Pune, Ahmedabad and Chennai have emerged as the new industrial realty hubs in India.
Robust demand for land to set up manufacturing units by global companies over the last two years have helped growth. A pro-industry policy by the respective State Governments with subsidies and tax incentives and overall improvement in basic infrastructure has also aided the journey.
Demand for industrial land parcels is also being dictated by their access to the 1,500-km Delhi Mumbai Industrial Corridor passing through Rajasthan, Gujarat and Maharashtra. The Government intends to promote this stretch as an industrial hub and develop infrastructure as part of its long term plan, according to industry watchers.
Anshuman Magazine, Director, CB Richard Ellis said: “Earlier, only IT companies would come to India while manufacturing companies would give India the miss and set up their manufacturing units in China given India’s problems of infrastructure, archaic labour laws, bureaucracy and red tape .
However, with a rise in domestic consumption, many Japanese, European and US-based companies are setting up manufacturing facilities in States such as Gujarat, Maharashtra and Tamil Nadu, with Pune, Chennai and Ahmedabad emerging as the leading hubs among them.”
“These are across sectors such as auto, mobile phone manufacturing, pharmaceuticals, petrochemicals, food processing and construction equipment among others. Though we are far from the level of China, our pace could go up further if the present pace of reforms and infrastructure development picks up. This trend of increased industrial realty demand has led us to set up a separate unit in our business about two years ago dedicated exclusively to cater to this segment,” he added.
According to Cushman and Wakefield, the success of major industrial establishments depends on a number of criteria, including availability of talent and labour , established infrastructure and Government support. “Companies prefer to conduct an advanced study of various other factors too, including historical labour issues trends, political support, infrastructure, appreciation in land prices over the years etc before eventually deciding on the State they want to finally settle down in,” said Sumeet Bhatia, Associate Director, Cushman and Wakefield.
“It is basically the local industrial development corporations that run the show in these states. For instance, there is MIDC in Maharashtra and GIDC in Gujarat which are into acquiring land and leasing it out to manufacturing companies,” said Pinkesh Teckwani, National Head, Knight Frank.