IT has been ruling over other industries in major cities like Bangalore, Hyderabad, Gurgaon, Pune, Mumbai and Chennai. This has led to more employments and the social status of people has increased tremendously. But the last few years have witnessed an interesting trend of awakening the two and three tier cities as preferred IT regions.
Transforming two tier cities into IT destinations was a gradual decision by premier IT industry body, Nasscom. As a result, cities like Chandigarh, Ahmedabad, Jaipur, Bhubaneswar, Kochi, Trivandrum, Coimbatore, and Kozhikode have made a notable presence on India’s IT map. The web development and Digital Marketing verticals of the IT industry has mainly helped companies in these cities to grow at a decent pace.
With the top cities in India witnessing the saturated economic growth, a number of tier-2 and tier-3 are emerging as the next IT destinations. The emerging new opportunities in tier-2 and 3 cities is due to the heavy pressure for daily life in urban cities like high cost of living, hectic traffic issues, pollution, neglected hygiene and sanitation, increased crimes and spreads of garbage in the every nook and corner.
Compelling reasons to invest in tier II and III cities for IT companies
Less urbanized cities have plenty of great perks to offer, and all those are affordable than an exhausted urban city. Right from getting homes to cheaper groceries, tier-2 and 3 cities offer a low cost of living which makes the daily life easier. Not to be mentioned that these cities tend to exhibit very low property taxes too. Also, with fewer inhabitants, it hardly takes 10 minutes to reach any destination within the city, commuting is a cinch. It is easy to save money and enjoy not having to jostle available space in the crowded area unlike bigger cities.
Challenges that not to be neglected
Along with the opportunities, there comes many challenges too for these cities, like, to run an IT organization that works 24*7 require uninterrupted electricity, high-speed connectivity etc which would be a daunting task. The security of the premises is also another important aspect and if the organizations are in good terms with state and central government, they can get CISF security (if it’s a special economic zone) or state police security, but there should be a few big organizations who are willing to setup office in SEZ for this to happen. And, above all, this will only happen if the central and state government gives the nod for the SEZ.
Government promoting new cities
Recently, H.D Kumaraswamy, Chief Minister of Karnataka announced that tier-2 and 3 cities like Hubballi, Mangaluru and Belgaum to come up as the new IT destinations. This decision would leave some burden off Bangalore. The civic infrastructure has been affected in these years with the fast pace development and promoting IT in the rural areas near Bangalore will be a relief to the City. Other cities to promote IT departments next are Coimbatore (Tamil Nadu), Bhubaneshwar (Odisha) and Tripura and there are already many good website design, web development and mobile application development companies hailing from these cities by now.
In Kerala, the government is lending a huge support to the IT industry where the Kerala Information Technology department is already promoting IT parks in rural areas which are not utilized much. The concept of the government definitely helped in proliferating IT to other districts of Kerala along with upgrading Technopark in Trivandrum and Infopark in Cochin. The seven locations in this plan include Ambalappuzha and Cherthala in Alappuzha district, Koratty in Ernakulam, Kundara in Kollam district, Kozhikode, Kannur and Kasargod.
With the expertise achieved in launching the Technopark (launched in 1990, which is India’s first IT park and one of the largest IT park in Asia in terms of the developed area) and the successful execution of the Infopark, (which is spread across 101 acres with its phase 2 over 160 acres) Kerala State IT’s other successful ventures are the 2 Cyberparks at Kozhikode. The strong support rendered by the Kerala IT department paved way to many organizations to play their role in the IT industry. This is quite an exciting opportunity to showcase the real talents and quality of the organization.
We could see many companies leveraging this opportunity and one good example is Acodez, a company that functions from UL Cyberpark IT SEZ in Kozhikode, Kerala that emerged as the service provider for some of the leading corporate companies in India like Panasonic, Axis Bank, Anchor Electricals etc and made their mark in the web development India arena, who also won many international awards for their web development and digital marketing works. They also serve clients in more than 70 counties across the globe, all from their 2 development centers in Kozhikode. In general, the advantage of these organizations that operates from tier-2 and 3 cities is that they offer good working environment to the employees with perks and benefits to lead a successful career and family life simultaneously.
All these tier-3 & 4 cities has a decent availability of quality workforce too and the main reason for this is the relatively low cost of living which makes it attractive for the people from other cities to relocate. Also, people who basically hails from these cities, but working in other tier-1 cities tend to come back to their native place, which in turn makes the availability of the workforce at par with the tier-2 cities.
Even though India can be opted as one of the less urbanized countries in the world, a serious crisis of urban growth has been faced by her population at the present time. Whereas urbanization has been a precursor for social, economic and political growth with only one-fourth of the population in urban cities, it has led to major socio-economic problems and definitely the interest of IT companies and investors backed by the right moves from government to promote these cities will help in both reducing the pressure off the metro cities as well as pave the way to development of these new cities and their nearby areas.