| With large cities reaching a saturation point in terms of infrastructure, cost of living & availability of talent pool, smaller towns in the country are becoming popular among IT-ITES firms, for setting up facilities, a NASSCOM report finds. |
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Mr M D Pai, the COO and MD of Infosys and the man behind the company’s move to fresh pastures across India, believes there will be a major heightening of interest in Tier II and III cities of the country. “Jaipur, Kolkata, Mangalore, Bhubaneshwar, Visakhapatnam and Pune will be the IT-ITES destinations of the future,” he says. In his opinion, it is the availability of relevantly-skilled, IT-ITES industry ready manpower and robust infrastructure that are making these destinations just right for the sector.
Gujarat is a good example of a State that is making a significant effort to project itself as an IT destination. IT software leader, TCS has already established a presence in Gujarat and has signed an agreement with the Government for the development of an integrated workflow and document management system (IWDMS).
After Andhra Pradesh, Gujarat will be the second state in the country to develop a software system for the effective functioning of its Secretariat. TCS, meanwhile, is also looking at gearing up as a software research and development centre in Gujarat. The other Tier II city which has come up exceedingly well over the last few years is Pune.
The city has emerged on the IT-ITES map owing to the fact that it has evolved into a campus area, with scores of advanced learning schools based within its domain. From engineering colleges to management schools, Pune has them all and therefore a large pool of IT-ITES oriented manpower as well!
In the last one year, North-East Pune has witnessed a major change, with townships such as Kharadi coming up on the Pune-Ahmednagar highway.
With a large number of commercial projects and luxurious residential complexes being built in this area and IT-ITES companies showing interest, land prices too have shown a rise. The area, in fact, already has two IT parks, with state-of-the-art facilities. Many industrial units, including IT-ITES organisations, have already set up shop and more are likely to follow.
Mysore too, is making its presence felt as an IT-ITES hub. Infosys is setting up a new 9,000-seat training centre in Mysore this year, within its existing 330-acre campus. The company has already established a 4,500 seat training facility in Mysore, the largest yet in the world. With its new centre, Infosys will be able to train around 13,500 people at any one
Infosys normally conducts a 14-week training programme for its recruits. With three sessions a year, the organisation is looking at imparting training to over 40,000 employees annually. The company is also setting up a 7,750 room facility for accommodating its trainees on the campus.
Visakhapatnam is another name that comes to mind when one talks about regions beyond the Tier I horizon. The township is gaining the reputation of being IT-savvy and an emerging alterative to cities such as Hyderabad, especially for IT projects. An exclusive IT zone is currently being planned on the outskirts of Visakhapatnam by the State Government, on an area covering over 300 acres.
The zone will have world-class infrastructure as several big players are expected to set up shop here.
This zone is expected to attract investments worth Rs 200-300 crore in the next few years. Fast-track approvals will be given to entrepreneurs with two years of experience and a workforce numbering around 200 in their units.
Goa, the city of beaches and coastal cuisine is yet another emerging name on India’s IT-ITES roster. Goa does not have a very large talent base, but the expectation is that there will be a migration to this city from the metros on account of its pleasant climate, beaches and international environment.
The challenges
While life has certainly picked up for the IT-ITES sector in the non-metro environments, the fact is these cities and townships are also facing their own set of challenges that they need to combat before really making it to the spotlight.
While at one level, there is less competition in these realms, it is also true, that often, talent availability is not quite up to the mark.
The city of Jaipur, according to analysts, simply cannot sustain or support more than one or two large BPO players and a few IT services firms.
Jaipur does not have a very large talent base and as the cities around Jaipur are also small, there is little chance of manpower migration. “Infrastructure and transportation also remains a challenge for these second-rung cities,” comments Mr Pai. “Issues such as the availability of flights are always a concern,” he adds.
The belief today is that a Tier II or III city can only become an IT-ITES hub if the trend towards small city dwellers migrating to bigger towns or metros is reversed. A city’s business potential also lies in how the new IT-ITES entrants can successfully develop the local market and make migration to the larger cities unattractive.
Today’s IT-ITES companies are closely studying emerging destinations, to check their suitability for IT services’ investments.
