Invest Kerala Global Summit 2025: Key Insights and Strategic Opportunities

India has emerged as a prime investment destination, driven by its robust economic growth and favorable business environment. The country has attracted over $1 trillion in cumulative foreign direct investment (FDI) inflows, with significant funding from countries like Singapore and Mauritius. In FY 2023, Maharashtra led with $14.80 billion in investments, followed by Karnataka, Gujarat, Tamil Nadu, Haryana, and Telangana, which are also gaining traction. Government initiatives such as the Production Linked Incentive (PLI) scheme and the National Single-Window System (NSWS) have strengthened the investment climate, attracting FDI in key sectors such as computer software, hardware, services, and pharmaceuticals. States actively compete for investments through targeted incentives and dedicated agencies; for instance, Vibrant Gujarat Summit, Guidance Tamil Nadu, and Maharashtra Industrial Development Corporation facilitate investor support, while Karnataka leverages its IT and startup ecosystem. Uttar Pradesh secured $400 million in investment proposals through its Global Investors Summit, while Telangana, Andhra Pradesh, and Odisha focus on ease of doing business and industry-specific incentives. National programs like Make in India and PLI continue enhancing India’s appeal as a global investment hub.

Kerala has also emerged as a flourishing center for IT, ITeS, AI, and Global Capability Centers (GCCs). Kerala is home to Technopark in Thiruvananthapuram, Asia’s largest green IT park, spanning 12.72 million sq. ft. with over 479 companies and 72,000 professionals. Infopark in Kochi and Cyberpark in Kozhikode further strengthen Kerala’s IT landscape, housing global players, including IBM, HCLTech, Tata Elxsi, Nissan Digital, and Wipro. Kerala’s IT workforce has grown exponentially, reaching over 250,000 professionals, driven by a strong education system and government-backed skill development programs. Kerala has prioritized emerging technologies such as AI, robotics, and 5G-enabled infrastructure, fostering innovation through institutions like IIITM-K and initiatives such as the Kerala Fiber Optic Network (K-FON), which ensures high-speed connectivity across the state. The presence of a growing GCC sector, with companies like SunTec, Envestnet, and Safran setting up operations, highlights the state’s attractiveness for IT-driven businesses. Kerala’s startup ecosystem is also flourishing, supported by Kerala Startup Mission, incubators, and accelerators. To support the above business and technology needs, Kerala has developed strong human capital initiatives through institutions such as the Digital University of Kerala (DUK), India’s first digital university that fosters talent in emerging digital technologies. Kerala is also home to Centers of Excellence (CoEs) such as the Kerala Blockchain Academy (KBA), which promotes blockchain innovation across key sectors including healthcare, banking, finance, and supply chain management. Additionally, the Information and Communication Technology Academy of Kerala (ICTAK) enhances student employability through specialized training, while the International Centre for Free and Open Source Software (ICFOSS) nurtures open-source technology talent. These initiatives ensure a skilled workforce, reinforcing Kerala’s position as a hub for technology-driven industries and global enterprises.

During our recent visit to the Invest Kerala Global Summit 2025, Honorable Chief Minister of Kerala, Shri Pinarayi Vijayan, along with Shri P. Rajeev, Minister for Law, Industries, and Coir, Shri APM Mohammed Hanish IAS, Principal Secretary of Industries & Commerce, and Shri Anoop Ambika, CEO of Kerala Startup Mission, among other distinguished leaders, highlighted Kerala’s strategic advantages as an investment destination. Through plenary sessions, panel discussions, and roundtable meetings over two days, they showcased the state’s business-friendly policies, thriving startup ecosystem, and sectoral growth opportunities. They emphasized that Kerala boasts a well-developed infrastructure, a highly skilled workforce, and a well-structured investment environment. The state has India’s first deep-water transshipment terminal at Vizhinjam, located 10 nautical miles from key international shipping routes, serving as a logistics hub for global trade. The Kochi-Bengaluru Industrial Corridor includes Integrated Manufacturing Clusters (IMCs) across 1,710 acres in Palakkad and 358 acres in Ayyampuzha. This corridor is expected to create over 55,000 jobs and attract investments in food processing, textiles, electronics, and logistics. Kerala’s connectivity is supported by four operational international airports (with a fifth planned in Kottayam), 2,106 km of railways, and 11 national highways covering 1,200 km. The state’s high literacy rate, digital initiatives, and policies supporting MSMEs facilitate external investments. Industrial growth is supported by policies such as the Kerala Industrial Policy 2023, a Logistics Park Policy, and an Export Policy, which aim to streamline investment processes. Strong connectivity, an expanding port network, and an evolving industrial base contribute to Kerala’s role as a center for economic activity.

During the IT Analysts’ Round Table, presided over by Shri Pinarayi Vijayan and Shri P. Rajeev and moderated by Ms. Suja Chandy, chief sustainability officer and managing director at Zafin India, the panelists focused on positioning Kerala as a key IT and GCC destination. The session emphasized sharing insights from existing investors on their experiences and interest in expanding GCCs in the region. The leadership was particularly keen to hear perspectives from Avasant and other analyst firms on strategies to enhance Kerala’s attractiveness for GCC investments. Our recommendations centered on the need for an industry-specific focus to differentiate Kerala in the GCC space. We highlighted from successful examples how Bengaluru and Hyderabad have established strong healthcare and life sciences-focused GCCs, while Ahmedabad has positioned itself as a hub for finance and fintech. The next steps for Kerala involve developing sector-aligned infrastructure, attracting visionary leadership to drive GCC growth, and cultivating a skilled talent pipeline to support long-term sustainability. The Pioneering Innovation in Global Capability Centers: Insights and Success Stories report by Avasant highlights the rapid expansion of GCCs in India, with an average of over 60 new centers established annually until 2024. Despite this growth, only 33% of Fortune 500 companies currently operate a GCC in India, indicating significant untapped potential. The median head count for GCCs stands at approximately 400 employees, with only 5% of centers employing more than 5,000 professionals. Additionally, since 2019, the salary gap between GCCs and service providers has doubled, reflecting the increasing competition for skilled talent. Currently, 12% of GCC workloads are outsourced to service providers, showcasing a hybrid operational model that balances in-house capabilities with external expertise.

