Coimbatore: The next IT hub

COIMBATORE,THE NEXTITHUB

///DESTINATIONS

/// THE CITY

The long awaited IT boom, which had been dragging its feet for a while now, seems to have finally arrived in Coimbatore. EXEC investigates.

By Ayswarya Murthy

Rajiv Ramadoss, software engineer at Bosch recently packed up from Bangalore, the IT Mecca, and moved to Coimbatore. He said,“The quality of life here is good.The pay is better than what it was even two years ago.

And with the IT industry at the stage where it is, I almost feel like a pioneer.

Rajiv Ramadoss I am just getting an early start before Software Engineer, Bosch it all goes through the roof.”

He is not the only one. Now, many software companies are looking closely at Coimbatore, the IT hub-in-waiting.

All The Signs Are Here The 12th edition of Connect Coimbatore, recently conducted by the Confederation on Indian Industry, drew attention to the above fact.Attended by IT stalwarts like Ganesh Lakshminarayan, President of DELL India, Sridhar T, Executive Vice President of CTS,Ananth Krishnan K, Chief Technological Officer,TCS and other movers and shakers of the industry, the conference was about further growth and value creation to the IT industry in Coimbatore.

Avinasi Road

/// THE REAL (ESTATE) PICTURE IT or no-IT, Naren Rajan is confident that land prices are bound to go up. “We are just coming out of a bad phase (and the seven-year oscillatory real estate cycle) — a lot of political money has gone into land and developers are expecting growth, especially in the residential sector.

There is currently an over-supply of apartments in the city,” he said.

Naren Rajan CEO, Tristar

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DESTINATIONS///

Coimbatore's Infrastructure Overhaul

Sanjay Gupta, General Manager of Le Meridien, which played host to the conference, was at the centre of the action.“There is only good news for the IT sector as far as Coimbatore is concerned — despite the delays,” he said.

If anyone has a finger on the pulse of Coimbatore’s economic climate, it has to be the hospitality industry.A little more than a year ago, there were no five-star hotels in the city.Then, out of the blue, Le Meridien,Aloft and Taj (which was completed in a record time of just three months) burst into the scene, and many more appear to be in the pipeline. Surely, the sector is sensing something in the air.

And if the exponentially expanding leisure industry is anything to go by, the city seems well on its way to sorting out any deficits in its social infrastructure as well. Fun Republic and Brookfields draw such crowds that it is hard to believe the city was completely devoid of malls not too long ago.According to Karthik Balaganesan, a native of Coim-

batore, “The mall culture has caught up in a big way in the city.A lot of standalone restaurants and fast food joints like Cream Centre, Little Italy and KFC now have outlets in Coimbatore.

The city is slowly but surely shedding its conservative skin and slipping into a more cosmopolitan one.” Déjà vu, anyone?

What Took IT So Long The initial momentum in 2005, when Coimbatore was widely being talked about as the next IT destination, was not sustained.Tidel Park, a government-owned SEZ, which opened two years ago, still remains largely unoccupied. Of the seven tech parks that were planned, only three seem to have taken off. CTS, L&T and Bosch, which entered the market early on have existed and even thrived across the years.

But not many have made the attempt to follow them.Throwing light on this,

Brookefields Mall, Coimbatore

Venugopal R General Manager and Centre Head, Bosch

“At Bosch, we made a conscious decision to move to Tier II cities.”

Bosch, which set up operations in the city in 2006, has signed up for an additional space of one lakh square feet as of this year.”

Ashok Bakthavathsalam Chairman, CII (Coimbatore)

“It was CII that demanded government participation in Tidel Park.”

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///DESTINATIONS

MARGINAL NOTES According to The Customs, Central Excise and Service Tax office, the revenue growth in Coimbatore (65 percent) was twice as much as the all-India growth (30 percent) in 2011.

Sanjay Gupta General Manager, Le Meridien, Coimbatore

Make Way For MICE

Nehru_Stadium,_coimbatore

Gupta said,“I was speaking with a few Tidel Park officials at the conference and they believe that tedious government sanctions and red tape in obtaining approvals have been major deterrents.”

Another official from a leading industrial association cited other reasons.

