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Busy With Business

BW Online Bureau Nov 08, 2014

<?xml version="1.0" encoding="UTF-8"?><root available-locales="en_US," default-locale="en_US"><static-content language-id="en_US"><![CDATA[Having excluded union territory-turned states Delhi and Goa from the overall state competitiveness rankings, it was impossible to ignore the National Capital Territory (NCT) Delhi or rather the bigger whole that is the National Capital Region. The NCR is unique because of the intensity of population and its huge purchasing power as well as the agglomeration of businesses. The NCR is as critical to Delhi as it is to the neighbouring states of Haryana, Uttar Pradesh (UP) and Rajasthan. The NCR must succeed if India has to succeed as a competitive nation. After all, the region contributes about 4 per cent to India’s gross domestic product (GDP), with tax collections contributing 15 per cent of the total, according to analysts. And NCR as a whole is able to do what Delhi has failed to till now — generate enough economic activity to utilise the resources available, and attract investments. According to the Haryana government’s website, there are more than 400 large-and-medium-scale units in Gurgaon that attracted investments worth about Rs 9,000 crore in 2006-07 and around 8,000 small-scale units which brought in Rs 900 crore. The intensity of competition among state governments within the NCR is exciting. “The competition is intense particularly among the two states to grant fast approvals and clearance in places, adjoining the border with NCT,” says Amit Sinha, president of Indicus Analytics, a Delhi-based research firm. Related Stories How We Did It? State Of Our States The States Quo The Regional Force Federal Dividends The Matrix Of Competition Jack Of All Trades Southern Success Pride And Prosperity For A Greener Valley Sample this: the annual turnover in the Gurgaon industrial sector crossed Rs 45,000 crore in 2006-07 with investments of more than Rs 10,000 crore. It is estimated to be in the region of Rs 75,000 crore at the end of 2008. Both Greater Noida and Gurgaon have succeeded in attracting big names such as Accenture, Dell and Samsung. UP and Haryana governments have been rolling out the red carpet for automobile, IT and ITeS, and fast-moving consumer goods (FMCG) companies. The investments in NCR is also a reflection of Delhi’s geographical proximity — its rail and air connectivity is the best in the country. And this is the muscle that Delhi flexes to bargain with other states, in the absence of any major investments of its own. “The agenda of National Capital Region Planning Board are predominantly Delhi-centric, with other members planning their policy around it,” says a senior bureaucrat from Haryana, who did not wish to be identified. {mospagebreak} Human resource — this is another area for which the NCR is largely dependent on Delhi. Top industries and offices in Gautam Buddha Nagar — that includes New Okhla Industrial Development Authority (Noida) and Greater Noida in UP — and Gurgaon and Faridabad in Haryana get their top executives from Delhi. More than 200,000 people are employed in the Gurgaon industrial area alone. Even some entrepreneurs have been pushed out of Delhi for lack of space. “Entrepreneurs in the services sector from places like Karol Bagh wanted to expand and have shifted base to Noida and Greater Noida, while those in manufacturing have moved to Faridabad,” says Arup Roy Choudhury, chairman and managing director of National Buildings Construction Corporation (NBCC). One of the reasons, analysts say, for such a trend is better education opportunities in Delhi compared to UP and Haryana — as it boasts more than 100 professional colleges and three major universities along with an Indian Institute of Technology (IIT). Fast Track: The extension of the metro rail from Gurgaon to Noida will add value to NCR (Pic By Amit Verma) “Those who moved to Delhi for work and better schooling for their children, continued to stay, like us, even if the work moved out,” says Kapil Dev Kumar, chief operating officer of Gurgaon-based SMART Digivision. He stays at South Extension in Delhi, with his wife Bhawna, professor at Amity International Business School, who travels to Noida every day. To make up for this drawback, Greater Noida and Gurgaon have been fighting to become ‘the’ big destinations for IT and ITeS companies such as business process outsourcing (BPO) firms. To take IT to the masses, Noida and Greater Noida authorities plan to introduce wi-fi facility. This would entail making all schools, colleges, institutions, hospitals, hotels, malls and other business establishments wi-fi enabled — to provide complete wireless network facilities to students and professionals in the area. The two districts have also found an answer to Delhi’s inability to offer affordable housing. The opportunity was grabbed by major real estate players such as DLF and Unitech. While Noida and Gurgaon are helping Delhi de-congest, some analysts say it could be detrimental for the city’s identity. “It would make Delhi less competitive and bereft of talent and life as many western cities,” says Anshuman Magazine, chairman and managing director of CB Richard Ellis, a leading real estate consultants. “Even if industries cannot be allowed to grow due to pollution, the government can create specialised zones for IT and Ites companies in Delhi.” “Not many understand that the development of satellite towns by state governments is to attract foreign investment to those regions, and not act as a support region to Delhi,” says NBCC’s Roy Choudhury. Delhi is primarily a services industry hub with more than 90 per cent of the workforce engaged in services. The Haryana and the UP government meanwhile continue to lobby with the Centre for better connectivity with the capital. The plan to extend the Metro to Noida and Gurgaon is an indication of the success of their lobbying. This is not just to support movement of people and goods from and to Delhi, but also to enhance the value of the satellite towns. m dot rajendran at abp dot in (Businessworld Issue 17-23 Feb 2009)