Infy shelves plans to develop second campus in Kerala

Ramadas Kamath, Executive VP at Infosys, says company abandoning the project due to lack of infrastructure

India’s second largest information technology (IT) services provider, Infosys, has abandoned plans to develop its second centre in Thiruvanthapuram’s Technocity. Senior executives said lack of infrastructure at the project site was why.

Ramadas Kamath, executive vice-president at Infosys, who heads infrastructure, facilities and administration, confirmed a letter from Infosys had been sent to the Technopark authorities conveying the decision.

Technopark officials denied the allegations of ‘non-cooperation’ in building infrastructure for Infosys in Technocity, the Phase IV expansion of Technopark, stating the IT Park had provided all facilities required to start construction in the acquired land.

“Technopark authorities have failed to even provide basic facilities like road, power and water, and instead are asking us to submit the bidding plan with no guarantee that they will ensure those. All his (Technopark chief executive officer’s) statements are baseless. They are hushing up their mistakes. We are going to raise this issue with the honourable chief minister,” said Kamath.

Infosys had acquired about 50 acres for setting up its second campus in the city in 2012. Even after three years the project had not taken off. Infosys already had two development centres in Technopark Phase-I and Technopark Phase-II.

At present, Infosys has about 5,000 employees working from its other campus in Kerala.

Technopark claimed it had provided for all the required facilities. “Even when Technopark has provided all basic infrastructure facilities required for construction, we haven’t received from Infosys the building plans or any explanation on this delay so far. This is a clear violation of the terms and conditions mentioned in the memorandum of understanding,” said K G Girish Babu, chief executive officer, Technopark.

Technopark had handed over the 49.84 acres of land, notified as Special Economic Zone (SEZ), on March 27, 2013, for its new campus in Technocity. According to officials, Infosys should have started the construction within a year from the date of lease deed (in this case at least from the date of handing over the possession along with notified SEZ status).

“With the excellent relationship running between the top managements of Infosys and Technopark, we do not believe the corporate would blame us for lack of support. The allegations mentioned in the letter are bereft of facts and sound like individual perceptions of the person who wrote the letter, but these need not be a considered corporate view,” Babu said.

He further clarified  Technopark had so far invested Rs 5.96 crore for the construction of roads within the proposed Technocity campus, which includes the four-lane road stretching throughout the frontage of the plot given to Infosys. As much as Rs 2.73 crore for power infrastructure and Rs 17.87 crore for water supply have also been invested to support construction activities within the Technocity. Experts also point out the shift in Infosys strategy and its performance may well also be a reason why it has not been aggressive enough in developing the campus.

Besides the company also has a good land bank. Its annual report mentions that during FY15 it invested Rs 420 crore to acquire 109.1 acres of land in Bengaluru, Delhi NCR, Mysuru, Pune and Mohali.