Hyderabad: As global trade wars rage on, sending countries and companies scrambling to de-risk their global supply chains, Telangana is positioning itself as the answer to the world’s China+1 strategy across sectors, especially pharma & biotech and electronics manufacturing.
While Chief Minister A Revanth Reddy has been wooing companies at various industry forums to make Telangana their China+1 partner, this strategic pitch has now also made it to finance minister Bhatti Vikramarka Mallu’s budget speech on Wednesday.
“The industrial sector in Telangana provides employment to 22.5% of the workforce. By adopting the ‘China +1’ strategy, the govt aims to develop Telangana into a global manufacturing hub in key sectors such as pharmaceuticals, biotechnology, electric vehicles, and renewable energy,” Bhatti said.
“The development of industrial corridors and special economic zones (SEZs) will help attract more investments and create greater employment opportunities. This, in turn, will contribute to a more stable and rapidly growing economy,” Bhatti said.
The Telangana govt has already announced plans to establish greenfield pharma clusters between the Outer Ring Road (ORR) and the proposed Regional Ring Road (RRR). Bhatti said these clusters, equipped with world-class infrastructure, will be set up in Ranga Reddy and Mahbubnagar districts to enable pharmaceutical, biotech, and life sciences companies scale up operations, with the Pharma City serving as a dedicated hub for the production of antibiotics, synthetic drugs, vaccines, nutraceuticals, herbal medicines, and cosmetics-related products.
Telangana’s special chief secretary for industries, Jayesh Ranjan, said the state is positioning itself as a prime alternative destination for companies looking to diversify their manufacturing operations beyond China, in alignment with India’s broader China+1 strategy. This encompasses both domestic manufacturing scale-up and attracting international companies seeking to relocate from China.
Ranjan said Telangana’s China+1 strategy operates on two major fronts. The first aligns with ‘Atmanirbhar Bharat’, which focuses on reducing dependency on Chinese raw materials, particularly in sectors such as pharmaceuticals, biotech, and electronics. The second aspect targets companies with manufacturing facilities in China that are facing challenges due to geopolitical tensions and increasing tariffs, especially those exporting to the United States.
“Telangana is strategically identifying and approaching such companies, presenting itself as a viable alternative manufacturing destination,” he said, pointing out that companies relocating to Telangana can continue exporting to the US while avoiding Chinese tariffs and simultaneously access India’s vast domestic market.
Ranjan said this proposition is particularly attractive as US-China trade tensions make Chinese manufacturing less competitive due to heavy duties and restrictions. “We are conducting a detailed analysis of potential companies. We are studying their current operations in China, including wage costs, supply chain dynamics, and port access, to demonstrate how these operations can be executed more effectively in India,” he said, while refusing to divulge the names of companies but mentioned that the initiative is being pursued across sectors.
