Andhra Pradesh Woos Tech Firms with Land Incentives
Andhra Pradesh’s LIFT Policy 4.0 aims to reposition the state as a tech hub by offering affordable land over costly Tier-1 cities.
The Andhra Pradesh government has launched its latest bid to attract investments from the IT sector with the introduction of the Land Incentive for Tech Hub (LIFT) Policy 4.0. Under this policy, the state will offer land to IT and ITES companies at a nominal rate of 99 paise per acre on lease.
To be eligible for this incentive, companies must meet certain criteria, including a minimum market capitalisation of US$1 billion or a recent listing on Fortune or Forbes. The prospective Global Capability Centres (GCCs) investors must create at least 2,000 jobs in 3 years and 500 jobs per acre.
The policy aims to reposition Andhra Pradesh as a tech hub, following the loss of Hyderabad to Telangana in 2014. By offering affordable land, the state seeks to counter the high costs associated with setting up operations in Tier-1 cities.
The Andhra Pradesh Cabinet approved the LIFT Policy 4.0 on August 5, with the condition that prospective investors must obtain necessary legal licenses and commence construction within six months of the sale agreement.
The move is seen as a strategic effort by the state government to attract investments and create employment opportunities in the IT sector. With its competitive land pricing and growing infrastructure, Andhra Pradesh is positioning itself as an attractive destination for tech companies looking to expand or set up operations in India.
The interested IT Park developers must have already developed at least 10,00,000 sq.ft. commercial office space, construct at least 1,00,000 sq.ft. per acre, and have a total of 10,00,000 sq.ft. built space.
For GCC developers, there should be an anchor tenant agreement for 20% of the built-up space, and at least 50% of the IT office space must be sold to eligible companies.
Following the state bifurcation and the loss of Hyderabad, this policy has been formulated to utilise the infrastructure and talent in Andhra Pradesh, with a focus on establishing new economic centres.
“Considering the increasing congestion and costs in Tier-1 cities like Bengaluru, Hyderabad, and Gurgaon, this cost-based attraction strategy has been formulated to be useful to people by choosing land as a development driver, eliminating relocation costs and associated risks, and attracting prominent companies,’‘ the government said in a press release.
