Bangalore, the capital city of the state of Karnataka is one of the most thriving business centers in India focusing mainly on information technology (IT) – the most progressive sector of the recent times. But there are major factors contributing to make Bangalore the ‘Silicon Valley of India’. Apart from the active support of the local government, easy availability of world-class IT infrastructure, skilled human resources, cosmopolitan environment, pleasant conducive climate and high concentration of IT companies and quality research and development institutions are the add-on features responsible for Bangalore’s IT status.
With the pouring of IT companies in Bangalore, a number of IT or Technology parks have developed in the city. These IT parks are built to exacting international standards, supported by state-of-the-art infrastructure and offer a one-stop solution integrating office, production, commercial, residential and recreational needs in a single location. The IT parks are houses to leading houses of the electronic industries like Motorola, Infosys, Siemens, ITI, and Wipro etc to name a few. The Government of Karnataka has identified an ‘IT Corridor’ in Bangalore and is expected to spend Rs. 200 crore over the next two years developing it. This IT corridor stretches from Whitefield through Indiranagar, Koramangala, Hosur Road, HSR Layout, Electronics City, J. P. Nagar and Banashankari. And with these IT companies to be located in this corridor, their employees of course would prefer to live in adjoining areas. This would create a vacuum of real estate for sale in Bangalore to meet the demands of the increasing workforce in the city. The prohibitive land costs are turning out to be a major concern for the real estate sector in Bangalore. Developers are facing an extreme shortage of quality land and land prices have been hiked to unreal levels. This has led to the consideration of corporates and developers alike on the creation of special economic zones (SEZs).
A SEZ, which is a specifically delineated duty-free enclave is deemed to be foreign territory for the trade operations, duties and tariffs; the main objective of an SEZ being promotion of exports and foreign exchange earnings. Many corporates willing to operate from Bangalore are indicating to consolidate in an SEZ and many developers are considering conversion of their projects into SEZs. The government of Karnataka is also taking special measures to promote SEZ to provide an internationally competitive and hassle free environment for exports. No doubt, the SEZs have a opened up new arena for real estate investment in Banglore.
Recent approval by the Karnataka Government on setting up of Special Economic Zones (SEZs) for Information Technology (IT) and Biotechnology sectors alone will account for about Rs. 20,000 crores which includes setting up of 6 SEZs. Many prominent corporates and developers have decided to invest on SEZ in Bangalore. Some of the SEZs cleared include those of Adarsh IT and IteS; Prestige Group; Dynasty, Sapphire and Tanglin Developers and Shapurji Pallonji. IT giant Wipro Technologies is setting up two SEZ in the city. These large scale investments will not only bring about economic development in the region but will help in the expansion of the real estate Bangalore sector.