The Hindu Business Line : South leads services surge, says CII study

THE States in the South have played a major role in making the country a global player and form the backbone of the country's comparative advantage in the services sector, a study undertaken by the Confederation of Indian Industry (CII) has said.

The study titled `Key factors making India a major global player: The southern stake' points to the fact that cities such as Bangalore, Hyderabad and Chennai have emerged as growth poles, creating centres of excellence in information technology, biotech and pharmaceuticals.

The study says that southern States have also leveraged their traditional strengths in textiles, marine products, gems and jewellery and engineering.

The States have led the way in producing `knowledge workers' by creating centres of academic excellence, the study says. "Majority of India's H1B visas are issued to south Indians and Chennai has the longest waiting list for F1 visas," the study has noted.

Besides, the southern States are performing well above the national average in terms of Gross Domestic Product growth.

The study also advocates on the need to work on creating growth clusters and investing in `brand equity' to recreate the success of Bangalore in other cities. The study urges heavy investment on infrastructure and removal of red tape. The study points out that the urban agglomeration of Bangalore alone contributes to around 40 per cent of the country's services exports which stands at $ 8 billion per annum and around 12 per cent of goods exports which is valued at $ 6 billion per annum.

Dynamic clusters with sectoral specialisation such as Tirupur exported $ 800 million worth of goods.

As a way forward, the study also points out that the country will have to effectively strategise between multilateralism and bilateralism. Trade liberalisation is inevitable and Indian industry will have to be prepared to grab the opportunities and minimise risks from globalisation, says the study.

The study sets a target of increasing India's exports to 2 per cent of global exports or touching $ 178 billion by the year 2010.