New Delhi: The Uttar Pradesh Global Investors’ Summit 2023 came to a close Sunday, fetching close to Rs 35.5 lakh crore in proposed investments — double the revised target of Rs 17.3 lakh crore — with the total number of MoUs (Memorandum of Understanding) exceeding 19,000.
Among the total number of LOIs (letters of intent), more than 17,000 were issued by entities in the Rs 0-100 crore category, in addition to the 203 commitments made by entities in the Rs 2,000 crore and above category, according to data released by the UP government.
A ‘letter of intent’ is a preliminary document sealing a partnership between two interested parties over an investment. This is followed by due diligence after which both parties negotiate a purchase agreement to actualise the deal.
The renewable energy sector bagged the highest investment, raking in an estimated Rs 4.4 lakh crore through 144 LOIs — close to 15 per cent of the total number of investments. The electronics manufacturing sector came in second with 151 LOIs worth an estimated Rs 3.5 lakh crore.
Experts believe the inclination among investors towards the renewable energy sector is no surprise owing to the need for states to align themselves with the central government’s push for domestic manufacturing businesses.
With over 7,000 LOIs, the manufacturing sector received the most number of commitments, followed by textiles and dairy with a combined kitty of a little over 1,000 LOIs. In comparison, the power generation sector bagged six commitments worth an estimated Rs 53,000 crore.
With a total of 16 MoUs in sectors like manufacturing, electronics, textiles, EV and medical devices, Hong Kong’s Tauschen Groups of Companies was the most promising investor at the summit. The conglomerate pledged to invest close to Rs 1.8 lakh crore in Noida, Mirzapur, Agra, Lucknow and Varanasi.
RG Strategies group was the second largest investor at the summit, signing seven MoUs worth close to Rs 1.7 lakh crore in sectors like renewable energy, EV and manufacturing. The company is likely to set up bases in Bulandshahr, Gorakhpur, Noida and Ghaziabad.
This was followed by Imperia Innovation Investment (Austin Consulting Group), a US-based venture capital firm, which signed two MoUs in the education and infrastructure sectors worth close to Rs 1.5 lakh crore. Lakhimpur Kheri and Noida are its preferred locations for business. The Austin Consulting Group was embroiled in a controversy last December after which the UP government had to issue a clarification regarding an MoU worth $42 billion it signed with the group to build a Knowledge Smart City.
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Push for renewable energy at Global Investors’ Summit
Vibhuti Garg, director (South Asia) for Cleveland-based Institute for Energy Economics and Financial Analysis (IEEFA) told ThePrint, “I would say renewable energy is the future and there is a big scope given that the government now wants to give emphasis on domestic manufacturing.”
Garg explained that in addition to renewable energy being looked at from the generational perspective, the “entire value chain is being looked at as a prospect for creating more green jobs in the country”.
“And also from the energy security perspective, we want to reduce reliance on imports because so far we were importing more than 80 per cent of the modules from China, but now, through the PLI (production-linked incentive) schemes, the government is trying to give a boost to domestic manufacturing and states can play a big role. And I think that’s where UP wants to invite more and more investment,” she added.
Another perspective revolves around India’s revised ‘Nationally Determined Contribution’ (NDC) for the United Nations Framework Convention on Climate Change (UNFCCC).
According to Binit Das, deputy programme manager for renewable energy at Delhi-based think tank Centre for Science and Environment (CSE), the “recent push towards renewable energy sector investments is mainly attributed to India’s revised NDCs, which broadly represent India’s framework for its energy transition for 2021-2030”.
“By 2030, the country has committed to generating 50 per cent of its total installed electrical power from non-fossil fuel-based energy resources (renewable energy, including hydropower),” he said.
However, Das also said that achieving these targets is a “considerable challenge” given the restrictions companies face in capacity building. “It is a considerable challenge to achieve the goal of 450 GW (gigawatt) of renewable energy by 2030, given that we lack an indigenous manufacturing capacity for renewable energy components,” he added.
Region-wise breakup
Among the different regions in Uttar Pradesh, western UP locked 45 per cent of the total investments in the run-up to and during the Global Investors’ Summit 2023. From this region, Gautam Buddha Nagar, Agra, Ghaziabad, Shahjahanpur and Bareilly are expected to receive investments worth approximately Rs 12 lakh crore.
Next was eastern UP — which comprises both PM Narendra Modi’s and UP CM Yogi Adityanath’s Lok Sabha constituencies, Varanasi and Gorakhpur respectively — with 29 per cent, followed by 13 per cent each for Bundelkhand and central UP. Varanasi locked in close to Rs 1.3 lakh crore in investment proposals, almost 4.75 per cent of the total. Gorakhpur, on the other hand, got 328 LOIs and investment proposals worth nearly Rs 1.7 lakh crore.
Among the districts, Gautam Buddha Nagar — which comprises Noida, among other cities — received the most number of investments, bagging 27.16 per cent of the total commitments. This was the second consecutive year that Gautam Buddha Nagar saw the highest number of investments. Agra, Lucknow and Gorakhpur followed with 7.5 per cent, 6.7 per cent and 5.9 per cent respectively.
The three-day Global Investors’ Summit 2023 was held in Lucknow from 10-12 February. The event concluded Sunday with an address by President Droupadi Murmu who said UP is “saksham (capable) and taiyyar (ready)” to “play the role of India’s growth engine”.
(Edited by Amrtansh Arora)
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