Aligning the above elements effectively will be key to establishing Kerala as a preferred destination for global enterprises looking to set up and expand their GCC operations.

Finally, the state leadership emphasized that Kerala has established its Quality of Life (QoL) Ecosystem as a key factor in attracting businesses and top-tier talent, acknowledging that QoL significantly influences investment decisions. The state has India’s highest Human Development Index (HDI) at 0.752, well above the national average of 0.633, reflecting superior healthcare, education, and social welfare. With an Air Quality Index (AQI) of 26, significantly lower than the 100+ AQI levels in major metropolitan cities, Kerala offers a clean and sustainable environment. Additionally, the state has the highest literacy rate at 94%, with female literacy at 92.07%, showcasing its commitment to education and empowerment. These factors contribute to a higher Physical Quality of Life Index (PQLI) than national benchmarks, reinforcing Kerala’s reputation as a desirable location for professionals and businesses. For enterprises, Kerala’s strong QoL metrics translate into a highly skilled and productive workforce, lower attrition rates, and a conducive environment for innovation and long-term growth. The state’s emphasis on work-life balance, quality healthcare, and progressive social policies enhances its attractiveness for both domestic and global investors. As businesses increasingly prioritize employee well-being and sustainability, Kerala’s investment in human capital and infrastructure makes it a compelling choice for establishing operations.

Analysis

Here are some of the key takeaways from the Invest Kerala Global Summit 2025:

• • Investment avenues across diverse industries: Kerala presents a compelling investment landscape across diverse industries, from tourism, IT, and healthcare to manufacturing, agriculture, food processing/technology, and renewable energy.
  • Strong foundational infrastructure: It offers end-to-end foundational infrastructure for business growth, with seamless digital connectivity, multiple international airports, dense road networks, and strategic access to major shipping routes and ports.
  • Ease of doing business: The state’s business-friendly policies, strong enabling ecosystem, streamlined regulations, sector-specific incentives, and public-private investments foster a dynamic environment for growth and innovation across industries.
  • Industry-specific investment corridors: Kerala has developed industry-specific investment corridors, including KINFRA industrial parks in Ernakulam, Thrissur, Palakkad, and Kannur, catering to diverse sectors such as textiles, defense, and petroleum. The state is also a key player in the space sector, with KSPACE (Kerala Space Park) driving investments into its well-established space and defense ecosystem. It hosts major ISRO agencies including the Vikram Sarabhai Space Center, Liquid Propulsion Systems Centre (LPSC), and ISRO Inertial Systems Unit. Trivandrum has emerged as a hub for defense and automotive innovation, hosting the Southern Air Command, BrahMos Aerospace, and the upcoming Joint Maritime Theatre Command HQ. Additionally, the Southern Naval Command in Kochi reinforces Kerala’s strategic importance, housing key facilities of all three branches of India’s defense forces. To capitalize on this defense sector presence, Kerala launched the Kerala Defence Innovation Zone (K-DIZ) in 2024, fostering a collaborative ecosystem for innovators to develop advanced solutions tailored to India’s defense needs. Beyond defense and space, Kerala is also establishing itself as a high-tech industrial hub, with leading automotive R&D centers and global capability centers (GCCs) such as Nissan Digital, TATA Elxsi, Acsia Technologies, dSPACE, and Visteon driving innovation in the sector.

Recommendations

As Kerala continues to evolve as a major investment hub, it can enhance its offerings further:

• • Expand the role of its technology hubs: The state should expand the role of its technology hubs, including Technopark, Infopark, and Cyberpark, to develop competencies in emerging technologies such as AI, robotics, and quantum computing.
  • Develop an industry-specific strategy to attract GCCs: It should leverage its strengths across various industries to develop unique, industry-specific zones that differentiate rather than compete with existing investment hubs in India. The state can create distinct investment destinations by crafting tailored strategies aligned with its core competencies, making it a highly attractive location for GCCs. For instance, it should leverage its expertise in medical device manufacturing, strong medical education system, extensive hospital networks, and skilled healthcare workforce to develop into a specialized medical devices hub. Similarly, its established space ecosystem and growing automotive R&D presence provide a solid foundation for space tech and automotive industry hubs. By integrating manufacturing with allied business and technology services, Kerala can create a competitive ecosystem that attracts GCCs in these high-growth industries, reinforcing its position as a prime investment destination.
  • Develop focused leadership and workforce: It should cultivate a future-ready workforce by enhancing leadership and skill development across key industries and emerging technologies. Through industry-aligned training programs and a robust talent pipeline, this ensures that enterprises investing here have access to a highly skilled and adaptable workforce.

Kerala is poised to be a key investment destination in India, driven by its business-friendly policies, robust infrastructure, and strategic industry corridors that foster investments across key sectors. With its strong IT capabilities, thriving startup ecosystem, and targeted sectoral growth initiatives, the state creates a dynamic environment for enterprises to innovate, expand, and thrive.

By: Eratha Poongkuntran, Research Director Shabnum Grewal, Partner