“GLOBLALLY ACCLAIMED KERALA MODEL SURGING AHEAD’’

IT mentor G Vijayaraghavan on the roads taken by Kerala’s IT sector

When one talks about the IT growth in Kerala and the prospects, the most important thing is to look back, and see what Kerala has achieved in the late eighties. When India was not yet opened up, nor was the word IT in use, the Government of Kerala decided to set up a Technology Park in Trivandrum, with the main objective of encouraging electronic and software companies.

The main objective at that point was to create jobs for 5,000 people directly and about 20,000 people indirectly.  Over the last 26-27 years, what Kerala has achieved is significant even though the growth has not been to the levels which many other states have done. Today, the Technopark at Trivandrum employs around 60,000 people and the indirect employment is estimated at 200,000 people.

The major challenge Kerala faced during those times was that it was never looked upon as an investment friendly destination. In a way, the Technopark and the IT sector changed that for Kerala because large multinational corporations, local entrepreneurs, joint ventures between Indian and foreign companies came up within Technopark initially and later on at the Infopark at Cochin. So, in a way both Technopark and Infopark worked as catalysts for the development of the IT sector in Kerala.

The most important thing was the successive Governments in power continuously supported Technopark and the growth of IT sector thus giving a feeling of this being a completely different industry sector which did not have problems that kerala was known to have in the past. It is a fact that in the last 25 plus years, Technopark never faced any kind of labour unrest nor it had to shut down because of  hartals or bandhs called by various political parties from time to time.

What makes Kerala’s IT sector different from many other parts of the country is that inspite of three major Global slowdowns, IT sector here has been growing and did not affect the employment potential . There were no large scale retrenchments or close downs which is something that makes Kerala different from any other part of India.

The other interesting thing that Kerala actually missed out is that it did not go in for the BPO sector in a big way. So you would not have found a very large number of Data entry or medical transcription companies even though there were a few and many of those have converted or redesigned themselves  to the organizations which work today in revenue recognition for the health care sector or in terms of more sophisticated data processing and support work. That is one thing that Kerala did not have and that’s the sector which is considered to be foot loose industry and people have been able to move from one country to another. But what is most interesting is that Kerala has been able to come out with some very good success stories. Home grown companies who have become globally renowned include companies like Suntec, who are unlike a service company, a software product company and they license their products to some of the world’s most renowned banks. The other one is IBS which works very closely with the airline and logistic industry and they also have their products running in some of the world’s best airlines just like Suntec which has its product running in world’s best banks and telecos.

The third one to look at is UST Global, a company that can be considered as a largest employer in Kerala and one of the largest software companies based in the State. They have offices around the world working with top fortune 100 companies, mainly for business in the United States, even though they have large presence in Europe and Asia.

Broadly, this is the way the Industry has grown, but when you look at what one needs to see as we go forward, maybe we need to write this back but, today with the number of companies that Kerala has you will notice that many of them are home grown. But what was the big change that happened in the last five years, is Kerala’s startup policy and initiatives during the startup area came nearly four and half years ago, well before even the National Government  thought of startups. So a lot of the startup policies around India basically have followed what the Kerala Government did. The Kerala Government continues to support startups and in fact the best startup ecosystem in the country can be termed to be based in Kerala, with the Kerala Startup Mission and the Startup Village in Cochin. Also the support from the Government of India in terms of the fab-labs that have come up and the support that have come in from the department of electronics to many of the initiatives is also something which looks at how the State and the Central Government including the department of Science and technology have worked together to help new enterprises startup and hence give them support to be entrepreneurs.

The Kerala Government’s KSIDC and KFC also have been supporting a lot of startups mainly in the software sector.

As we go forward and look at what the potential is going to be, you would find that unlike many other states, in Kerala nearly 90 percent of the real estate for the software companies is provided by the Government. That number has to increase and will increase, but it is expected that the area that the private sector will put up will also increase, thereby ensuring that the dependence on real estate will not be with the Government alone. This can be seen with the few of the initiatives that has happened, the most interesting one among them is the URALUNGAL initiative in Calicut, where the corporative society put up IT space and the carnival group, the Leela and others who put up similar space and also the large project from TAURUS that is expected to come up near the Phase-III of the Technopark, Trivandrum.

The other big initiative one is going to see in the next few years is the development of the Technocity area and the knowledge city within the Technocity in Trivandrum. The Knowledge City is expected to have major Institutions, academic Institutions and others specifically working in specific areas of growth which the Government has identified. This is something that is going to make a big change and that initiative will attract companies to come to this area because there will be institutions working in areas of interest to them. The big areas where you will see Kerala’s growth happening in the future is going to be in the area of IOT, Data Analytics and Cyber security. Companies like UST Global have already set up a SOP in Trivandrum and they work very closely with their Israeli subsidiary. So you would see a lot of Cyber related security activity come up in Kerala. With both Cochin and Trivandrum becoming Smart Cities, a lot of work in the area of IOT for Smart Cities is also going to come up.

The use of IT for governance has always been a major area and Kerala State can actually be considered as one of the forerunners in this. The initiation of the Akshaya Program is one among them. The project was headed by the present Secretary of IT Mr.Shivashankar, when he was the Malappuram Collector. He was also the part of the IT department as Director IT at that time. This was looked at as a role model across the world and those initiatives have picked up.

 The other big initiative that is happening in the IT sector on the Government side is the e-health program where Kerala will probably become the first State where every citizen has an electronic Medical Record and movement from one hospital to other would be made easy with the entire health system getting connected through Information Technology.

Will Kerala’s IT sector grow is a question that lot of people ask. I can definitely say that it is going to happen and the growth will be very high and will probably rise above the National average. However, there are certain things that the Government will have to look at and the big drawback one sees today is the lack of quality in the higher education level and unless the quality of higher education increases and the people who come out of our Engineering Institutions are of a certain quality, the possibility of us losing out on new jobs here is going to be high and you will find that the brighter ones will go away and it will be difficult for new jobs to be created in this sector.

So, definitely there needs to be focus in the area of higher education, the Government policies for encouraging IT industry or the IT use in the Government are very progressive and can be considered as the best in the country. So, overall Kerala’s future in the IT sector is definitely going to be very bright and will continue to play a crucial role as a major IT destination.

 

 
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