In The Spotlight

A tale of two cities

Financial Express Article, 07/2010, Ganesh Natarajan

Driving It seems just yesterday that two cities came into contention for becoming IT destinations in the country. At the beginning of this decade, both Kolkata and Pune were beginning to think of attracting large IT companies to set up facilities and build a path for young firms from the cities to sprout national and international wings. Kolkata had RS Software and investments by TCS and Cognizant to boast of while Pune had Zensar, KPIT and Persistent and the development of IT parks beginning to take shape. But both cities were just exporting a couple of thousand crore rupees, a far cry from the significant successes of prime movers like Bangalore, Mumbai and Chennai. Indeed, Kolkata because of the traditional sluggishness of the East and Pune because of it being in the shadow of big brother Mumbai both seemed destined to remain among the also rans of the IT sector.
Less than a decade later, the comparison of the two growth stories reveals startling differences. Data available with the Software Technology Parks of India (STPI) show that Kolkata has had a somewhat muted growth to a six thousand crore level, though it had threatened to take its place among the leaders a few years ago with politicians as well as bureaucrats extremely bullish about developments in Salt Lake, Rajarhat and confident of Wipro and many other majors building huge campuses in the city. Some waffling on commitments and the shortage of talent has led to a situation where it would be difficult to place this city among the IT leaders of the future.
In contrast, Pune has been a runaway success, possibly surpassing the acceleration levels of any city in the world, not just India. A reported exports revenue of Rs 34,000 crore in the recently ended fiscal, every company of significance present and growing in the city, all three of the home grown companies within striking distance of a thousand crore revenues and a thriving eco-system of government support, Universities and IT skills development firms, entrepreneurial success stories and the recent launch of the Indian Angel Network (IAN ) in the city—the kind of success story that city planner’s dreams are made of!
The burgeoning IT parks in Kharadi, Magarpatta, Hinjewadi and Talawade and the formation of multiple new SEZs demonstrate the vibrancy of the city and the hundreds of thousands of IT and BPO success stories that are being created here. Pune now has the dominant share of exports from Maharashtra and there is a vision to keep the growth momentum intact even as the IT and business services industry in the country moves towards its tryst with a $200 billion destiny by the year 2020.
With over 40 cities in India and the capital cities of all the neighbouring countries aspiring to the kind of success that Pune has achieved, it would be good to analyse the journey and the lessons that can be learnt. Pune has suffered and continues to have the same infrastructure malaises as any other location in the country and the historical problems of mutual distrust between the industry and the academic institutions was also a phenomenon that surfaced often even as local institutions like Bharti Vidyapeeth, Symbiosis and Sinhagad and many more substantially increased their student output and the number of business schools in the city crossed the century mark. What has characterised the city, particularly in the IT sector is the willingness to engage and succeed against the odds. In spite of the perpetual inability of the Pune Municipal Corporation to find budgets for most of its ambitious projects—the first wireless city, the ERP plan for the corporation and the implementation of digital classrooms across all the municipal corporations are all examples of great plans that have yet to see the light of day, the relative stability of physical, digital and social infrastructure and the regular engagement of the state and local government with the industry has enabled steady growth.
The active partnership of industry with academia has also blossomed with both technical and management institutions announcing collaborations with companies to set up centres of excellence and finishing schools within their campuses. A recent successful initiative of an industry-academia partnership where the business school has offered full management education supplemented by industry taught skills on contemporary areas like financial applications and business intelligence has created role models in the city. With the expectation that at least 40,000 new jobs will created by the sector in the city every year in future, the opportunities for such bridging programmes and collaborative initiatives is significant.
On the contrary, what ails West Bengal today and indeed most of the developing states including the much talked about North East of the country is the sluggishness in translating aspirations into robust action. Jammu & Kashmir with the dynamism of chief minister Omar Abdullah and his team is an exception with the University of Srinagar leading the way but a lot more has to be done in a short period of time if industry in the 20 or more challenger cities has to show the kind of success that Pune has so amply demonstrated. West Bengal is taking steps in the right direction with the appointment of industry veterans to the nodal agency WEBEL and the ambitious plans for skills development and building alternative locations across the state. It is never too late!