Cognizant will invest ₹1,582.98 crore to establish a world-class IT/ITeS campus in Visakhapatnam. It is projected to create 8,000 jobs by 2033.
Published Jun 20, 2025 | 4:10 PM ⚊ Updated Jun 20, 2025 | 4:21 PM
Synopsis: The government claimed the move to provide land at 99 paisa an acre works as a catalyst for economic growth. While critics alleged a lack of transparency and violations of land allocation norms, a similar allotment was made to TCS as well earlier this year.
Telugu Desam Party (TDP)-led Andhra Pradesh government has decided to allot 21.31 acres of land to Cognizant almost free, to transform Visakhapatnam into a global IT destination.
The allotment of land at the rate of 99 paisa per acre, announced on Friday, 20 June, follows similar deals with Tata Consultancy Services (TCS) and Ursa Clusters Private Limited. The state, led by Chandrababu Naidu, has been aggressively pursuing measures to attract investments.
While the government claims these moves work as catalysts for economic growth, critics allege a lack of transparency, potential favoritism, and violations of land allocation norms, particularly in the Ursa deal.
Cognizant’s ₹1,582.98 crore investment to establish a world-class IT/ITeS campus in Visakhapatnam, under the Visakhapatnam Metropolitan Region Development Authority (VMRDA), is projected to create 8,000 jobs by 2033.
The 21.31-acre allocation at Kapuluppada, leased at 99 paisa per acre, aligns with the state’s blueprint to replicate Hyderabad’s HITEC City.
IT Minister Nara Lokesh, who has been spearheading investment drives, had hinted at Cognizant’s interest in making investments in Andhra Pradesh as early as January 2025. He made a request to Cognizant CEO S Ravi Kumar during his visit to Davos for the World Economic Forum.
After the meeting Lokesh said on X: Had a terrific meeting with @imravikumars, CEO of technology giant @Cognizant. GOOD NEWs COMING SOON. STAY TUNED.”
The project, 100% self-funded, underscores Cognizant’s long-term commitment to Andhra Pradesh, a state increasingly seen as an IT powerhouse.
However, the nominal pricing has raised eyebrows, mirroring concerns from earlier allocations to TCS and Ursa. Critics argue that land worth approximately ₹1,000 crore is being handed over at a fraction of its market value, prompting questions about fairness and adherence to regulations.
TCS, India’s largest IT services company, received 21.16 acres at IT Hill Number 3 in Visakhapatnam in April 2025, also at 99 paisa per acre. With a planned investment of ₹1,370 crore, TCS aims to create 12,000 jobs, starting operations within 90 days and completing a permanent campus for 10,000 employees within 2-3 years. The deal was finalized during Lokesh’s October 2024 visit to Tata Group’s Mumbai headquarters.
TCS has a strong presence in Andhra Pradesh, with existing facilities in Hyderabad and a history of delivering large-scale IT projects. Its commitment to Visakhapatnam is in tune with its expansion strategy in tier-2 cities, leveraging lower operational costs and government incentives. The company’s financial stability and proven job creation record make it a low-risk partner for the state, unlike lesser-known entities.
Despite TCS’s credibility, the allocation has drawn scrutiny. A former bureaucrat, EAS Sarma, in his letter to AP Chief Secretary K Vijayanand on 17 April, said that the 99-paisa rate violates Government Order (G.O.) Ms 571 (September 14, 2012), which mandates leases at 10% of the market rate, renewable triennially.
With the land’s market value estimated at ₹1,000 crore, critics argue the deal shortchanges public resources. The YSR Congress Party (YSRCP) has labeled it part of a “land scam,” though evidence of impropriety specific to TCS do not seem to exist. Demands for transparency, particularly on local job guarantees, originate from past instances where companies failed to deliver promised employment after securing subsidised land.
The allotment of 59.86 acres to Ursa Clusters Private Limited on 10 April 2025, for an AI Data Centre at Kapuluppada (56.36 acres) and IT Park (3.5 acres) sparked a raging controversy. Ursa, incorporated in India in February 2025 with a paid-up capital of ₹9.1 lakh, promises a ₹5,728 crore investment and 2,500 jobs. However, its obscure background and alleged political ties have fueled accusations of favoritism.
The Ursa deal has been labelled “land grabbing” by the CPI(M), which estimates the 59.86 acres to be worth ₹3,000 crore. Critics question why an untested company received nearly three times the land allotted to TCS, a global leader. The YSRCP alleges that Chief Minister N Chandrababu Naidu’s State Investment Promotion Board (SIPB) fast-tracked the allocation without due diligence. The CPI(M) demanded the cancellation of the deal, citing a lack of transparency and public accountability.
The TDP government, led by Naidu, defends the allocations as strategic incentives modeled on Gujarat’s 2008 Tata Motors deal, where land at 99 paisa per acre catalyzed industrial growth. Since July 2024, the SIPB has approved projects worth ₹5.34 lakh crore, targeting 4.73 lakh jobs. The Cognizant and TCS deals, with their 20,000 combined job projections, are seen as anchors for Visakhapatnam’s proposed 500-acre Data City. The government argues that nominal pricing is a standard practice to attract global players, citing Hyderabad’s IT boom as a precedent.
Andhra Pradesh’s land allocations to Cognizant, TCS, and Ursa reflect an ambitious bid to elevate Visakhapatnam as an IT hub but are marred by controversy. While Cognizant and TCS bring credible investment, the Ursa deal’s opacity and alleged favoritism fuelled accusations of a land scam.
(Edited by Majnu Babu).
