The Delhi National Capital Region (Delhi NCR) encompasses the National Capital Territory (NCT) of Delhi and several districts from the surrounding states of Haryana, Uttar Pradesh and Rajasthan.
Delhi is one of the fastest growing regions of India, with a consistent growth rate of about 12.82% in 2018–19. Foreign direct investment into Delhi was US$9.5 billion between 2019 and 2021. Key sectors include light manufacturing, retail, e-commerce, and logistics.
Delhi NCR has a population of more than 46 million people. With an urbanisation level of 62%, it is one of the largest economic centres in India, and accounts for around 4–5% of India’s GDP. It has the largest share of skilled workforce in the country – 30% of whom qualify for jobs within the PMET sectors.
Ongoing developments in Delhi NCR:
Karnataka ranks as the 4th largest economy in India, achieving a GSDP of US$230 billion in 2020. According to the Department for Promotion of Industry and Internal Trade (DPIIT), the state’s cumulative FDI inflow stood at US$11.95 billion between October 2019 and March 2021, the 3rd highest in India.
The capital of Karnataka, Bangalore (officially known as Bengaluru), is a major IT hub. Often described as the Silicon Valley of India, it is home to MNCs such as Apple, Intel, Cisco, Adobe, Google, and accounts for some 35 percent of the global in-house centres in India. There is also a heavy concentration of R&D centres in the state, including that of Amazon, IBM, Tesco, and Microsoft. Its progressive policies on the technology front and abundance of talent have led to the growth of a vibrant start-up ecosystem in Bangalore.
The launch of a Global Innovation Alliance (GIA) node in Bangalore will facilitate and support the two-way flow of startups, technology and ideas between both countries. In collaboration with our GIA Bangalore partner Anthill ventures, the GIA program runs immersion programs for Singapore startups to help launch them in the India market.
Singapore companies ranging from startups to large corporates have invested and operated in the state. Companies like CapitaLand, Mapletree and Keppel Land are involved in developing and operating commercial building assets across Bangalore’s rapidly growing urban footprint, ranging from IT Parks, co-working spaces and residential entities.
Bangalore’s geo-centric location makes it an important logistics distribution node. Companies like YCH and Worldgate have distribution centres and offices in Bangalore. Notably, SATS and Air India have entered a joint venture to develop the AI-SATS CoolPort at Bangalore International Airport, which is India’s first integrated on-airport perishable cargo handling facility.
Bangalore is also the headquarters for several large e-commerce players like Flipkart, Myntra, Amazon India, BigBasket, and its cosmopolitan culture makes it a key metro for the distribution of consumer goods (including food products, quick service restaurants and fashion brands). Singapore companies continue to seek partnerships with these players through online listings as an asset-light mode of market entry, as well as through the provision of services such as e-fulfilment and e-payment.
The New Industry Plan 2020 – 2025 released by the government of Karnataka focuses on economic development in several key sectors, such as mobility and EVs, ports and logistics, tourism, aerospace, electronics and manufacturing.
Maharashtra has the largest gross state domestic product (GSDP) among the 33 Indian States and Union Territories, making up 14.4% of India’s total GDP1. Key cities of Maharashtra include Mumbai and Pune.
Being the second most populous state in India with over 110 million, Maharashtra contributes to 40% of India direct tax.2 The large GSDP and population makes Maharashtra an attractive proposition in terms of market size.
Maharashtra is also home to many large Indian business houses and Multinational Corporates (MNCs), such as TATA Group, Aditya Birla Group, Reliance Industries (Jio), P&G and Hindustan Unilever. Most of these companies are headquartered or have offices in Mumbai and Pune, the commercial and financial hub of India. Some Singapore companies that have ventured in the region include PSA, Keppel Land, Capitaland and DBS Group.
To meet the needs of the growing urban population, Mumbai and Pune are undertaking major infrastructure projects including new metro lines, new expressways, transit-oriented depots and incorporating digitalisation into their SMART city implementation.
1 Statistics Times, 2020 2 International Business Times India 2020
With a population of 78 million, Tamil Nadu is India’s 6th most populous state. It is the second largest economy in India, achieving a GSDP of US$270 billion in 2020. A key city is Chennai, the capital city of Tamil Nadu.