“Lack of good infrastructure and connectivity had been slowing down the entry of many big players into the scene,” he said.“Even 10 years ago, though many would have liked to hope otherwise, the city didn’t have the kind of infrastructure to support IT. But, there has definitely been massive improvement in these areas recently.”

Naren Rajan, Chief Executive Officer of real estate giant Tristar, is fiercely proud of the city. He believes that it’s bad policy making and not lack of demand that is driving away IT investors.“Tidel Park charges exorbitantly for space,” he said,“And CII has really not being doing enough to sell Coimbatore.” He pooh-poohs the low take off rate among tech parks.“40 percent of all planned Dr R Rudramoorthy, Principal, PSG College of Technology

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projects has been executed. I can’t imagine anyone having any complaints with that.”

Techie Trouble But R Venugopal, General Manager and Centre Head at Robert Bosch Engineering and Business Solutions, believes that the problem is not unique to the city.“IT has not caught on in most Tier II cities because, though they have specific advantages, not many people are willing to relocate there due to language barriers, lack of entertainment venues and housing issues,” he said.

Last year, IT exports from the city was close to 700 crores. Malay Krishna Ray, General Manager of Sales and Services at Lokesh Machines Limited, shares his apprehensions.“The emergence of IT will boost the economy; there is no denying that.We have witnessed this in cities like Bangalore, Chennai, Pune and Hyderabad. But, I fear the poaching of manpower away from the manufacturing sectors and into the IT industry.”

However, with over 25 engineering and 18 polytechnic colleges in and around the city, a constant and steady supply of manpower is assured, accord-

Sanjay Gupta is optimistic about Coimbatore’s potential as the new MICE destination, if not displacing, then at least, competing with cities like Kochi and Jaipur. “The climate is pleasant throughout the year, unlike other popular destinations which are very seasonal,” he said. “The connectivity is better now than ever. In the absence of the required facilities, the many educational institutions, super speciality hospitals and manufacturing giants based here in the city would take their conferences elsewhere. But this is set to change. There is scope for hosting phenomenally large MICE events here and that’s the market we are keen to capture.”

DESTINATIONS///

ing to the Principal of PSG Tech, Dr R Rudramoorthy.“We, as a city, have more than enough educational institutions to supply human resources to the multi-industrial landscape.And the IT industry, more than anything else, craves fresh talent. Our students are always closely working with IBM and other top technological companies on a variety of projects.”

CII Speaks

TIDEL Park

Chairman of CII’s Coimbatore chapter,

tive, fast growing service sector.Then the dip in Coimbatore’s economy in 2005 threw things off track for a while.We were geared up to take it to the next level in 2008 and again, the big financial crash happens.” Still, he is optimistic about the current situation.“I feel we are finally on the right track and if nothing else goes wrong, Coimbatore will reach its peak potential, in terms of IT, by early 2014.” His line of reasoning has been proved right with various companies signing up for around four lakh square

The Business of CII CII has taken up the

agenda of “Business for Livelihood” for the year 2011-12. This converges the fundamental themes of spreading growth to disadvantaged sections of society, building skills for meeting emerging economic compulsions, and fostering a climate of good governance.

In line with this, CII is placing increased focus on Affirmative Action, Skills Development and Governance during

IT Park Front View

Grand Reception

the year.

With 63 offices including 10 Centres of Excellence in India, and 7 overseas offices in Australia, China, France, Singapore, South Africa, UK, and USA, as well as

Integrated Building Management System

Ashok Bakthavathsalam, Director of KG Information System, feels that the social infrastructure is one of the key aspects that needs to be looked into.

“Many developers and investors were worried that we might have missed the IT wave,” he said, reflecting on the bouts of bad luck the city had been facing.

“Post the 2000 dotcom burst, we were pushing to put Coimbatore on the IT map.We wanted to embrace this lucra-

Conference Hall

feet of office space in Tidel Park. By June, five more major IT companies are slated to set up shop here.

The government seems to be making amends, many private parties have set up SEZs and are now outsourcing the space to other companies, and the existing IT majors are in expansion mode. It looks like Coimbatore is finally getting its act together.

institutional partnerships with 223 counterpart organisations in 90 countries, CII serves as a reference point for Indian industry and the international business community.

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