Government Ready to Sell IT Parks – What’s Next for India’s Tech Industry ? – My Opinion

Introduction

In a strategic move to address financial losses stemming from vacant land, the government of Kerala has taken the decision to engage international property consultants. The objective is to sell vacant land within three prominent IT parks across the state. This decision comes in response to the pressing need to leverage these assets effectively, considering the vast expanse of unused land and built-up areas that have remained unutilized for an extended period. In this comprehensive essay, we will delve into the intricacies of this government initiative, the challenges it aims to overcome, and the potential benefits it can bring to Kerala’s IT sector and the state’s economy as a whole.

The Challenge of Vacant Land in IT Parks

Kerala, renowned for its strides in the IT sector, boasts of several IT parks that have played a significant role in the state’s economic growth. However, one of the longstanding challenges faced by these IT parks has been the issue of vacant land. A staggering two crore square feet of buildings and a thousand acres of land lie idle within the three major IT parks and their regional counterparts. Furthermore, the construction of an additional one crore square feet is currently underway. This situation presents a financial setback for the government, as these underutilized assets represent missed revenue opportunities and underperformance in an industry that has immense potential.

The Decision to Engage International Property Consultants

Recognizing the urgency of addressing this issue, the government of Kerala has opted to seek the expertise of international property consultants. The objective is twofold: to identify strategies for monetizing these idle assets effectively and to attract companies and investors to utilize them optimally. The engagement of international property consultants signifies a commitment to exploring global best practices in real estate management and attracting international investment.

One notable feature of this decision is the innovative incentive structure provided to the international property consultants. They will be entitled to two months’ rent fee from the lease if they successfully contract the vacant premises with any company. Additionally, if the land is leased, the company holding the land will pay a fee equal to a percentage of the lease premium, which will be fixed as the lease rent. This incentivized approach is expected to motivate consultants to actively seek out opportunities for leasing and development within the IT parks.

An In-Depth Look at the IT Parks

To understand the scope and potential impact of this decision, it is essential to examine the three major IT parks in Kerala:

1. Technopark, Thiruvananthapuram: Technopark, the first IT Park in India, spans a sprawling 766.86 acres and has a completed built-up area of 106 lakh square feet. Currently, 486 companies operate within this park, contributing significantly to the state’s IT ecosystem. The park consists of five campuses, including Technopark Phase I, II, III, Phase IV (Technocity), and Techno Park Kollam.
2. Infopark, Kochi: Infopark, located in Kochi, is another prominent IT hub in Kerala. It encompasses 380.29 acres of land and has a built-up area of 7,20,590 square feet. Similar to Technopark, Infopark hosts numerous IT companies, playing a pivotal role in the state’s tech landscape.
3. Cyberpark, Kozhikode: Cyberpark, situated in Kozhikode, is an emerging IT destination. While it may be smaller in comparison to Technopark and Infopark, its growth potential is significant.

The Potential of Vacant Land and Built-Up Areas

Unlocking the vast potential of vacant land and underutilized built-up areas within these IT parks holds immense promise. It can drive several positive outcomes:

1. Economic Growth: The influx of companies and investments into these IT parks will stimulate economic growth in Kerala. It can create job opportunities, attract talent, and contribute to the state’s GDP.
2. Revenue Generation: Leasing out vacant land and built-up areas will generate revenue for the government, potentially offsetting past financial losses.
3. Infrastructure Development: The development of these unused areas can lead to improved infrastructure, including roads, utilities, and public amenities, benefitting not only the IT parks but also the surrounding communities.
4. Promotion of Entrepreneurship: By providing a conducive environment for startups and businesses, these IT parks can become incubators for entrepreneurship and innovation.
5. Global Competitiveness: Kerala can enhance its competitiveness on the global IT stage, attracting national and international IT companies and investors.

Conclusion

The government’s decision to engage international property consultants and address the issue of vacant land within Kerala’s IT parks is a commendable initiative. It reflects a commitment to leveraging valuable resources, promoting economic growth, and ensuring the optimal utilization of these IT hubs. As the consultants explore avenues for leasing and development, the future of Kerala’s IT sector looks promising.

Unlocking the potential of vacant land and built-up areas is not just an economic opportunity but also a strategic move to solidify Kerala’s position as a leading IT destination in India. It is a step toward harnessing the power of technology and innovation to drive progress, create jobs, and enhance the quality of life for the people of Kerala. In the dynamic and ever-evolving landscape of IT and real estate, this initiative has the potential to reshape the future of the state and position it as a beacon of technological excellence.