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Telangana Wins Kitex Investment, Kerala Loses Sabu Jacob

Kitex Garments Managing Director Sabu M Jacob had withdrawn his plan to invest Rs 3,500 crore in Kerala this week.

Updated
India
3 min read
<div class="paragraphs"><p>Kerala businessman and Kitex Managing Director Sabu Jacob.</p></div>
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Sabu M Jacob, managing director of Ernakulam based Kitex Group announced on Friday, 9 July that his company will make a phase-I investment of Rs 1,000 crore in Telangana. The investment will be made over a span of two years, Jacob in a media release, said.

The investment will be made in 'textile apparel' in Kakatiya Mega Textile Park in Warangal. The investment is expected to generate 4,000 jobs in the state.

Earlier in the day, Jacob had addressed a media conference in Kochi accusing Pinarayi Vijayan-led Left Democratic Front government of houding him.

He is being forced to withdraw from his investment plan in Kerala because he is being 'thrown out', Jacob told the press.

Jacob will not be investing Rs 3,500 towards a garments park in Kochi. His establishments had faced 11 inspections in May alone, Jacob accused.

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Telangana's minister for industries, K Taraka Rama Rao had presented the Kitex group with "an overview of the progressive investment policies of the state government and also the availablity of various resources for textile industry". Telangana cotton is one of the finest in the world, Rao impressed upon the Kitex team, his office explained in a media release.

"The minister also explained TSIPASS single window clearance system and other advantages that Telangana offers," the release read.

'Kerala Not Industry Friendly, Telangana Offered Incentives'

Ever since he expressed displeasure with the Kerala government, nine other state governments including Tamil Nadu and Telangana have been wooing Jacob, he said. On Friday, 9 July, Jacob was flown to Telangana in a chartered jet arrangement by the state government.

Telangana has offered him incentives to set up a garment unit in the state, Jacob said.

In Hyderabad, Jacob held a three-hour-long meeting with Telangana industries minister K T Rama Rao. He was then taken in a chopper to Warangal's Kakatiya Textiles Mega Park.

A second round of meeting was held in Hyderabad on his return to the city. "He was very pleased with our offers," a senior Telangana state government officer told The Quint.

In Kerala, however, Jacob had minced no words to express his displeasure at the LDF government. "We have been doing business in Kerala for the past 53 years. The world has changed, but Kerala is still 50 years behind," he said, adding, he feels worried about Kerala's young generation as there "are no jobs in the state for them".

Around 6.1 million Keralites are working in other states and foreign countries because of unemployment in Kerala, he alleged.

Kitex is the second largest children's garments manufacturer in the world.

The fallout between Jacob and Kerala government happened because he started a political party – 'Twenty Twenty' – in the state. He had earlier adopted a village, Kizakambalam, in Ernakulam district.

The party contested in six seats in Assembly elections which was held this year. While the party did not win any seats, it still poses a threat to both Congress and the ruling Communist Party of India (Marxist) in local bodies.

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'Kerala Government Ready to Hold Talks': Minister

"An investor seeks peace of mind and I did not get this in my home state," Jacob said in Kochi, adding he is being "driven out of the state". After he decided to leave Kerala, Kerala government did not try to retain him in the state, he alleged. "I got calls from other states," he said.

Meanwhile, P Rajeev, industries minister of Kerala said that the state has not initiated any inquiry into the operations of Kitex garments. Inspections were held at Kitex's facilities because several complaints had reached the State Human Rights Commissions about mismanagement of workers, he said.

Kerala government is ready for talks with Jacob, if he wishes to do so, Rajeev said at a media conference. Kerala Chief Minister Pinarayi Vijayan had said earlier said that, "Kerala is an investment friendly state".

(At The Quint, we are answerable only to our audience. Play an active role in shaping our journalism by becoming a member. Because the truth is worth it.)

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