Top software industry leaders have presented a blueprint to the government in Karnataka for the revitalisation of the information technology and biotech industries in the state to more than double revenue from the sectors to Rs 1,20,000 crore by 2011.

One of the key components of the blueprint is the creation of four new hubs of 500 acres each around Bangalore exclusively for companies in the IT, BT and health sectors, with industry and government jointly buying land from farmers at market rates.

Access to land in and around Bangalore for expansion, along with the city's well-documented infrastructure crisis, have been long-standing concerns for IT companies. Applications for land allotment by top names such as Infosys and Wipro have been hanging fire even as they step up investments at locations outside Karnataka.

Karnataka's leadership in the IT sector appears to be under serious threat, with software exports from the state growing by just 11% during 2007-08, compared to Andhra Pradesh's 41%, Tamil Nadu 37% and the national average of 29%.

Bangalore's technology sector employs some 6 lakh people, nearly a tenth of the city's total population.

The revitalisation blueprint, a copy of which is with ET, envisages an autonomous empowered authority to give all permissions and approvals for what it calls the 'IT-BT-Health cities.'

"A high-power committee consisting of members from the government and industry will be formed to negotiate and finalise the land procurement," it says.

In addition a monitoring panel headed by the state's IT minister and including representatives from government and industry has been suggested. Software companies are wary of property developers and real-estate companies developing technology parks and would prefer instead to set up campuses on their own. The IT industry wants the four new hubs to be located along the proposed peripheral ring road around Bangalore, which is being taken up at a cost of about Rs 3,000 crore.

To give a thrust to the new government's policy of developing tier II and tier-III cities as magnets for technology companies, the IT industry is asking for a special investment of Rs 500 crore each in Mysore and the port city of Mangalore in three years. It also wants an 'electronic city' to be established on 1,000 acres of land in Mysore on the lines of the main technology hub on the outskirts of Bangalore.

A similar integrated IT-BT-Health city is envisaged for the twin cities of Hubli-Dharwad to be set up under a public-private partnership. For the northern cities of Belgaum and Gulbarga, it wants 'electronic cities' which will help generate large-scale local employment for business process outsourcing companies.

Karnataka's new IT minister, Katta Subramanya Naidu, has asked technology companies to fan out to the state's smaller towns and cities to generate local employment and to ease the strain on Bangalore, which is groaning under poor infrastructure and problems with land acquisition.

Software companies say they are ready to invest in other parts of the state, but the government must provide adequate infrastructure and access to human resources in these areas.


Source: EconomicTimes