Saturday, March 29, 2008

‘This city is the knowledge capital of the country…’

‘This city is the knowledge capital of the country…’
IT has played a significant role in the growth and development of Bangalore. In the future too, this sector is expected to drive the economy here. M N Vidyashankar, Principal Secretary, Department of IT, shares his thoughts on the IT agenda of the city, in this chat with B S Manu Rao

Is the international airport going to make a difference to the number of IT firms coming to the city?
Air connectivity is one of the crucial factors for the economic development of a place. Bangalore has grown a lot during the past decade or so mainly due to the growth of the IT industry. Major MNCs have chosen Bangalore as their base for their research and development, software development, outsourcing operations etc. The present airport is unable to cope with the growing passenger traffic.
The new international airport is going to make a lot of difference in two ways. One is the international class infrastructure at the new Bangalore International Airport which would make passenger movement easier and smoother. Secondly, with the state-of-the-art air traffic control facility, the aircraft movement in and out of the city would be a much smoother and comfortable affair.
Have you planned more IT belts around the city to accommodate new organisations and expansions?
The State Government plans to set up five integrated townships around Bangalore. The development of these new townships is proposed to be done through private developers. The first township, coming up at Bidadi, would be dedicated to the knowledge sector. The 10,000-acre township in Bidadi would be a world class facility providing for work, residential and recreational facilities. The other townships planned are at Nandagudi, Ramanagaram, Solur and Sathanur. We hope to see planned townships coming up in these areas. Over 50 percent of the occupants of these townships are expected to be from the IT and BT sectors.
Do we have more large land parcels for IT-related development after the new CDP?
The Master Plan - 2015 prepared by the Bangalore Development Authority has earmarked certain land parcels as hi-tech zones. The Department of IT, BT and S&T is vigorously pursuing the matter with the BDA and KIADB to activate the earmarked hitech zones. The Hi-tech Corridor, a 6-lane expressway, connecting Kadabisanahalli to Electronics City, is also being considered. With the new Bangalore International Airport set to be operational soon, the North of Bangalore which has large vacant land parcels, though in private hands, is also expected to see a lot of development happening in the IT and BT space.
What is the IT sector doing for the city?
Bangalore City is on the global knowledge map. It is one of the hottest innovation and R&D hubs, home to over 103 R&D centres. Bangalore is the fourth largest technology cluster in the world after Silicon Valley, Boston and London. The booming IT sector in the city has a ripple effect on other sectors such as real estate, retailing, entertainment, transport, airlines etc. The IT sector in the city alone places over Rs 12,000 crores of purchasing power in the hands of five lakh IT professionals.
How does the city fare as an outsourcing destination?
The city is doing exceedingly well as an outsourcing destination. In the recent years, we have seen other cities competing with Bangalore as outsourcing destinations. There is therefore a spread of outsourcing operations. Export revenues from outsourcing operations have recorded 40 percent plus during the last financial year, which I must say is quite a comfortable position. However, Bangalore is more known for its software development and innovations. The city is rightly called the Knowledge Capital of the country, due to the existence of a large number of R&D centres, some of which have been recognised as Centres of Excellence. We have R&D centres in every highend activity, be it space, aviation, biotechnology, nanotechnology, defense, education, information technology, automobiles, construction, and retailing. As a result, the city is not only a hub for high-end R&D activity, but also for BPO and ITeS sectors in these areas.
What is the sort of purchasing power this sector is empowering its staffers with?
There are over 5.5 lakh people employed directly in the IT/ITeS and BPO sectors. The big three Indian firms - Infosys, Wipro and TCS - are the largest employers. Though there has been a slight slowdown in the growth of jobs, apparently due to the US recession and the declining dollar, we foresee IT companies looking at the Asian markets and the domestic market and this would mean that IT companies would continue to create jobs. There are reports of some IT companies giving lesser hikes to their employees during the current year. Nevertheless, there is plenty of purchasing power in the hands of the 5.5 lakh IT professionals. Plenty of purchasing power is also placed in the hands of the people who are directly or indirectly dependent on the IT sector. Last year, the purchasing power placed in the hands of the IT professionals was about Rs 12,000 crores, which is expected to be higher during the current financial year 2007-08.
It is now a few months since the last State IT show - Bangalore What has been the response and result so far?
Bangalore was an initiative of the State Government and the IT Industry. Last year's event was guided and driven by an advisory committee consisting of representatives from Infosys, Wipro, Texas Instrument, Mphasis, IIIT-B, Media and the Government. The feedback received regarding the event has been taken note of. Bangalore 2008 is going to be in a different shape and structure altogether, with more intensive industry flavour, foreign flavour and IP flavour.


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