The Hindu Business Line : Tech boom skips secondary cities

AS the IT and ITES boom sweeps the State Capitals of the Southern States, secondary cities continue to be ignored despite the potential to develop them as viable location alternatives for businesses and industries.

The Southern region is home to a large base of qualified manpower that had powered the IT and ITES revolution for India.

While Bangalore, Chennai and Hyderabad are established destinations for technology companies, the other cities in the South have not been able to capitalise on the readily available resource pool due to infrastructure constraints, according to a CII report.

While both domestic and multinational companies are on the lookout for low-cost destinations to diversity their operations, none of the so-called Tier II (on the prospect list of IT companies) are located in the South.

This could result in the Southern challenge being restricted to the three cities, with no plan for long-term sustainability and development across the region.

Though Mangalore and Mysore in Karnataka, Visakhapatnam and Vijayawada in Andhra Pradesh, Thiruvananthapuram and Kochi in Kerala have attracted some organisations, lack of infrastructural facilities has discouraged them from taking a decision.

The port city of Mangalore, with ancillary firms and the State Government's keenness to develop it, has been on the radar of MNCs as an alternative location.

Similarly, Mysore - traditionally a tourist destination - has also been in the view of MNCs. Both with credible developers could offer real estate 20-30 per cent cheaper than Bangalore.

Visakhapatnam and Vijayawada too are favoured by large foreign companies, but the limited availability of small space requirements and absence of major IT parks seem to discourage any immediate plans of companies to locate their alternative establishments.

Thiruvananthapuram and Kochi have been in focus as possible alternative cost-effective locations. Both have emerged as important IT centres while Kochi's reputed port has an attraction for investors.

But with the lack of same focus as was given to State Capitals in the region for IT development, these cities lack the same level of administrative efficiency, response and support.

"While these cities have the potential to develop as viable city locations for some IT companies for diversifying, the operational constraints have so far not let them succeed," said the background paper circulated at the recent CII-Suminfra (Summit on Infrastructure).

In these Tier-II cities, the availability of manpower is patchy and the ability to attract from outside low.

Telecom infrastructure and transport connectivity are the key concerns when evaluation a city for location for IT business. The Governments have not come forth proactively to develop these in the secondary cities, the CII report said.

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