{"id":2273,"date":"2006-08-05T02:00:00","date_gmt":"2006-08-05T01:00:00","guid":{"rendered":"https:\/\/www.voyages-d-affaires.com\/bangalore-le-boom-et-apres-20060805.html"},"modified":"2016-02-10T09:48:06","modified_gmt":"2016-02-10T08:48:06","slug":"bangalore-the-boom-and-beyond","status":"publish","type":"post","link":"https:\/\/www.voyages-d-affaires.com\/en\/bangalore-the-boom-and-beyond","title":{"rendered":"Bangalore: the boom, then what?"},"content":{"rendered":"

With sales of $22 billion, the Indian IT services sector recorded growth of 32 % in 2005 compared with the previous year. In short, almost a disappointment for those who had become accustomed to the sector's 55 % annual growth in the years 1995-2001...<\/p>\n

Silicon India: there's no need to go into too much detail on the subject, as it's been the talk of business magazines west of the Deccan for the past few months. The tidal wave can be summed up in a few figures, which are overwhelming if you look at them from the point of view of a European IT engineer. Between 1985 and 2003, the number of qualified employees in the Indian software and IT services industry rose from 6,800 to 650,000, an increase of 9,500 %. India's 380 universities and 1,500 research institutions produce more than 200,000 new engineers and 300,000 graduates of equivalent level every year.<\/p>\n

The great threat<\/h2>\n

The paradoxical result is that the country with the highest number of out-of-school children in the world is now also the largest reservoir of skilled labour, particularly in the IT sector. A skill that is being exported: in 2004, in California's Silicon Valley, 40 % of start-ups were created by Indians. But it is mainly the local IT industry that is benefiting from the talents of this spontaneous generation, since, according to Business Week, India already has six companies ranked among the world's top 100 IT firms: Infosys, TCS, Wipro, Cognizant, Satyam and Telecom Bharti Televentures. Silicon India has its stars, like Narayana Murthy, founder of Infosys, and Azim Premji of Wipro Technologies. It also has its symbol city: Bangalore.<\/p>\n

But the reputation of the capital of the southern state of Karnakata and its 1,500 high-tech companies has scarcely been established before it is beginning to falter. The city, which produces almost a quarter of India's electronics and over a third of its software, is in danger of becoming a victim of its own success. \"While Bangalore boasted a pleasant climate and green spaces a few years ago, it is now increasingly congested, polluted and expensive. The infrastructure problems are getting worse and worse\", Carolyn Rose sums up in a note from the New Delhi Economic Mission.<\/p>\n

By becoming the high-tech capital of India, the gentle 'garden city' of the English, perched at an altitude of 920 metres, has also been transformed into a bustling megalopolis, growing in just a few years from two to more than seven million inhabitants. \"Bangalore is falling apart. Infosys, Wipro and others no longer want to invest here. Which is very bad for the city. And yet the state government remains inactive: all they want to do is change the name of the city to Bengaluru...\" lamented Deepak Parekh, co-director of the investment commission responsible for attracting and facilitating foreign investment in Karnakata, in the Financial Times last January.<\/p>\n

Victim of its own success<\/h2>\n

Indeed, revolt is brewing among the cream of local high-tech companies, who have even threatened to boycott the 2006 edition of the IT.com trade fair, the annual showcase for the power of Bangalore's software industry. Sector leaders such as Wipro and Infosys now seem to be opting instead for passive resistance to the threat of suffocation, directing their new investments away from the Karnakata to diversify their risk. Too confused, but also too expensive, Bangalore would therefore see itself 'reduced', for these fast-growing companies, to playing the role of head office and centre for high value-added services, while other activities flee to the technoparks recently opened in Hyderabad, Pune, Chennai or Gurgaon and Noida in the suburbs of Delhi.<\/p>\n

Until three years ago, in the absence of 'serious' alternative locations, the question of setting up in Bangalore was not even raised for an IT company. Now it is.<\/p>","protected":false},"excerpt":{"rendered":"

Article 1 of 2 in this dossier Special report - Bangalore: the boom, and after?<\/a><\/div>

With sales of 22 billion dollars, the Indian IT services sector recorded growth of 32 % in 2005 compared with the previous year. In short, almost a disappointment for those who had become accustomed to the sector's 55 % annual growth in the years 1995-2001... 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