The information technology (IT) units operating in Chandigarh special economic zones (SEZs) have failed to meet the projections regarding employment generation, investment, exports, and economic growth, says Comptroller and Auditor General (CAG) in its latest report tabled before Parliament.
Rajiv Gandhi Chandigarh Technology Park (RGCTP) set up by the Chandigarh administration has been accorded the SEZ status by the government of India. Around nine IT companies, including Infosys Technologies Ltd, Tech Mahindra Ltd, KMG Infotech Ltd, Silicon Valley Systech Inc, 22nd Century Technologies Inc and Ramtech Software Solutions fall under the category.
The performance audit by CAG has restricted the comparison to only those units where shortfall was noticed even after five years of their notification during April 2013 to January 2014.
As per the employment statistics provided by these companies to the development commissioner, a shortfall of 66% in employment generation was recorded in five units. As per projected figures, as many as 7,578 employments were to be given employment, whereas only 2,580 were provided jobs.
As per section 5 of SEZ Act, one of the key objectives of SEZ Act was generation of employment — both direct employment for skilled and unskilled labour.
The report also noted that as many as eight units failed to meet projected foreign exchange earnings. Their actual foreign exchange earning was recorded at `2,145 crore against the projected figure of `4,742 crore. These units also failed to meet the projected exports figure of `5648 crore and could only realise `3,041 crore.
The report noted that though projections are not binding, they do serve as benchmarks for assessing a unit’s success or failure.
Partap Aggarwal, city-based leading entrepreneur and managing director IDS Infotech, said: “The projection figures couldn't be met in SEZ as the boom in IT industry has not been the same.” He added: “Despite downturn all the companies operating from IT Park are doing reasonably well.”
Even nine years after its launch, the RGCTP is still to realise its full potential— thanks to red tapisim. For the past three years, about 35 acres of prime land of the Chandigarh Technology Park has remained unutilised in Phase 2 due to the administration’s failure to amend the relevant norms in accordance with the home ministry directive.
Of around 65 IT companies, Infosys in Phase 1 is the only big name operating from the city. The local administration roped in Wipro Technologies by allotting a 30-acre plot in Phase 2. However, the company decided against setting up its venture here. Efforts to bring other big companies are yet to bear the fruit.
The administration’s acquisition of 270 acres of land in 2004 for development of Phase 3 of the park was challenged in court and in October 2012, the Supreme Court declared the acquisition ‘illegal’. The land acquisition controversy turned away many IT companies interested in setting up business here.
Despite repeated attempts, Upkar Singh, UT director, information technology, was not available for comments.