M.B. Patil blames Centre’s incentives to Andhra Pradesh for Google setting up AI data centre in Visakhapatnam

Minister for Large and Medium Industries M.B. Patil has blamed the Centre’s incentives to Andhra Pradesh behind Google’s choice for setting up its AI Data Centre in Visakhapatnam.

Fielding queries from reporters in Mysuru on Wednesday, Mr. Patil said the Union government, which is functioning with the support extended by Andhra Pradesh Chief Minister N. Chandrababu Naidu’s Telugu Desam Party (TDP), had given the neighbouring State an incentive of ₹22,000 crore.

‘Not on merit’

Google’s decision to set up its AI’s data centre in Andhra Pradesh was “not on merit”, said Mr. Patil, who added that it was “politically decided”.

However, Mr. Patil sought to clarify that no industries were leaving Karnataka. On the contrary, many were evincing interest in setting up shop in the State because of its “ecosystem” and availability of “talent”.

Semi conductor sector

The Minister also accused the Centre for weaning away investors, who were keen on setting up semi conductor industries in Karnataka. The same allegation was earlier made by IT-BT Minister Priyank Kharge.

When asked if the Centre was coming in the way of such industries setting up shop in Karnataka, Mr/ Patil replied in the affirmative and said the Centre, through its India Semiconductor Mission, prefers such industries to be set up in BJP-ruled States like Gujarat and Maharashtra.

“We had almost concluded discussions on a semi-conductor industry here. They had decided on Karnataka, but changed their mind after going to Delhi because of the incentives,” said Mr. Patil.

He cited the example of Micron Technologies, a semi-conductor manufacturing company, which was set up in Gujarat. With the Centre extending an aid of 50%, an industry set up at a cost of ₹1 lakh crore will get Central financial assistance of ₹50,000 crore while the Gujarat government will give another 30% amounting to ₹30,000 crore. The company will have to invest only ₹20,000 crore, he said.

GIM investments

With regard to the recent Global Investors’ Meet (GIM) attracting an investment of ₹10.27 lakh crore, Mr. Patil said already 60% of the announced investment was in the process of conversion. Unlike other States, where the announced investment is only on paper, the investment in Karnataka will convert upto 75 to 80%, he said.

Mr. Patil also cited the recent inauguration of Rolls Royce Global Capability Centre (GCC) in Bengaluru and the setting up of plants by Applied Materials and Foxconn as examples of Karnataka remaining a key investment destination for global companies.