Despite the pandemic, the state has continued to attract investments of over US$1.2 billion in areas such as electric mobility, renewable energy, automotive and data centres in FY20/21. A new industrial policy was announced in early 2021 to provide further fillip to the state’s industrial growth.
The state has a diversified manufacturing sector in several industries such as automotive, pharmaceuticals, textiles, and leather products. Home to major MNCs such as Hyundai, Nissan, Daimler, and Samsung, it is commonly regarded as the automotive and electronics manufacturing hub of India. CapitaLand’s OneHub Chennai is one of several landing zones for Singapore manufacturers to set up operations.
Tamil Nadu continues to hold potential for Singapore in the infrastructure space, with capital city Chennai fast becoming India’s second major data centre hub after Mumbai, given its sound optic fibre network connectivity and undersea cable landing stations.
Tamil Nadu is a major export hub, recording US$26 billion worth of exports in 2020-21, contributing close to 9% of India’s net exports. Its position along the Chennai-Bengaluru Industrial Corridor and Vizag-Chennai Industrial Corridor, and linkages to consumption hubs make it a prominent hub for trade and commerce.
Chennai is also an up-and-coming startup hub and has built a reputation for itself as India’s Software as a Service (SaaS) capital. It is also home to two SaaS unicorns, Freshworks and Zoho. Investor and start-up activity in the state is expected to grow further with launch of the Startup and Innovation Policy in 2019, and the unveiling of its Blockchain Policy in 2020. Singapore startups such as CrayonData and Pellucid have set up offices in the state and are tapping on Tamil Nadu’s strong tech talent pool for their tech development and R&D needs.
Haryana is well-connected with access to 2 international airports, 5 domestic airports, 1,703 km of rail network and 26,131 km of road network including 34 national highways. The city’s proximity to a prominent trade and consumption centre in Delhi gave rise to the thriving presence of more than 250 Fortune 500 companies, majority of which are in the key districts of Gurugram, Faridabad, Karnal, Ambala, Panipat and Kurukshetra.
Agriculture contributes about 21% to the state’s GSDP and remains one of the biggest employment generators in the state. Rice, wheat, sugarcane, cotton, amongst other commodities are the key agricultural products of the state with strong potential for value addition and exports. In FY20, Haryana’s exports of major agricultural products amounted to US$2.3 billion.
The state is the largest producer of passenger vehicles and motorcycles in India, with the Gurugram-Manesar-Bawal belt being recognised as the auto hub of India. Japanese and Korean companies operating in Haryana include Suzuki, Toyota, Samsung, LG Electronics, amongst others.
Haryana has also emerged as a base for the knowledge industry, including IT outsourcing and software development. The state’s electronics and IT exports stood at US$7.2 billion during 2016-17, which is 6.2% of the total electronics and IT exports from India. Gurugram is the IT and Financial hub of Haryana.
According to the Department for Promotion of Industry and Internal Trade (DPIIT), cumulative FDI inflows in Haryana amounted to US$2.42 billion between October 2019 and March 2021. The services sector accounted for a major share in FDI followed by real estate. Strategic factors such as proximity to market and growth of manufacturing zones increasing make Haryana a choice location for logistic hubs and warehousing developments too.
The state currently offers a wide range of policy and fiscal incentives for businesses under the 2011 Industrial and Investment Policy It also has various sector specific policies, particularly for food processing, logistics, warehousing, retail, and startups, amongst others.
Ongoing developments in Haryana:
Gujarat is a highly industrialized state contributing 8% to India’s GDP, with a population of 63 million. In 2020, the state economy experienced a compounded annual growth rate of 9.8%. There has also been a growing investment into the state, accounting for 30% of total FDI in India in April 2020 to March 2021. Gujarat is fast emerging as a manufacturing and export hub of India, accounting for 20% of India’s total exports.
Gujarat is a leader in industrial sectors such as chemicals, petrochemicals, dairy, drugs and pharmaceuticals, cement, diamonds, renewable energy and agrofood processing. Major Indian business houses with headquarters in the state include the Adani Group, Amul, and Torrent Group. Ahmedabad is the largest city and the economic hub of Gujurat.
