Karnataka vs Andhra Pradesh: The Battle for Investment Amid Bengaluru's Infrastructure Challenges

New Delhi:

Karnataka and Andhra Pradesh continue their rivalry over infrastructure issues in Bengaluru, particularly regarding potholed roads and garbage management, which has implications for investment opportunities. The latest development in this interstate competition follows Google's decision to invest $15 billion in Andhra Pradesh for a significant data and AI hub.

Google's investment choice prompted Karnataka minister Priyank Kharge to make pointed remarks about Andhra Pradesh's reported incentive package, which allegedly includes Rs 22,000 crore in subsidies along with tax and utilities exemptions.

In response, Andhra's Nara Lokesh offered a direct rebuttal: "If they (the Karnataka government) are inefficient, what can I do? Their own industrialists say the infrastructure is bad... there are power cuts. They should first fix those problems."

Lokesh candidly told NDTV that Andhra Pradesh had already secured over $120 billion in investments and acknowledged that their rapid reform pace had created tensions with Karnataka. However, he maintained that states concerned about this competition needed to respond accordingly, stating, "That is their challenge..."

The criticism extends beyond Lokesh, with Karnataka's former ally Janata Dal Secular criticizing the Congress-led government for failing to address critical issues including irregular electricity and water supply, alongside other infrastructure deficiencies.

The interstate tension was further inflamed by Biocon chief Kiran Mazumdar-Shaw's social media post, where she recounted a Chinese colleague questioning Bengaluru's poor road conditions and garbage management, asking, "Doesn't the government want to support investment?"

This tweet, combined with Bengaluru residents writing to Chief Minister Siddaramaiah threatening to withhold property tax payments unless the city's dangerous potholes and deteriorating infrastructure are addressed, escalated the controversy.

Deputy Chief Minister DK Shivakumar and Kharge defended Karnataka vigorously, with Shivakumar asserting, "You can't match Bengaluru infrastructure, startups, human resources, and innovations..." He dismissed attempts to attract businesses away from Karnataka, adding, "Let them do whatever they want."

Shivakumar also posted on social media that the administration is prioritizing 'smooth traffic' and noted that "The work of asphalting roads at various places in the city and filling potholes is progressing swiftly."

On Tuesday, he reported that 13,000 potholes have been filled so far, and mentioned that the government is working toward a 'permanent solution' for the city's road issues, including a Rs 1,100-crore action plan.

Regarding Mazumdar-Shaw's comments, Kharge stated that "Constructive criticism is welcome... negativity does not," and cited factors including 'unprecedented rains, high growth rate, massive urbanisation as the result of large numbers of migrant workers' as contributing to the infrastructure challenges.

"If you have anything constructive to say, then we will take it...." he added.

This episode in the Karnataka-Andhra Pradesh rivalry began in mid-September when Rajesh Yabaji, co-founder of a Bengaluru-based logistics company, complained about extended commute times and poor road conditions near his office in the Bellandur area.

Lokesh promptly responded to Yabaji's social media post by suggesting Vizag as an alternative location. As more Bengaluru-based businesses, business leaders, and residents voiced concerns about the city's infrastructure problems, he increasingly promoted Andhra Pradesh as a potential investment destination.

Among the locations being promoted is Anantpur, which is closer to Bengaluru than Vizag, where Lokesh claimed a 'world class aerospace and defence ecosystem' is under development.

Lokesh's promotional efforts elicited a sharp response from his Karnataka counterparts.

Kharge referred to 'weaker ecosystems feeding off stronger ones' and highlighted Bengaluru's GDP, which is projected to grow at 8.5 percent annually until 2035, potentially making it the world's fastest-growing city economically.

He concluded with a thinly veiled criticism: "By the way, what is an organism that lives in or on an organism of another species and benefits by deriving nutrients at the other's expense called?"