Sometimes, seemingly simple events leave a deep impression on one's mind. One Wednesday, three weeks ago, a set of such events unfolded. The incidents did not reveal to me, anything that I had not known; but evidence of what I'd intellectually only scanned, hit me right between the eyes that Wednesday.
So let me tell you about these events that have been the subject of such intense cogitation on my part.
Three weeks ago, inappropriately early on a Wednesday morning, my sister called me. She lives in Gurgaon. She filled up most of the 45 minute call, with rants and complaints about the sad state of life in Gurgaon. Rampant construction of office buildings, traffic gone amuck and endless commutes were on her mind. Office space was at a premium and land was four times as expensive (some exaggeration, here) as a few years ago and worst of all, the new hires these days were making outrageous demands. Too many jobs and not enough qualified people and every day a new company, seemed to sprout up to hire away office workers.
Worst of all, it seems the US returned guppies -- Gurgaon-yuppies, for those not in the know, were kicking the cost of living and prices through the veritable roof. So, these were the problems in Gurgaon, a little village outside Delhi, till recently. All in one's stride till you consider what happened, later that afternoon.
At about 1:30 pm that same day, I was supposed to pick up an old friend of mine for a quick lunch catch-up session. So, I drove up to his office in North First Street, San Jose. North First Street in San Jose is one of those mini-hubs of technology nirvana in Silicon Valley, much like Page Mill Road, in Palo Alto. The street and its immediate environs house the Who's Who of global technology companies. So, it struck me as odd, that when I walked into this office-space complex of about 14 large office buildings -- everything was eerily quiet. Countable few cars in the parking lot, no crowds of people milling between the offices, large signs of rent/lease lying around somewhat disinterestedly and that silence, again.
Remember, this was the same office complex that would have charged you $12.50 per square foot as rent till three years ago; where parking on the premises was impossible and in fact you had to walk almost a mile from alternate parking spaces. And the noise of people, traffic and endless construction would have driven a sane man batty. But, today there was just this eeriness about the place that I could not explain and office space was being given away for $0.50 per square foot.
The stark difference between my sister's picture of present-day Gurgaon and the forlorn presence of those office buildings in North First, can hardly be described. Then, it hit me. North First Street of '99 had given way to Gurgaon of 2003. The boom-town spirit of Silicon Valley had suddenly got up and moved from Northern California to a town in Northern India. The 'Gurgaon boom' had finally settled in.
And, I haven't even started talking about Bangalore, Mohali, Kochi or Mangalore. The Gurgaon boom is today's snapshot of India, Inc. In fact, it's a good name for what's happening throughout corporate India, today. Ok! Ok! call it the Bangalore boom if you want -- but, the explosive nature of the boom, especially when compared to what's happening in Europe and the US, is cause enough to celebrate.
There have been obvious changes in the geopolitics of global business and Indians have exploited these changes to the fullest. Kudos to the Indian entrepreneur for that. What's happening in Gurgaon is being repeated in many other cities, throughout India; and yes, even smaller cities like Bhubaneshwar, Kochi and Coimbatore have jumped into the fray. The news of this growth is everywhere and every day you see some evidence of it. As a measure of this, I took a compilation of business stories from a single 10-day period in July:
Building for a new boom: Developers are building the equivalent of six Nariman Points in the next 36 months to meet the soaring needs of India's hi-tech sector, reports Surajeet Das Gupta in Business Standard (July12, 2003).
'It is a real estate boom on an unprecedented scale. Over the next 36 months, the outskirts of India's metropolitan cities will be turned into vast building sites as armies of workmen backed by battalions of cranes erect high-rise towers and plush office blocks at a speed never before seen in this country. The results of this building boom will be astonishing. In the next 12 months its reckoned there will be about 8 million sq ft of new offices in cities like Bangalore, Delhi, Mumbai, Hyderabad and Chennai. That will increase to about 24 million sq ft in the next 36 months. The other extraordinary fact is that the frenetic construction activity is happening in all the major metros at almost equal speed -- though Bangalore leads the way followed by Gurgaon, the one-time satellite town that is rapidly turning into a twin city to Delhi.'
BPO jobs to touch 6 lakh by 2007: According to the Times News Network, demand for BPO services in areas like finance, marketing, sales, human resources and administration is expected to remain high through the period of 2003-2007. Furthermore, in spite of tremendous amount of capital investments and infrastructure construction, the BPO market was operating at 64% capacity and this was expected to grow to about 78%. In short, we cannot pump in money fast enough into this growing segment.
Bumper-To-Bumper Harvest: Arindam Mukherjee writes that the global automobile industry has discovered India and global car makers are vying to make India, the 'most favored nation' for manufacturing auto-parts and assemblies.
'India is fast emerging as one of the world's favorite source for auto components. Some global players are even designing a few of their new products here. And in the near future, even Indian car makers could become major players, either as exporters or as manufacturers and designers of models meant only for global markets. Just visit a few plants in Delhi, Pune or Bangalore and check out the buzz.
No wonder then that exports of auto components have gone up from $450 million in 1999-2000 to over $800 million in 2002-03. This year, the figure is expected to grow by another 25-30 per cent. Buoyed by this upbeat mood, the Automotive Components Manufacturers Association expects the industry to clock exports worth $2.5 billion by 2010, although some industry watchers feel it could be four times higher.'
India Logs Top Nos In Telecom FDI: P Vinod Kumar tells us that since 1991, the Indian Telecom sector has attracted more foreign capital than any other country.
'Indian telecom sector ranks first in terms of actual FDI inflow since August 1991 till February 2003, pipping to post many developed as well as developing countries including the South East Asian countries. More, it stands second only to petrochemicals in attracting FDI, beating other sectors in the manufacturing as well as services. Indian telecom has grossed actual FDI worth Rs 9,576.40 crore during the period starting from late 1991 to early 2003. In absolute terms, this is the highest inflow of FDI into the telecom sector in the world. Mauritius, which houses a number of holding and investment companies, emerges as a distant second with FDI grossing Rs 6,855.83 crore during the period.'
Car Sales Climb 23 Per Cent: It seems that people are doing well too -- just look at the car sales up-tick for the month of June, 2003.
'New Delhi, July 15: Car sales surged by a robust 23 per cent in June, buoyed by a jump in sales of auto majors including Maruti Udyog, Hyundai Motor and Tata Engineering. Total sales went up to 52,029 units from 42,331 units in the same month of last year, according to data released by the Society of Indian Automobile Manufacturers (Siam). Cumulative (April-June 2003) sales also grew by 30.5 per cent to 1,49,701units over 1,14,676 units sold in the year-ago period.'
From just one week's reports in July, we see that the automobile parts manufacturing sector, the outsourcing sector and the construction business are all booming. The boom in Gurgaon is not an accident -- India, Inc. has fought hard for these rewards. And, many analysts expect that GDP growth for this year will exceed 6.5%, easily one of the highest in the world.[Financial Express, Omkar Goswami].
Congratulations, India, Inc.!!!
But, what about the now moribund boom of North First Street? What lessons can Gurgaon learn from it?
Arindam Banerji will contribute a regular column to rediff.com