Karnataka ropes in Murthy to stay on top

When competition for investment in the IT sector is hotting up among Bangalore, Hyderabad, Pune and Chennai, a beleaguered Karnataka has roped in IT mascot N R Narayana Murthy to ensure that the 'Silicon Valley' of the nation stays on top.

Murthy, in his acceptance letter to the chief minister, said: "I am grateful to you for inviting me to chair the state IT vision group. It will be a privilege and a pleasure to do so."

He is coming in at a time when Bangalore is losing out on fresh investments in IT owing to the deteriorating infrastructure, lack of availability of land at affordable prices and high salaries.

Karnataka has continued to retain its top slot as an IT exporter by clocking software services and hardware exports of $8.9 billion in 2005-06. It accounted for 37 per cent of the country's IT exports. But it lost many prestigious projects like the 'Fab City' as IT majors increasingly looked beyond Bangalore for growth.

The state lost the 'Fab City' project ($3 billion) to Andhra Pradesh after the former did not allot the land to the promoters "" SemIndia "" on Bangalore's outskirts. The state offered land to SemIndia at Nanjangud, 180 km to the west of Bangalore.

Similarly, the Taiwan Semiconductor Industry Association has preferred Hyderabad and Chennai over Bangalore for investments in chip designing.

European aerospace major EADS, which is keen on setting set up its technology centre in Bangalore, considered the aviation hub of India, has not received a positive response from the state government.

EADS is supposed to have inspected various sites. EADS CEO Tom Enders has revealed that the firm has shortlisted several locations apart from Bangalore for setting up its technology centre.

Murthy's mandate is to chalk out a time-bound programme to promote knowledge-based industries and showcase the state's ecosystem to prospective investors.

The Software Technology Parks of India (STPI) has projected IT exports from Karnataka between $10.9-11.1 billion by March 31, 2007. About 1,200 tech firms, including about 500 global corporations employ about 3.75 lakh people, including 1.7 lakh in the IT-enabled services, in the city.

By accepting the new responsibility, it seems Murthy has made peace with former Prime Minister Deve Gowda's family. Murthy had stepped down as chairman of the Bangalore International Airport Ltd after Gowda questioned his "contributions"during October last.