Petroleum hub of India The largest petroleum refineries by Reliance Industries and Essar Oil are situated in Jamnagar, Gujarat. Gujarat contributes to around 53% and 31% to the Indian crude oil and natural gas production respectively.
Renewable Energy Gujarat is ramping up its adoption of renewable energy capacity in the state with a total of more than US$100 billion of investments committed to solar and wind energy projects.
Highest number of ports in India With the longest coastline of 1,600 km, Gujarat has one major port and 41 non-major ports. The largest private sector port, Mundra Port, is also situated in Gujarat.
Robust Logistics Network Strategically located between Delhi and Mumbai, Gujarat is connected by a dedicated freight corridor, with nearly 560 km passing through the city. It is also ranked first in the country on the Logistics Ease Across Different States (LEADS) index released by Ministry of Commerce and Industry, India.
Gujarat International Financial Tec-City (GIFT City) Based in Ahmedabad, it is the country’s first International Financial Services Centre that can serve customers outside of India’s domestic economy and jurisdiction.
Ranked the 7th biggest economy in India with a GSDP of US$140 billion in 2020, Telangana is one of the fastest growing states in India, growing at a GSDP CAGR of 11.1% over the last five years. Despite being the youngest state in India, Telangana has successfully established itself as an economic powerhouse, attracting major multinational manufacturing companies such as Boeing, Lockheed Martin and Hyundai. A key city is Hyderabad, the capital city of Telangana.
Renowned for its vibrant tech landscape, Hyderabad is an IT hub hosting numerous global IT and ITES firms such as Microsoft, Apple and Amazon. The government of Telangana has also been actively nurturing the startup ecosystem in Hyderabad, becoming one of the first states to launch a startup policy to bridge the gap between startups and the government. It has also worked with academia and the private sector to establish T-Hub, India’s largest incubator for startups. Key innovation verticals include healthtech, software-as-a-service, urbantech and agritech.
There is a sizable and growing presence of Singapore companies in Telangana, including real estate and infrastructure players like CapitaLand and ST Telemedia, who have invested into IT parks and data centres in the state. Over the years, Singapore companies like Napier Healthcare and Web Synergies have also set up IT development centres within the state. DBS Group also operates its second technology operations hub outside of Singapore from DBS Asia Hub 2 in Hyderabad.
Hyderabad is also a key metro for the distribution of consumer goods, with IKEA choosing Hyderabad as its first India location. It is also growing as a logistics hub, due to its infrastructure, availability of land, skilled manpower, and position at the epicentre of India. Longer term opportunities for Singapore companies are expected as the state grows its manufacturing footprint.
The state is also a major centre for production and export of pharmaceuticals and is responsible for 33% of the global vaccine output and 40% of India’s total bulk drug output. Top pharmaceutical companies such as Aurobindo, Dr Reddy’s, Hetero, and Bharat Biotech are all headquartered in the city, and Singapore company Surbana Jurong has done the master planning for pharmaceutical clusters Genome Valley and Pharma City. There are growing opportunities for Singapore companies on this front, such as in the provision of decentralised solutions as well as supply chain solutions.
The state’s GSDP was approximately S$12 billion over the April 2020 to March 2021 period. Key sectors contributing to its GSDP include agriculture and allied sectors, food processing, biotechnology, bulk drugs and pharmaceuticals, chemicals and petrochemicals, energy, automotive and auto components, and information technology. The state’s key export commodities include marine products, drug formulations and biologicals, iron and steel, and rice. Notably, Andhra Pradesh state is India’s biggest producer and exporter of marine products including shrimp and fish varieties.
The Andhra Pradesh government has charted its path for the development of the state by identifying and developing policies focusing on specific subsectors including agriculture post-harvest processing and value addition, education and skills development, infrastructure (energy, transport, and communications), and urban development. Notably, the government also announced an AP Information Technology policy with the intent of developing IT-ready talent in the state. This entails the set-up of IT parks and Centres of Excellence, which the government has put schemes in place to support.
Visakhapatnam is the largest city as well as the industrial hub of Andhra Pradesh. It is also home to one of the largest cargo handling ports in India.
Singapore companies interested in exploring opportunities in Andhra Pradesh can approach SBF or ESG for more information.