At the recently concluded three-day Uttar Pradesh Global Investors Summit (GIS)-2023, the State has received investment proposals worth around ₹33.5 lakh crore, by means of over 19,000 memoranda of understanding (MoUs).
The State government has said this was more encouraging than expected. However, the geographical spread of the proposed investments paints a grim picture of regional disparity, economic inequality, and an investment gap between western and eastern U.P. Even within western U.P., areas close to Delhi have got more.
Areas in the State — home to roughly 250 million people — that have received the highest investment are: Gautam Buddha Nagar with its proximity to Delhi, Agra with its cultural heritage, and Lucknow as the State capital. Five of the State’s 75 districts — Gautam Buddha Nagar, Agra, Lucknow, Gorakhpur, and Varanasi — accounted for more than 50% of total investment proposals.
Winner takes all
Gautam Buddha Nagar, which is part of the National Capital Region (NCR) and has a per capita income of more than ₹5 lakh per annum, is one of the most developed areas in U.P. on this parameter. Of the total investment proposals of ₹33.5 lakh crore, it has received 27.16%.
The top four investment proposals whose combined worth is roughly ₹5.60 lakh crore for which MOUs have been signed have Gautam Buddha Nagar as a prominent location. In three of the four MoUs, districts like Lucknow, Ghaziabad, Agra, Bulandshahr, Gorakhpur, Varanasi, and Mirzapur are also named as locations in different projects. However, Gautam Buddha Nagar is common in all the top four proposals.
Causis Group, which provides EV solutions for mass transit, signed an MoU intending investment of ₹ 1,00,000 crore. The company has selected Gautam Buddha Nagar as its only prospective destination.
The commitments made in Gautam Buddha Nagar also highlight the intra-divisional imbalance. The Meerut administrative division comprises Gautam Buddha Nagar, Ghaziabad, Hapur, Bulandshahr, Bagpat and Meerut districts. The division has received the maximum investment proposals worth ₹9,85,566 crore. Of this, 80% went to Gautam Buddha Nagar, while Ghaziabad received proposals worth ₹1,05,686 crore. The remaining four districts received meagre portions from U.P.’s total investment proposals: Hapur received 1.05%, Bulandshahr 0.98%, Meerut at 0.93%, and Bagpat 0.31%.
Scraps for eastern U.P.
Within the total commitment of ₹33.5 lakh crore, the eastern U.P. districts of Ballia, Gazipur, and Chandauli, received investment proposals worth 0.06%, 0.08%, and 0.41% respectively.
In the 20-odd districts of eastern U.P., the total investment proposals comprise roughly 10% of the overall amount. However, these do not include Varanasi, represented by Prime Minister Narendra Modi in the Lok Sabha, and Gorakhpur, Chief Minister Yogi Adityanath’s Assembly constituency.
The four districts of Gorakhpur administrative division, namely Gorakhpur, Deoria, Maharajganj, and Kushinagar, attracted investment proposals worth ₹1,78,285 crore, the sixth-highest in the State. Gorakhpur, however, has received 96% of the division’s investment. Kushinagar, Maharajganj, and Deoria were at the 54th, 65th, and 68th position respectively in U.P., attracting 0.11%, 0.06%, and 0.06% respectively, of overall investment proposals.
Varanasi division shows a similar trend. While Varanasi district received 4.75% of U.P.’s total investment proposals, adjoining districts like Chandauli, Gazipur, and Jaunpur received 0.41%, 0.08%, and 1.57% of the investment intent.
Infrastructural advantages
Manoj Kumar Agarwal, a professor in the Department of Economics, University of Lucknow, said this division was natural, because it boiled down to the geographical advantage that Gautam Buddha Nagar has, with its proximity to Delhi and its existing infrastructure.
There was also a difference in the way local investors and big firms had invested, with the former looking at smaller places. “The proposals amounting to ₹33.5 lakh crore constitute three-fourths of the Union Budget 2023-24,” he said, adding that even if the ‘ignored’ areas got a small chunk of the investment pie, it would still be a sizeable amount not seen before.
When the Bharatiya Janata Party was in the opposition, it had blamed the Samajwadi Party (SP) for favourable treatment of districts like Mainpuri and Etawah. These two districts, located between western and central U.P., received investment proposals worth 0.15% and 0.09% respectively.
The ruling BJP also agreed that investors prefer western U.P. due to connectivity, but argued that infrastructure development in eastern U.P. is helping to change the game. “Things are changing as infrastructure development is on at a brisk pace in Purvanchal and Bundelkhand regions,” said Hero Bajpai, U.P. BJP spokesperson.
Professor Satish K. Jha, a political scientist at University of Delhi, said, “The investment pattern emerging … shows that the intra-regional disparity and imbalance will further get accentuated in the state. The districts getting the lion’s share … are either already developed regions, like Gautam Buddha Nagar and Lucknow, or VVIP constituencies like Varanasi and Gorakhpur. Hence, the benefit out of the much-hyped investment is fully skewed.”
