VITA seeks 7 acres of land in Vizag

The Vizag Information Technology Association (VITA) members have urged the state government to allot seven acres of land in the city so that the companies could enjoy locational advantage.

The government has recently allotted 59 acres of land to 14 software companies at Madhurawada to set up small and medium-scale units. But the area is far from the city and it takes about 40 minutes to reach the place from Vizag.

"The state government has allotted seven acres of land to software major Satyam Computers in the city. It has also decided to allot land to other companies like TCS and Wipro in the city. Once these companies start operations, we will not be able to stop exodus of our staff to major companies as they enjoy locational advantage and have a brand image," B Prabhakar Rao, president, VITA, told Business Standard.

Citing the example of a small call centre's dilemma after 25 of its employees deserted it to join HSBC when the latter launched its operations a year ago, Rao said it would be difficult for small firms to attract and retain skilled staff if their offices are located far away from the city.

"Keeping this locational disadvantage in mind, we have urged the government to allot seven acres in the city to VITA at market value so that big buildings could be constructed to accommodate at least 100 small software units under one roof," he said.

According to Rao, software units in Visakhapatnam are anticipating 100 per cent growth in exports during this fiscal. Currently, about 50 small-scale units are operating in the city and in the Visakhapatnam Special Economic Zone (VSEZ).

While the exports from Vizag were worth about Rs 30 crore in 2003-04, they climbed to Rs 70 crore by 2004-05 and are likely to touch the Rs 140 crore-mark in the current fiscal.

"The optimism for 100 per cent growth in software exports from Vizag springs from the fact that the existing companies have expanded their business apart from operations launched by 15 new firms," he said.

The units are engaged in programming, software services, medical transcription, BPO and related works. About 70 per cent of the business comes from US-based companies, he said.