The ugly controversy that broke out between Kitex Group, the textile major and the Kerala government has ended with Telangana reportedly whisking away the investor on their private jet to their state.
Kerala’s loss will be Telangana’s gain, it seems. As Sabu Jacob, the MD of textile major Kitex Group, left Kochi along with a five-member team on board a Telangana private jet, he said with a “heavy heart” that he was not leaving Kerala out of his own volition but he was being “kicked out” by the government, said a report by Hindustan Times.
Jacob added that while Kerala claimed that it was one of the best investor-friendly states, the ground situation was entirely different. The state’s policies were at least 50-year-old and they needed to change, he said.
The Kitex Group has reportedly announced the shifting of its proposed ₹3,500 crore project from Kerala to Telangana, the report added. Tamil Nadu and Karnataka too had evinced interest in the project after the textile group had alleged a “witch-hunt” against them. However, Telangana, beat them to it with industry minister K T Rama Rao already wrapping up one round of discussions with Jacob and dispatching a jet to Kochi to bring him to Telangana.
Quoting Jacob, the Indian Express reported that Telangana has offered them excellent facilities and support for their project. Telangana had invited them following their announcement to cancel the apparel project in Kerala, said Jacob. Kitex Garments had reportedly had plans to open three apparel parks in Kochi, Thiruvananthapuram, and Palakkad and would have generated jobs for at least 35,000 people.
Kitex’s announcement that they were relocating their project to Telangana comes after a series of inspections and raids on their garment manufacturing/processing units in Kerala by various government departments. In the last six months, there have been 11 raids by departments, said the IE report. Tired of the continuous harassment, Jacob said that the government treats them like “bourgeoises, exploiter capitalists, and land encroachers”.
“Enough is enough,” he said.
Jacob is also bitter that nobody from the Kerala government had contacted him even after he had gone public with his grievances. According to the textile exporter, “Industry minister P Rajeev was busy blaming me. Kerala has to learn many lessons from its neighbours. Otherwise, it will become a graveyard of industries.”
Further, he added that though the Chief Minister Pinayari Vijayan wanted to change the situation, he was not able to. Meanwhile, the industries minister, Rajeev alternated between railing against Kitex for spoiling the state’s image and promising to sort out the issues of the company.
Rajeev also told the media that no government department had suo motu gone for inspection to the existing Kitex manufacturing units. “The Kitex management could have taken up their woes with the government. Instead, they have been criticising the government on social media, only to tarnish it,” the minister said, reported the media.
Meanwhile, CM Pinarayi Vijayan had sought to allay the fears of industrialists by stating that Kerala is one of the most investor friendly states. And, he also thanked Harsh Goenka, who had rushed to the state’s support, to tweet that his company, RPG Enterprises, was the largest employer in Kerala and they find the local government very supportive.
However, as a Deccan Herald report pointed out, Kerala ranks 28th in the Ease of doing Business rankings issued every year by the Centre. Though the state government has claimed to have initiated measures such as the single window clearance for investors, Kerala has been lagging behind in these rankings.
The DH report quoted Kochouseph Chittilappilly, founder and chairman emeritus of Kerala based V-Guard industries, who echoed the view that though the government has initiated measures, the ground realities remained unchanged. Chittilappilly too has shifted some of his units out of Kerala and said that only a strong political leadership could curb labour militancy that was one of stumbling blocks in doing business in Kerala.
The second challenge being the involvement of multiple government agencies in giving sanctions to business units.
Media reports suggested that Jacob had got into the bad books of major political parties in the state after floating an independent party called Twenty20 in 2015, which has been contesting local body elections and holds power in Kizhakkambalam panchayat in Ernakulam, where its units are housed. In 2020, Twenty20 had retained Kizhakkambalam and won three other nearby panchayats.