State on a roll, attracts big names, investments

AWS decision to make Hyderabad second hub in India a jewel in the crown

For Telangana, Amazon Web Services’ (AWS) announcement that Hyderabad will be the second AWS region in India and host a set of data centres marks a new high in the State’s efforts at attracting investments.

The estimated capital investment of $2.77 billion (₹20,761 crore) AWS will make to establish the data centres is not only the largest FDI in the State thus far, but also a pointer to the ecosystem Telangana has nurtured to act as magnets for such investments.

Hyderabad on top

Industries and IT Secretary Jayesh Ranjan said AWS had also evaluated a few other States, but chose Telangana as “we were offering the best” and more importantly, Hyderabad scored high in terms of how well the data centres will be utilised. “They were more confident of the off-take of the data centre in Hyderabad since [core customers] e-commerce, banking, insurance [firms] were deeply entrenched,” he said. The three data centres, or Availability Zones as AWS calls them, will come up on 132 acres on the outskirts of Hyderabad.

India’s Data Protection Act, especially data localisation norms, as well as business opportunity that the National Digital Health Mission and the government’s cloud strategy will open up are larger contextual factors accelerating the decision on setting up of such data centres.

For e-commerce giant Amazon, the latest decision builds on its engagement with the State in the past few years, the most prominent of them being setting up of a 3-million sq.ft. campus building on 9.5 acres in Hyderabad, its single largest building globally.

AWS announcement is the biggest and forms part of a series of such investment commitments and facility opening by a clutch of companies across industries in the State of late. Figuring in the list are Welspun group, Medtronics, Goldman Sachs, drugmakers Granules and Laurus Labs, EV makers and RE firms Mytrah, Olectra, Eto; as well as the homegrown Medha Group.

Mr.Ranjan said it is a continuous process since “many of these investments decision are taken over a period of time.” On whether COVID-19 was a factor that influenced the company’s decision on investment, he said it did impact but “temporarily in the initial days.” But in some sectors such as pharma, the pandemic also accelerated the firm’s decision.

Did the drop in the Ease of Doing Business ranking prompt the State to push the envelope, he said companies are increasingly realising that more than rankings what matters is whether the government stands by investors post investment like Telangana, handholding them and addressing issues at every stage.

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