Thursday, December 30, 2004

Chips down for IT city; what next?

Chips down for IT city; what next?
Times of India

Will IT fly from Bangalore? There is enough data to prove that capacity additions in major players like Infosys, Wipro and TCS are happening outside of Bangalore, especially in Kolkata and Chennai.

Bangalore’s problem is not just the infrastructure bottleneck, there are others which can push up business cost here. High attrition rate and high salary levels are cited as making Bangalore unattractive. Though not all agree with this, the fact that other cities are offering quality manpower and infrastructure at lower costs may drive businesses elsewhere.

Though there has been much talk about developing other cities like Mysore, Mangalore and Hubli, little has been done to develop roads, airports and industrial parks there.

In 2005, this may change at least for Mysore. With the 300-acre campus being built by Infosys to host the world’s largest corporate training facility, Mysore’s fortunes as a IT destination may change for the good. If the new expressway between Bangalore and Mysore becomes operational by April 2005 as promised and the state government gets an operational airport, which can handle medium-sized aircraft both during day and night, Mysore will make it.

The question is what happens to Bangalore. The year 2005 should mark a watershed year for the city. It is not true that Bangalore will continue its growth irrespective of what its infrastructure hurdles are, companies are already moving. The danger is over a period of a few years, Bangalore’s growth can stagnate a la Kolkata. Unless, Bangalore’s urban planners wake up to the task at hand.


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