Hyderabad: The potential to sustain long-term IT growth coupled with proactive initiatives from the Andhra Pradesh government have transformed Hyderabad in to India's fastest growing IT hub says a new report from the government of Andhra Pradesh and real estate consulting firm Jones Lang LaSalle Meghraj, at the Hyderabad IT Summit 2008.
According to the report, Andhra Pradesh - The chosen destination for IT, released today Andhra Pradesh earns the fourth largest revenue from IT exports from India amounting to Rs185 crore, representing about 15 per cent of the total IT / software exports from India.
Beginning with the state's initiative of over a decade towards the development of the successful Hitec City in Hyderabad and policy initiatives aimed at bolstering investment, IT development is gradually spreading to other cities within the state. Moreover, the Andhra Pradesh government is now looking proactively at foraying into sunrise IT sectors such as KPO along with animation and gaming.
According to the report, the Indian real estate market is not only growing in terms of pace, but also in scale. Real estate growth engines are no longer in cities such as Delhi, Mumbai, Bangalore, Chennai, Hyderabad, Kolkata and Pune.
The smaller cities are now expected to be the growth drivers over the next decade. More that a dozen Tier III cities compete with each other to attract developers, investors and occupiers. The smaller cities in Andhra Pradesh will have an advantage due to relentless government support.
"The IT boom has had a significant impact on real estate development in Andhra Pradesh," said Anuj Puri, chairman and country head, Jones Lang LaSalle Meghraj. "The state offers tremendous development potential with Hyderabad at the epicentre of IT growth, followed by emerging cities such as Visakhapatnam, Vijayawada and Tirupati.
"The state's initiatives and strategies for infrastructural development, human resource development and policy framework to support and attract investments have helped it become an attractive investment destination for developers and occupiers. From the positive growth momentum built by the government, Andhra Pradesh is steadily placing itself firmly on the global business map," Puri added.
Highlights of the report:
- Andhra Pradesh has the highest number of SEZs approved by the central government for the IT sector (as of 31st December, 2007). It is expected to get a total of 71 SEZs, which will create overall jobs for more than 2.5 million people.
- Digital Entertainment City is envisaged to be developed as the largest animation and gaming hub in South Asia and will be developed through private-public partnership. The city will have world class in facilities and incubation centers.
- With relatively lower rental and commercial values when compared to major cities, Hyderabad is still affordable in terms of real estate costs and living.
- A new information-communications-technology (2005-2010) is in place to make Andhra Pradesh the most attractive and preferred destination for IT companies.
Overall, the report concludes that buoyed by significant infrastructure development and the emergence of Hyderabad as the prime IT hub of Andhra Pradesh, the government has identified the IT sector as one of the most important economic drivers for the state, which presents a compelling investment opportunity.
Jones Lang LaSalle Meghraj is the Indian operations of Jones Lang LaSalle, the only real estate money management and services firm named to Fortune magazine's "100 best companies to work for" and Forbes magazine's "400 best big companies."