Freebies or good governance – what attracts IT companies?


Samir Sachdeva | April 19, 2010

Punjab has announced that it is acquiring 2,000 acres of land for developing IT and IT-related projects in the state. Press reports indicate that Punjab Infotech, the state government's consulting firm, is acquiring 1,400 acres of land in Rajpura for setting up an IT park. It has been reported that Punjab Infotech has 12.11 acres of prime land at Railmajra, 50 acres in Kapurthala, 280 acres in Rupnagarand and 50 acres at Sneta, in Mohali which it has earmarked for IT companies.

Though the shift of focus from agriculture to IT is a welcome move but allocating land to a select industry may be discriminating one sector over other. In the past also, the state has given land to companies like Quark Inc. at a price much below the market price. But the IT park established by Quark has not been utilised to its full capacities till date. Infosys Technologies which operated in Mohali shifted its development centre to Chandigarh, and land allocated to TCS and Wipro by Punjab got stuck with legal issues. It had also been reported that the IT tower project has to be shelved because there were no takers for it.

After the shifting of Infosys from Mohali to Chandigarh, no takers for the IT tower and under-utilised capacities of the Quark IT Park, it is evident that IT companies look forward to more than concessional land or freebies from the state governments.

The Punjab government must understand that it’s not land which attracts the IT companies but there are factors like good governance, rule of law, power supply, proper infrastructure, connectivity, educational institutes, awareness of population and above all non-interference of babus/netas in industry that actually attract the IT industry.

On the other hand, states want to catch the IT bus and offering freebies might come handy for those who have missed out so far.

So, do you think that is it freebies that attract IT industry ?



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