pride in concepts like single-window clearance, something that investor-friendly States began trying out a quarter century ago and is now outdated. Still, the Industries Department claims Kerala is among the most investor-friendly of States. They seem unaware that most NRIs who invested in Kerala are either debt-ridden or on the verge of suicide due to the investor climate in the State,” said Mr. Jacob.
“Kitex could have grown 20 times and provided jobs to as many people had we set up enterprises outside Kerala all through the past 53 years. We do not have any more time to waste and hence decided to look beyond the State’s borders. We hope the revenue loss during the 53 years can be recouped in the forthcoming decade. The same detailed project report that KPMG readied for us to invest ₹3,500 crore in Kerala following the Ascend Kerala 2020 summit was placed before the Telengana government. Their approach was very different,” he said.
“The ₹1,000-crore investment is only the first phase of investment in that State. Mothers’ Units planned by Kitex too will be established in Telengana. We may invest in other States in the neighbourhood too, since they all have made a host of irresistible offers and incentives which will considerably even out the capital investment,” he added.
In addition, Mr. Jacob said, Kitex was assured that officials would not carry out unwanted inspections in the factory, and also that they would help rectify lacuna, if any was discovered during inspections.
Elaborating on the offers he got, Mr. Jacob said the Telengana government had assured him of all basic infrastructure support such as proper road accessibility and round-the-clock water and power supply at concessional rates. Moreover, the price of land there was only 10% of that in Kerala. The sole disadvantage there was the absence of a port nearby, to export 15 to 20 container loads of goods every day. The Telangana government had agreed to bear the additional transportation cost, he said.
“They also offered to bear the cost of treating pollutants, although we said Kitex adopts a modern two-tier treatment system which equals the quality of effluents to that of bottled drinking water,” added Mr. Jacob.
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