Kolkata at a Glance

The erstwhile Capital of India, Kolkata has witnessed a steady exodus of
industries over the past few decades. In an attempt to recapture the lost
mantle, the West Bengal government has been trying to promote Kolkata as a hub
for IT and ITES during the past few years, and has met with some success. It is
the second most populous city in India.

Policy support

On November 1, 2001 the West Bengal government launched the Stateâ„¢s
incentive scheme for the IT and ITES industries, which is valid till October 31,
2006. The scheme is applicable to all the units that are being set up and those
that are being expanded on or after November 1, 2001. The units may be in the
private, public or co-operative sector.

The incentives are based on the location of the unit. The Kolkata Municipal
Corporation has been classified as a separate area eligible for certain
benefits.

Eligible units are allowed to remain open 24 hours a day and work in three
shifts, irrespective of national holidays. They are also out of the purview of
the West Bengal Pollution Control Board.

Infrastructure

Although many IT and ITES companies have set up shop in the city, a lot
remains to be done to facilitate business. Along with the problem of 

poor perception, several infrastructure requirements also need to be
addressed. The port of Haldia at the mouth of the Hoogly, situated some three
hours away, serves the city.

STPI: Only 2% of the approved units under the STPI scheme in the country are
located in the city. However, the city plays host to an international VSNL
gateway.

Telecom: Although the first telephones in the country were fitted here (just
five years after telephone was invented,) the current level of penetration lags
behind the other metros. With 1.2 million landlines, the city has achieved a
tele-density of only 9.5%, compared to about 15% in Delhi, Chennai, Bangalore
and Hyderabad.

Education: Being one of the oldest cities in the country, Kolkata has a good
educational infrastructure in place. It is home to one of the Indian Institutes
of Management and the oldest Indian Institute of Technology is located two hours
away from the city.

Physical infrastructure: The city has the only Metro (underground) railway in
the country, but public transportation leaves much to be desired. About 850,000
vehicles jostle for space on 1,500 km of roads, compared with a slightly higher
number of vehicles on twice the road space available in Chennai.

Power: The city does not have pre-scheduled power cuts. The average tariff
for one unit of power is Rs 3.41.

Real estate: The slowdown has forced companies to cut costs, and thus, real
estate overheads have come under thorough scrutiny. As a result, the cost of
prime office space in the CBD has declined slightly over the past two years.

TEAM DQ

Source: The ITeS Super Nine, a report by Nasscom