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Loading… City struggling to crack IT code

chandigarh Updated: Nov 20, 2013 00:41 IST
Vinod Kumar
Vinod Kumar
Hindustan Times

The city is ready to host yet another big-ticket conclave on the information technology sector - 'Destination IT@North' to be helmed by the CII in collaboration with the government - but the dream to turn Chandigarh into an IT hub remains distant. There has been growth, but the pace and its direction leave a lot to desire.

The showcase project - Rajiv Gandhi Chandigarh Technology Park (RGCTP), or IT Park - has been hit by faulty policies, delays and controversies over land acquisition. It's been eight years since its inauguration by Prime Minister Manmohan Singh. It two phases were estimated to provide direct employment to 30,000 professionals by 2012, while software export target was Rs 2,500 crore. But data given by Software Technology Parks of India (STPI), SAS Nagar - one of the organisers, along with the Confederation of Indian Industry, the UT administration and Punjab's IT department - says 15,000 have got jobs and the park earned Rs 1,800 crore in exports till the 2012-13.

One major impediment has been the land acquisition controversy. The 2004 acquisition of 270 acres for development of Phase 3 of the park was challenged in court, and in October 2012 the Supreme Court declared the acquisition illegal.

As such, the park has failed to attract IT majors. Of the 65 companies here, Infosys in Phase 1 is the only big name. Wipro was roped in for Phase 2 by allotting 30 acres, but it decided against its venture.

The cancellation of Phase 3 has left little space for companies to expand too. Firms have been demanding enhancement of the floor area ratio (FAR) from 1.5 to 2. FAR is the ratio of the built-up floor area to the size of the actual plot.

However, the administration has rejected the demand, claiming that it would have an adverse impact on the city's design. It has also not allowed subletting of buildings to other IT firms.

Meanwhile, projected as a game-changer, the Entrepreneur Development Centre (EDC) has been struggling to find takers. After its launch in 2009, it has managed to attract just four young entrepreneurs (YEs). It has 19 bays (20,189 sq feet), of which 11 are fully furnished, reserved for YEs. The rest are for small and medium enterprises (SMEs).

In practice, the bays were offered on licence basis to the highest bidder. The system, thus, favoured the financially sound, even though the basic idea was to allot the bays for the best business plans. Applications have been invited for allotment of space four times in as many years. While the EDC, which was to be completed by 2008, got delayed, the construction of built-to-suit (BTS) sites also failed to meet the deadline. Seventeen such sites were to be completed by 2009; only 10 are operational.

And as is the case with many projects in our part of the world, the IT Park has been a victim of red tape. For instance, in Phase 2, 40 acres are unutilised since 2011, as the estate office has failed to determine the reserve price.

Delay in Industrial Area too

It's been almost two months since UT administrator Shivraj Patil gave the nod for information technology (IT) and IT-enabled services (ITeS) in Chandigarh's two-phased Industrial Area. But that is still to be notified formally, even though the union home ministry recently directed the administration to notify it immediately. "It's hard to understand what the administration stands to gain by delaying the project," said Industries' Association of Chandigarh (IAC) president Arun Mahajan.

But Prerna Puri, IT secretary, said, "There has been a consistent growth in software exports from the tricity, and Chandigarh has made a considerable contribution."

She remarked that the IT Park "has reached saturation", and now the department's areas of focus would be e-governance and development of mobile applications for the benefit of residents.

The priorities seem to be shifting, as the Centre even rapped the UT administration once for allowing businesses other than IT at the facility.