Santosh Patnaik

Many mega projects yet to take off

Two IT SEZs at Rushikonda facing slowdown

Coastal corridor put on the backburner

VISAKHAPATNAM: The tumbling economy in the United States and the talk of advanced polls are going to dampen the investment flow in and around Visakhapatnam.

The situation in the US has already impacted the hype the city and its suburbs had witnessed in realty market, which zoomed to an unprecedented level in the past four to five years. Investors in mega projects, both under implementation and in the pipeline, are bound to buy more time before injecting funds into infrastructure and other ventures.

French oil major Total and other members of the consortium, which will set up a 15 million tonnes Greenfield refinery and other units in the Petroleum, Chemical and Petrochemical Investment Region at an estimated cost of $6 billion, are yet to announce its investment schedule. The developments in the US have also hit work on Jawaharlal Nehru Pharma City and Brandix Apparel Park.

Visible impact

Delhi-based Unitech, a realty company, which bagged the contract for Knowledge City at Kappulapada village in an area of 1750 acres, is yet to launch its work. Same is the case with the Innovation Park project, which was allotted 90 acres at Vadlapudi by the APIIC.

The buoyancy in the economy is absence in all the sectors. There is not much progress in developing a new IT Special Economic Zone at Gambheeram in an area of 50 acres. The two IT SEZs being developed at Rushikonda are facing slowdown due to the decision to convert the sale of land to the entrepreneurs into lease. Except Kennexa, none has started their operations.

“With job cuts and fall in orders from US clients, the IT and ITES business will face a major casualty for sometime,” a software investor said. Investments in tourism, hospitality and healthcare have also slowed down.

Seafood exports

Another major casualty is the seafood industry. The US and the European Union account for 60 per cent of exports from India. The slump in the US market has adversely hit export of shrimp. Hence, the export target of Rs.9,000 crores will not be met even during current year.

Minister for Investments M. Venkata Ramana Rao said recently that no final decision had been taken on coastal corridor except laying a four-lane express road parallel to the highway on the coast. This is a complete ‘U’ turn after projecting an investment of Rs.3.43 lakh crores.