Operation catch up

It’s all happening in Pune. But like the classic chicken and egg conundrum, no one can quite tell which came first: IT companies or IT ...

It’s all happening in Pune. But like the classic chicken and egg conundrum, no one can quite tell which came first: IT companies or IT parks? It doesn’t matter, says a builder, who’s investing Rs 500 crore to develop an IT planet on terra firma. “All I know is that Pune is the next IT hub of the country and we must be prepared.”

It’s quite a preparation as it turns out. Consider this: There are three government-initiated software technology parks in Pune. Three phases at Hinjewadi (which is a first draw for the IT industry because the biggest of the biggies —Infosys and Wipro — are placed there); and one each at Kharadi (Zensar) and Talawade (Kanbay, Syntel).

And now, private players too appear to have been bitten by the IT bug, with at least five massive parks—and many individual built-to-suit premises —on the anvil. There’s Kumar Properties’ 36-acre Planet IT with 3 lakh sq ft of office space and 16 lakh sq ft of residential area, to be built in five phases. The Rs 10-crore first phase—an office tower—will be ready in 7-8 months at Hadapsar. That’s where Satish Magar and the other 120 Magar families are developing a cyber city too.

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Magarpatta’s 4 million sq ft software park is scheduled to be ready by 2008; three towers are ready, with three more slated to come up by 2005. Cost of investment so far? Rs 450 crore.

Kumar Builders too has jumped onto the IT bandwagon. “We may have lost out to Bangalore, but there’s no reason why we can’t catch up,” says Lalit Kumar Jain, Chairman, who’s investing Rs 150 crore in a seven-acre software park, The Cerebrum, at upmarket Kalyaninagar. The first phase with 4.5 lakh sq ft of office space will be ready by October.

	The Big Draw

			• New York-headquartered BPO, EXL Services, opened its fourth centre in India in Pune last year after looking at other cities. Says Rohit Kapoor, president and CFO, EXL, ”Five things swung it in Pune’s favour: manpower, technology, easy access, competition index and cost structure.” Now, EXL has 900 employees in Pune, adding 300 every month “because clients are ramping up”. Among the other top BPOs already in are Convergys, WNS, EDS, vCustomer, Progeon, Wipro Spectramind, MsourcE, Xansa; and a host of top IT companies from Cognizant to Persistent, TCS to Veritas Software. What’s interesting is that many of the old players, like WNS, are ramping up. Says Eric Selvadurai, president, global operations : “WNS has made additional investments of $5 million to existing operations and will add 1,000 new seats. By 2004-end, we will have 5,000 people in Pune.” The latest entrant, Convergys, has set up base in a swanky facility in Aundh with 600 people. Says Jaswinder Ghumman, vice president and country manager: “We considered three things before coming to Pune, labour pool; infrastructure, with telecom networks, fibre optic cable, VoIP backbone and satellite communications; cost of doing business.” Pune must be doing IT right.

Three more Cerebrums are on the way at Baner-Pashan Road, Karve Road and Wanowrie. Vascon Engineers is investing Rs 100 crore more to develop a second software park, Vascon-Weikfield IT Citi Infopark, off the Pune-Nagar highway. The 1.7 million sq ft park will be built in three phases over three years. Then, there’s the mega project coming up in the heart of town on Senapati Bapat Road-the ICC Convention Centre, promoted by the Mahratta Chamber of Commerce, Industries and Agriculture (MCCIA) and being developed by ICC Realty, a consortium led by Atul Chordia’s Panchshil, Arvind Jain’s Pride Housing and Malaysia’s reputed Li-Foong Group. The two IT towers of 7-8 lakh sq ft is expected to be ready by March 31, 2005. “We have invested Rs 120 crore in the first phase.” Besides, Panchshil has devoted 2 million sq ft of tech parks at different locations, on Airport Road, Viman Nagar, Kalyani Nagar. Pride too is building a 2 lakh sq ft, Rs 20 crore project on University Road, and another on Baner Road. Who’s going to occupy so much IT space?

“We already have 40,000 IT professionals in the city. From the enquiries and the growth rate—Pune’s software exports has touched $1 billion in 2003-04, and is expected to grow by at least 20 per cent—it’s clear that we must keep infrastructure ready,” says D K Abhyankar, Chairman, MCCIA.

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“Almost 70 per cent of our two ICC towers are sold or leased,” claims Arvind Jain as he rattles off names of some of the anchors including Siemens, Cognizant Technologies, ZF Steering, Persistent Systems. Other builders are not so forthcoming with names, citing confidentiality agreements. But Lalit Jain claims 50 per cent of Phase I of Cerebrum is in the “negotiations process, though it’s been a struggle”; Rajas Jain of Kumar Properties says he’s in talks with 10 companies—all MNCs; Vasudevan Ramamurthy, CMD of Vascon, says there have been “many enquiries”.

There is a tremendous lag between the time a client walks in looking for space and the time he closes the deal, admits Vasudevan, but the conversions are more nowadays, 4 out of 10 against 1 out of 10 earlier.

Builders are not leaving anything to chance, going the extra mile on facilities. So, each one is offering unlimited data connectivity, broadband optic fibre network, 100 pc generator backup; and a host of other amenities like service apartments, clubs, squash courts, golf courses. Explains Rajas Jain: “We are offering our customers everything—and more.” That too at competitive lease rates. Ask the private players if Pune is equipped for the boom, and they burst out: ‘We are trying our best. But the government should promote Pune more, and effectively, like Bangalore or Hyderabad. And clear the hurdles by giving us good roads, more power and connectivity.”

The wish list? “Pune has everything to turn it into an IT capital: quality education, talented manpower, lovely weather. All she needs is a CEO.”

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According to Pune-based Partha Iyengar, Senior VP, Gartner: “The biggest limitation is the fact that there isn’t an international airport in Pune. If that happened, the sky would be the limit.”