Hyderabad, December 14: While a majority of city-based entrepreneurs feel that the development would have little or no impact on their businesses, there are some who think this could spell serious trouble for the city’s economy.
E Sudhir Reddy, chairman of infrastructure major IVRCL, believes that it would be business as usual once the dust settles on the Telangana issue. “I don’t see business taking a hit because of this crisis, as it’s more political in nature than anything else. Hyderabad would still retain all its advantages in terms of resources necessary to carry on business, even if it were to be a part of Telangana,” he opines.
A Mahindra Satyam spokesman said the company had not felt any impact of the Telangana agitation.
There is also a sentiment amongst the city’s entrepreneurs that creation of Telangana may actually boost business prospects in Hyderabad. The new government, which would assume charge in the region, is expected to be more commerce-friendly to attract investment. “The new government may actually be more liberal in terms of business policies in order to assure industry about its pro-market credentials,” Arun Kumar Dukkipati, president of AGI glaspac — a city-based glassware major, believes. “Still, regaining the trust of the business community may not be easy,” he says.
Indeed, reassuring the business world about a healthy environment, which would foster growth, may have to be the top priority for the new regime that takes charge in Telangana. Business confidence amongst city-based entrepreneurs took a severe beating during the prolonged spell of violence and the several ‘bandhs’ that were witnessed in the two-week campaign to carve out a separate state.
“Hyderabad lost close to Rs 100 crore a day during the forced shutdowns in the past couple of weeks. Small-scale industries and traders were the worst sufferers. The events have left a deep scar on the psyche of the business community. It would take a long time to heal,” Harishchandra Prasad, president of Federation of Andhra Pradesh Chambers of Commerce and Industry, said.
There’s also speculation that the long period of unrest may affect the stock market prospects of some of the Hyderabad-based companies. “Clearly business will be affected until unrest in the region settles down after a concrete decision is taken on the Telangana issue. From a market perspective, there could be some selling in stocks of companies that have stakes in the region,” said Raamdeo Agrawal, director of Motilal Oswal Financial Services.
The real estate sector is also expected to suffer badly in case Hyderabad becomes a part of Telangana. “Property prices are sure to come crashing down if it happens,” a realtor told Financial Chronicle.
“We are facing problems there and the business is down. We could not open many of our branches there, especially in places such as Guntur and Anantapur,” said CJ George, managing director of Geojit BNP Paribas Financial Services.
-Agencies