They are better positioned than their competitors having achieved economies of scale
When construction of Amaravati is completed in about a decade, some well-known companies based in Asia, particularly China, and South-East Asian countries would have left their imprint on the infrastructure and industrial landscape of the emerging capital city of Andhra Pradesh.
In addition to China, it is mostly corporate entities from Singapore, Japan, and Malaysia, specialising in urban infrastructure space, that have come forward to make investments in what is being touted as a futuristic city having few comparisons.
Setting apart their individual successes, companies from Asia and Southeast Asian countries are aided by the ASEAN (Association of Southeast Asian Nations)-India free trade area regime and partly by their geographical proximity to Andhra Pradesh (India) compared to the western countries.
The government-to-business and business-to-business deals were struck by them well before their potential competitors even sensed the opportunities that waited to be tapped.
Speaking to The Hindu , Confederation of Indian Industry vice-chairman (A.P.) J.S.R.K. Prasad said the Asian and Southeast Asian companies were better positioned to steal a march over their competitors having achieved the economies of scale in their areas of operations and reached certain levels of saturation in local markets.
China’s niche area
“China, for instance, had the fastest bullet trains cruising along more than a decade ago. Investments made in the infrastructure sector there stopped yielding the kind of impressive returns that propelled their economy to a higher trajectory. Chinese companies have since been exploring opportunities overseas and carved a niche for themselves duly backed by their governments,” Mr. Prasad observed.
Besides, the technologies and processes deployed by the Chinese and Southeast Asian companies are cost-effective and adapted to Indian conditions.
The most prominent companies from Singapore in the thick of action are none other than Ascendas-Singbridge and Sembcorp, which are for now the master developers of Amaravati. Then there are firms such as Surbana-Jurong and Temasek in the reckoning for major contracts.
PEMANDU
The other notable partnership the State government forged was the one with Malaysian Government’s Performance Management and Delivery Unit (PEMANDU) for public sector initiatives focused mainly on wealth creation.
Prominent among the companies from China is the Guizhou International Investment Corporation (GIIC). It has committed to make sizable investments in Amaravati. One of its projects that appear to take off is the Vijayawada City Square coming up in Swaraj Maidan.
Japanese companies too have shown interest in developing Amaravati under the aegis of the Ministry of Economy, Trade and Industry.
They are better positioned than their competitors having achieved economies of scale
