How Andhra is carving itself out as a major defence hub amid stiff southern competition
With the launch of several defence projects last week, Andhra Pradesh is marching ahead, leaving the southern legacy hubs behind
In the race among the South Indian states to secure defence and aerospace projects, Andhra Pradesh has emerged as the clear winner in recent times. It is emerging as a major hub for these projects, leaving legacy hubs like Karnataka and Tamil Nadu behind.
Also read: Tamil Nadu loses AMCA defence testing hub to Andhra despite Hosur infra edge
Neighbours vs Andhra
Andhra has bagged several defence projects under its so-called ‘double engine' government. The ruling Telugu Desam Party (TDP) in the state is an ally of the BJP and is part of the National Democratic Alliance (NDA).
On the other hand, Karnataka, particularly Bengaluru, has historically held a dominant 65 per cent share of India’s aerospace and defence sector. However, severe land acquisition bottlenecks and high infrastructure costs in Bengaluru have opened a window for Andhra.
Last year, the Andhra and Karnataka governments were locked in a battle over a proposed aerospace park. Andhra IT Minister Nara Lokesh invited the aerospace industry to come to the state after the Karnataka government scrapped the acquisition of 1,777 acres of land in Devanahalli in the face of farmers' protests.
He offered 8,000 acres of ready-to-use land outside Karnataka’s capital, Bengaluru.
Also read: Google AI data centre in Andhra to act as growth engine for India: CM Naidu
More recently, the Fifth-Generation Advanced Medium Combat Aircraft (AMCA) project was launched in Andhra Pradesh, as Tamil Nadu missed out.
Tamil Nadu too had engaged in discussions with the Defence Research and Development Organisation (DRDO) for the past three years to bring the AMCA project to Hosur.
Rajnath launches projects
On May 15, Singh and Andhra Pradesh Chief Minister N Chandrababu Naidu laid the foundation stones and presided over the ground-breaking ceremonies for a range of strategic aerospace and defence projects.
Rather than securing standalone factories, Andhra Pradesh’s Aerospace and Defence Policy 4.0 (2025–2030) focuses on interconnected manufacturing corridors that rival existing regional hubs.
Therefore, foundation stones were laid for the Core Integration & Flight Testing Centre at Puttaparthi to fast-track the development of the AMCA and other future indigenous platforms, and the Naval Systems Manufacturing Facility at T Sirasapalli village in Anakapalli district near Visakhapatnam to cater to the requirements of advanced underwater weapons and naval combat systems.
The ground-breaking ceremonies were carried out for the Defence Energetics Facility and the Ammunition and Electric Fuses Plant at Madakasira in Sri Satya Sai District.
In addition, a consortium of eight drone companies has joined forces to establish a Drone City in Kurnool. Various companies also exchanged MoUs with the government of Andhra Pradesh to establish defence units in the state.
AMCA programme at Rs 15,000 crore
Singh said Andhra Pradesh is poised to become a major hub for aerospace and defence manufacturing.
The total outlay for the AMCA programme is around Rs 15,000 crore, and the Core Integration & Flight Testing Centre of Aeronautical Development Agency, an affiliate organisation of DRDO, is a vital component of the project. The facility is being established at a cost of approximately Rs 2,000 crore.
The Naval Systems Manufacturing Facility, a Rs 480 crore project of Bharat Dynamics Limited (BDL), will focus on autonomous underwater vehicles, underwater counter-measure systems, and next-generation torpedoes. It will manufacture several critical components and sub-systems that the nation has, until now, been importing from abroad.
The Defence Energetics Facility of Agneyastra Energetics Limited, a subsidiary of Bharat Forge Limited, is being set-up with an investment of Rs 1,500 crore.
The Ammunition and Electric Fuse Plant of HFCL Limited is being established with an investment of around Rs 1,200 crore.
Naidu: Andhra will emerge as India’s ‘defence shield’
While legacy hubs like Karnataka and Tamil Nadu retain deep-rooted talent pools, technical expertise, and an accumulation of existing defence PSUs, Andhra is winning the battle for new, large-scale greenfield investments.
Its core strength lies in its unmatched land availability, rapid regulatory speed, and strategic coastal access. While Karnataka dominates in research and development and Tamil Nadu excels in precision component manufacturing, Andhra has successfully positioned itself as the premier destination for massive, space-intensive greenfield projects.
Unlike its neighbours, which face severe land bottlenecks and high real estate costs around cities like Bengaluru and Chennai, Andhra offers vast, flat, and contiguous land parcels. The state has dedicated large swathes of low-cost land in the Rayalaseema region specifically for explosive manufacturing, missile testing, and drone tracks that require wide safety buffers.
By utilizing its geographic proximity to Bengaluru, offering vast maritime testing grounds, and executing rapid regulatory turnarounds, the state has turned competitive federalism to its distinct advantage.
Last week, Chief Minister Naidu called upon the industries and entrepreneurs to “Design-in-Andhra Pradesh, Make-in-Andhra Pradesh, lead-from-Andhra Pradesh”, extending the state government’s full cooperation. Naidu said Andhra Pradesh will emerge as the “defence shield” of the country with the emergence of defence manufacturing and aerospace facilities.