Odisha woos IT firms as it aims to become hub for next phase of expansion

The state government is keen to rope in IT and BPO (Business Process Outsourcing) firms who are keen to expand footprint but mindful of the costs of organic growth

Known to be one of the firsts to get the top four IT companies to set up centres on its turf, the Odisha government is sensing an opportunity to be the hub for accommodating the next phase of ramp-up by information technology (IT) and ITes (IT enabled services). The state government is keen to rope in IT and BPO (Business Process Outsourcing) firms who want to expand footprint, but are mindful of the costs of organic growth. As a destination, Odisha offers both skilled and an industry ready workforce with a cost advantage not matched by many.

“We are looking at IT firms and BPO units who want to create and sustain jobs in Odisha. Our intent is to engage companies who are willing to expand their base in Tier-II and Tier-III locations. We have initiated a direct dialogue with these companies and are also reaching out to them through industry bodies like the National Association of Software and Services Companies,” said Manoj Mishra, secretary, electronics & IT department, Odisha government. Apart from domestic bigwigs in the IT space, Odisha is eyeing to tap players who are keen to shift their entrenched bases from China to congenial and cost competitive locations.“In its geographic location, Odisha has many inherent advantages. We have an abundance of rivers and some well-developed ports. Efforts are also underway to develop air cargo facilities to fulfil industry requirements. Our competition is not just with peer states but with nations like Vietnam too”, Mishra added.In addition to the big four—Tata Consultancy Services (TCS), Infosys, Wipro and Tech Mahindra, Odisha is home to a software development centre by Mindtree Consulting. Of late, Capgemini, which was operating out of rented premises, has shifted to their own office space in Bhubaneswar.

Odisha offers 600 acres of land at Infovalley on the outskirts of Bhubaneswar. 

It is home to the second campus of IT bellwether Infosys Technologies, and has ample space to house centres by other firms. In addition, the state government has developed an electronics manufacturing cluster (EMC) straddling 207 acres at Bhubaneswar’s periphery. The cluster provides plug and play work ambience where investors can walk in and start businesses without ado.

Of late, a China-based company is evaluating possibilities to set up an LCD manufacturing unit within EMC premises. The cluster has previously attracted investments in mobile handset manufacturing, solar modules, printed circuit boards, electric vehicles and Internet of Things (IoT) devices. As per industry estimates, this Greenfield electronics park can potentially draw investments upwards of Rs 1,000 crore, spawning employment opportunities for 10,000-12,000 people.

Odisha is en route to emerging as one of the most favoured destinations for IT and electronics investments. The government has recast its existing Information & Communications Technology (ICT) policy. In the reformulated policy, the government is offering reimbursement of the Goods & Services Tax (GST), both to new and existing units. Post the policy amendment, new units in IT, ITes and ESDM verticals can avail reimbursement on State GST for five years from the date of commercial operations. Existing units can also avail the benefit if they opt for expansion, modernization and expansion, but it would only apply to enhanced production over and above the current rated capacity and limited to 100 per cent of the additional cost of plant and machinery. Moreover, a new BPO policy is expected to be unveiled before April 2020.

For Odisha, one of the differentiators is its acute emphasis on skilling.

“Apart from an investible environment and availability of social infrastructure, we have ‘Skilled in Odisha’. To us, skill remains the backbone”, Mishra said.