Listen

Pause Resume

South India is fast emerging as the country’s economic engine—powered by a deep industrial base, surging tech sectors, and strategic policy support. Home to Karnataka, Tamil Nadu, Telangana, Andhra Pradesh, and Kerala, the region now contributes nearly a third of India’s GDP. From global IT-ITeS hubs and advanced manufacturing to biotech, aerospace, and semiconductors, its rise is no accident. It’s the result of decades of investment in infrastructure, talent and innovation—positioning it as a global investment destination and a blueprint for the country’s next phase of growth. Over 60% of India’s operational Special Economic Zones (SEZs) are located in the region, underscoring its industrial prowess.

Infrastructure serves as the bedrock of this boom. Karnataka, home to Bengaluru, benefits from two international airports, over 8,000 km of national highways and major industrial corridors like the Chennai–Bengaluru Industrial Corridor (CBIC) and the planned Hyderabad–Bengaluru Industrial Corridor. Tamil Nadu boasts four international airports, four major ports, and extensive road and rail networks, with upcoming industrial corridors connecting Chennai to Bengaluru, Kanyakumari and Kochi. Telangana’s Hyderabad is bolstered by an international airport, a vast highway network including a 340 km regional ring road and industrial corridors linking it to Warangal, Nagpur and Vijayawada. Kerala’s Kochi, a key port city, is transforming with its Metro Rail and Water Metro, alongside four international airports across the state. These projects ensure seamless connectivity and logistics, crucial for business expansion.  

Complementing the infrastructure are proactive government policies designed to attract and retain investment. Karnataka’s IT and GCC policies aim to solidify Bengaluru’s position as a global capability hub while encouraging growth in Tier-II cities. Tamil Nadu’s sector focused policies across FinTech, Data Centers, and EVs and manufacturing have drawn a steady stream of investment. Andhra Pradesh’s IT & GCC Policy 2024-29 offers incentives such as rent exemptions and job creation subsidies for cities like Visakhapatnam. Kerala’s GCC Framework, meanwhile, targets emerging technologies and supports a thriving startup ecosystem. 

This synergy of infrastructure and policy is already visible on the ground. Between October 2019 and March 2025, Karnataka received US$57.7 billion in foreign direct investments (FDI), while Tamil Nadu attracted US$14.7 billion. 

As the region doubles down on infrastructure and reform, the southern states’ role in India’s growth story is becoming ever more central. Continuous investment in infrastructure and a responsive policy environment are helping drive strong economic growth and a promising future.