For a sector that has struggled to get a foothold in the city for almost two decades now, it looks like finally, the IT and ITeS firms, big and small, have embraced Coimbatore as a destination.
It looks like the floods that devastated Chennai last December seems to have helped Coimbatore finally realise its IT dream. For, in the last 12 months, about two lakh sq.ft of built-up IT space in the city was taken up by the sector.
Apart from vacant land available at the IT parks for development, Coimbatore has totally 3.6 million sq.ft of built-up IT space. Of this, nearly 1.4 million sq.ft is in special economic zones, which includes the Tidel Park and two private IT parks.
In October-November last year, nearly eight lakh sq.ft was vacant and that has reduced to six lakh sq.ft., with hardly any space available at the shared facilities at the IT parks.
The demand for space started going up in January-February for a variety of reasons, as multiple companies exploring the possibility of setting shop here. “Those who would have gone to Chennai or were looking for a location in Tamil Nadu for expansion, began looking at Coimbatore after the Chennai floods,” says Ashok Bakthavatsalam, director of CHIL SEZ.
100 % occupancy
The Coimbatore Tidel Park, commissioned in 2010, has achieved 100 per cent occupancy this year with more than 60 companies operating from it and employing nearly 9,000 people. This includes multi-national companies, start-ups and SMEs. “Enquiries started going up especially after the floods in Chennai last year,” says an official of Tidel Park.
Though IT companies were operating in the city even in the last 1990s, the real thrust came with the development of the CHIL SEZ about 10 years ago. With the Coimbatore Tidel Park, the city got the required visibility. Yet, there were issues such as international connectivity and social infrastructure that were seen as challenges for the growth of the IT sector.
Despite these problems, there has been an uptrend in interest shown by IT and ITES firms. Some of the reasons are availability of technical manpower and challenges faced by companies in cities such as Chennai and Bengaluru.
“Coimbatore has arrived. It has come into the list of happening cities, thanks to the manpower advantage, availability of technology, and the entire ecosystem for growth of the IT and ITES sector,” says K. Purushothaman, senior director, NASSCOM.
Embedded technology talent is high in the city, he says. Last year, it used to be business process outsourcing companies that were looking for space here. This year, it is more of IT support companies, says a leading property consultant. IT and ITES firms in the e-commerce, engineering, internet and start-up space are those exploring opportunities in Coimbatore.
Colleges in the western districts contribute 40 per cent of candidates recruited by IT companies in the State. Further, the retention level is relatively better in Coimbatore, point out industry sources. There are infrastructural problems in cities such as Bengaluru. Space availability is coming down in the larger cities and the cost for IT space is also high in these cities, they add. “Even if I am near an IT park and it is visible from the road, it takes an hour for me to get into the park because of traffic issues,” says S. Prashanth of Quadra Systems.
Now, annual software exports from Coimbatore are said to be over Rs. 6,000 crore. According to data available on the website of MEPZ Special Economic Zone, over Rs. 3,400 crore was the software exports from just the Elcot SEZ at Vilankurichi and CHIL SEZ in 2015-2016.
Low attrition level
Robert Bosch Engineering and Business Solution, which started its Coimbatore operations 10 years ago in Coimbatore, now operates out of three locations and employs more than 6000 people. “Our industry depends on people and the knowledge of people. Candidates from Coimbatore look for stable jobs and attrition level is relatively low. Further, we get people from other industries too. We also have managers who are from Coimbatore, have worked in other cities and wanted to come back to the city,” says T.V. Sriram, centre head, Robert Bosch Engineering and Business Solution.
With higher growth of the IT and ITES sector, Coimbatore is expected to witness faster development of social and infrastructure. And it is already in the list of Smart Cities.