At the end of the day, it’s quite clear that Tier II and III cities are indeed carving a place on the “preferred choice” listings of Indian IT-ITES organisations.
Just how soon they would they grow into IT hubs is dependent on industry players that are making a bid for these cities and on state governments which have to continue playing a catalytic role in making these locales IT-viable.
Gujarat is a good example of a State that is making a significant effort to project itself as an IT destination. IT software leader, TCS has already established a presence in Gujarat and has signed an agreement with the Government for the development of an integrated workflow and document management system (IWDMS).
After Andhra Pradesh, Gujarat will be the second state in the country to develop a software system for the effective functioning of its Secretariat. TCS, meanwhile, is also looking at gearing up as a software research and development centre in Gujarat. The other Tier II city which has come up exceedingly well over the last few years is Pune.
The city has emerged on the IT-ITES map owing to the fact that it has evolved into a campus area, with scores of advanced learning schools based within its domain. From engineering colleges to management schools, Pune has them all and therefore a large pool of IT-ITES oriented manpower as well!
In the last one year, North-East Pune has witnessed a major change, with townships such as Kharadi coming up on the Pune-Ahmednagar highway.
With a large number of commercial projects and luxurious residential complexes being built in this area and IT-ITES companies showing interest, land prices too have shown a rise. The area, in fact, already has two IT parks, with state-of-the-art facilities. Many industrial units, including IT-ITES organisations, have already set up shop and more are likely to follow.
Mysore too, is making its presence felt as an IT-ITES hub. Infosys is setting up a new 9,000-seat training centre in Mysore this year, within its existing 330-acre campus. The company has already established a 4,500 seat training facility in Mysore, the largest yet in the world. With its new centre, Infosys will be able to train around 13,500 people at any one
Infosys normally conducts a 14-week training programme for its recruits. With three sessions a year, the organisation is looking at imparting training to over 40,000 employees annually. The company is also setting up a 7,750 room facility for accommodating its trainees on the campus.
Visakhapatnam is another name that comes to mind when one talks about regions beyond the Tier I horizon. The township is gaining the reputation of being IT-savvy and an emerging alterative to cities such as Hyderabad, especially for IT projects. An exclusive IT zone is currently being planned on the outskirts of Visakhapatnam by the State Government, on an area covering over 300 acres.
The zone will have world-class infrastructure as several big players are expected to set up shop here.
This zone is expected to attract investments worth Rs 200-300 crore in the next few years. Fast-track approvals will be given to entrepreneurs with two years of experience and a workforce numbering around 200 in their units.
Goa, the city of beaches and coastal cuisine is yet another emerging name on India’s IT-ITES roster. Goa does not have a very large talent base, but the expectation is that there will be a migration to this city from the metros on account of its pleasant climate, beaches and international environment.
The challenges
While life has certainly picked up for the IT-ITES sector in the non-metro environments, the fact is these cities and townships are also facing their own set of challenges that they need to combat before really making it to the spotlight.
While at one level, there is less competition in these realms, it is also true, that often, talent availability is not quite up to the mark.
The city of Jaipur, according to analysts, simply cannot sustain or support more than one or two large BPO players and a few IT services firms.
Jaipur does not have a very large talent base and as the cities around Jaipur are also small, there is little chance of manpower migration. “Infrastructure and transportation also remains a challenge for these second-rung cities,” comments Mr Pai. “Issues such as the availability of flights are always a concern,” he adds.
The belief today is that a Tier II or III city can only become an IT-ITES hub if the trend towards small city dwellers migrating to bigger towns or metros is reversed. A city’s business potential also lies in how the new IT-ITES entrants can successfully develop the local market and make migration to the larger cities unattractive.
Today’s IT-ITES companies are closely studying emerging destinations, to check their suitability for IT services’ investments.
At the end of the day, it’s quite clear that Tier II and III cities are indeed carving a place on the “preferred choice” listings of Indian IT-ITES organisations.
Just how soon they would they grow into IT hubs is dependent on industry players that are making a bid for these cities and on state governments which have to continue playing a catalytic role in making these locales IT-viable.
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