Andhra Pradesh is emerging as a key player in India’s IT sector, and Chief Minister Chandrababu Naidu is leading the charge with aggressive investments and strategic partnerships. In a bold move to attract global IT giants, the state government has offered prime land in Visakhapatnam to Cognizant for a token price of 99 paise. This landmark deal aims to transform Vizag into the next big IT hub of India.
This development comes just months after a similar agreement with Tata Consultancy Services (TCS), reinforcing the state’s commitment to boosting employment and infrastructure growth.
Let’s decode the full details, the government’s vision, and why this move matters for India’s tech ecosystem.
Cognizant’s ₹1,582 Crore Investment Deal: Key Highlights
- Company: Cognizant Technology Solutions
- Headquarters: Teaneck, New Jersey, USA
- Land Allocation: 21+ acres in Visakhapatnam
- Lease Amount: ₹0.99 (99 paise)
- Total Investment: ₹1,582 crore
- Jobs Creation Target: 8,000 jobs
- Expected Operations Start: March 2029
According to CNBC reports, the proposed IT campus will be located at a strategic point—600 km from Hyderabad and 800 km from Chennai, placing Visakhapatnam in the heart of India’s IT growth corridor alongside Bengaluru, Hyderabad, and Chennai.
Why Visakhapatnam? Government’s Strategic Vision
The man behind Andhra Pradesh’s IT vision is Nara Lokesh, the state’s Minister for Technology and Chandrababu Naidu’s son. Speaking to media earlier this year, Lokesh made his vision clear:
“If Goa were to marry Bangalore and have a child, that could be Visakhapatnam. We have it all, and we believe that this could be the trigger for larger investments coming to Visakhapatnam.”
Visakhapatnam, or Vizag, has long been seen as an emerging coastal hub with massive untapped potential. With pristine beaches, upcoming port development, and an expanding urban infrastructure, Vizag offers the perfect balance of lifestyle and business opportunities.
The government’s goal is simple: Make Vizag the next IT magnet by offering incentives, infrastructure, and partnerships with tech giants.
Similar Mega Deal with TCS
This deal with Cognizant is not the first of its kind. In April 2025, the Andhra Pradesh Cabinet approved the allocation of 21.16 acres of land to Tata Consultancy Services (TCS) in Visakhapatnam, again for a token lease price of 99 paise.
TCS Deal at a Glance:
- Company: Tata Consultancy Services (TCS)
- Land Area: 21.16 acres at IT Hill Number 3, Visakhapatnam
- Investment Amount: ₹1,370 crore
- Expected Jobs Creation: 12,000 jobs
- Purpose: Establishment of a large IT campus
By striking deals with both Indian and multinational IT companies, the Andhra Pradesh government is playing a dual strategy: leveraging domestic giants like TCS and global MNCs like Cognizant to diversify and strengthen the region’s IT presence.
Other Key Land Allocation Approvals
It’s not just IT that’s getting a push. The Andhra Pradesh government has approved several other major projects:
- Mahamaya Industries Limited: Approved proposal to expand its steel plant in Vizianagaram.
- Employees’ State Insurance Corporation (ESIC): Allocation of 6.35 acres in Nadimpalem, Guntur district for the establishment of a 100-bed hospital with residential quarters for employees—either free or at nominal cost.
These decisions clearly indicate that Andhra Pradesh is focusing not just on technology but also on healthcare and manufacturing to build a robust state economy.
Why 99 Paise? The Logic Behind Token Lease
Critics often raise eyebrows at such nominal land deals, wondering how giving away prime land benefits the state. Here’s why token leases make sense in the long run:
- Long-Term Job Creation: ₹1,582 crore investment for 8,000 jobs = major employment boost.
- Infrastructure Development: Large campuses demand roads, transport, housing, boosting ancillary industries.
- IT Ecosystem Creation: Presence of major IT firms attracts smaller startups, training institutes, and investors.
- Tax Revenue: Corporate tax, personal income tax from employees, and GST from surrounding business ecosystems flow back to the government.
- Branding for Vizag: Positions Visakhapatnam alongside IT leaders like Bengaluru, Hyderabad, Pune, and Chennai.
In short: upfront nominal cost, long-term economic windfall.
Criticisms and Concerns
While the vision seems promising, opposition parties and some analysts have questioned:
- Why not auction the land to maximize immediate revenue?
- What guarantees are in place to ensure companies don’t abandon midway?
- Environmental concerns with large IT parks near coastal regions.
To address these concerns, robust contractual obligations and compliance clauses are expected in these deals. Monitoring agencies and independent audits could further safeguard public interest.
Andhra Pradesh’s IT Growth Strategy: A Game Plan
Chandrababu Naidu has a long history of transforming Hyderabad into Cyberabad during his previous tenure. His approach now with Vizag seems like History 2.0.
The government’s three-pillar growth plan for IT seems to be:
- Strategic Land Allocations: Providing prime land at token rates to anchor companies.
- Infrastructure Upgrades: Ports, roads, fiber optic connectivity, urban modernization.
- Talent Development: Partnerships with tech education providers to ensure skilled workforce availability for upcoming campuses.
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