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Timely boost for Karnataka as Wistron dials in

Darlington Hector
posted on 25th July 2018
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For the Karnataka government struggling for fresh investments, Wistron’s decision to invest Rs 3,000 crore in Kolar to set up a manufacturing plant, will come as a huge relief. Wistron is the OEM for Apple, and the state has been looking forward to this investment for quite some time. In between, there were concerns whether this investment will fall through.

The investment, the government claimed, will generate 10,500 jobs. The officials did not provide a break up of the job opportunities to be created, but that’s obviously a big number. Whether these many jobs will be created or not, is a separate discussion.

There have been numerous concerns around Bengaluru’s declining ability to attract investments of late. After the city had become a magnet for IT talent from around the world in the ‘90s, investments into the manufacturing sector had declined. But that was not too much of a worry, with software continuing to power the investment scene. However, even that tag has been hit in the recent past.

According to research carried out by YourStory, Delhi-NCR has received investments worth $2.6 billion in the first six months of the year, while Bengaluru secured $1.8 billion. Mumbai came in third with $462.5 million in funding across 97 deals. However, Delhi-NCR inked only 119 deals compared to Bengaluru’s 142. So, there is no need for an alarm to be raised, but there are enough indications that Karnataka and hence Bengaluru need to step up its game.

It’s in this backdrop that we need to see the new investment that is coming in. The Wistron manufacturing facility is not just about the money. For Karnataka, it is essentially a reassurance that it has not yet lost the magic. While many feel Wistron will be manufacturing iPhones at the facility, the state government clarified that the company is yet to identify customers for the project.

The various state governments in the past have been heavily criticised for not being proactive enough. There was this feeling that the state was pinning all its hopes on Bengaluru without enough efforts towards developing its industrial ecosystem in the other cities of the state. Chief minister HD Kumaraswamy has asked Wistron to submit a proposal for grant of land required for expansion, while also suggesting that the company set up a mobile repair and technology facility.

For many years now, cities like Hyderabad and Chennai have given Bengaluru a tough time in garnering its share of investments. Later, with the state of Andhra Pradesh splitting up and the subsequent formation of Telangana, the competition has only increased.

Even a state like Kerala, often regarded as a laggard in matters of industrial development, has stepped up. Kerala has convinced Nissan Motor Co, one of the world’s biggest carmakers, to set up a global research hub that will carry out studies on driverless cars and electric vehicles. The company signed the deal with the Kerala government late last month, and the facility is scheduled to come up in Thiruvananthapuram.

So, it can be seen that many of the states are putting in additional effort to swing investments their way. Hence, it was crucial for Karnataka to announce something big and the Wistron announcement hasn’t come a day too soon.

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