Hyderabad, Bangalore, Gurgaon and Pune turning into urban nightmares

By Vipin Agnihotri

The IT boom has turned cities like Hyderabad, Bangalore, Gurgaon and Pune into cities of opportunities. But on the flip side, it has turned these cities into urban nightmares. Over the last 10 years, the tech boom has resulted in the creation of swank campuses, jobs and more epithets.

Bangalore is known as the Silicon Valley of India and Hyderabad is known as India’s uber-cool Cyberabad. If experts are to be believed, the dazzling growth of these cities has not just brought in dollars and pounds but also large-scale migration, traffic jams, pollution and creaking infrastructure.

In Bangalore, serpentine traffic jams are a daily routine as thousands of code-jocks make their way to Electronics City- home to Wipro, Infosys Technologies and other tech majors. In terms of statistics around 18,000-20,000 cars trundle up and down Hosur Road, en route to Electronics City.

The city’s infrastructure is decaying across all segments. In fact, it faces a chronic power shortage of around 1,000-1,500 MW and public transportation is erratic and inadequate to say the least.

Pune’s traffic woes are pretty much identical to those in Bangalore but it also has its own sets of other problems. It is worth noting that Pune’s foul air has ‘Talibanised’ its women, who have to wrap dupattas around their faces to escape the smothering pollution. The recent study has come to the conclusion that Pune is the 13^th most polluted city in the country. A World Bank report has ranked Pune as Asia’s fifth most polluted city.

According to government figures, the number of vehicles registered in Pune is growing at a rate of around 9 per cent per year and has crossed the 14-lakh mark. On the other hand, Gurgaon’s infrastructure belies its position as India’s third largest IT hub. However, lack of parking spaces, traffic jams and daily power cuts continue to challenge the city’s growth.

Compared to Bangalore, Pune and Gurgaon, Hyderabad seems to be better off- at least for now. Hyderabad is in a much-better situation because it does not face issues on the utilities front.

Even better, Hyderabad is in the process of building infrastructure such as new international airport and flyovers. The only problem in Hyderabad seems to be the increase in commuting time which has been forced by a slight delay in the completion of a couple of flyovers.

Suggested Reading:

• India becoming a haven for money laundering

• What are you worth? India Salary Trends

• 11 Disrupting Web 2.0 Technologies
  

Will Property boom sustain in India?

By Dhruva Jyoti Chowdhury

Kolkata, India: Presently, there is no asset bubble, so nothing to worry for people possessing property in the Indian Real Estate segment. After a bullish run for two years, the graph of the booming real estate market seems to have begun to slide. This has resulted in a virtual meltdown in the real estate segment which was considered to be overheated until a few months back. Now the realtors are setting their sight on sub urban areas for development due to the competitive land prices pushing themselves away from the metropolitan high ends. The experts in this segment suggest that in the three primary segments of the real estate development; primarily residential, commercial and retail, the strong growth with sustainability is achievable by the year 2010. Despite of the graph sliding down, ranking fifth in the retail sector from amongst 30-emerging global retail markets, the Indian real estate segment is being predicted to witness an investment of Rs 100 billion the next two financial years. And if the corporate survey is to be believed, the country will also see a steep rise of 1.19 lakh job opportunities in the real estate segment in the next financial year. The good news for investors and developers is a survey conducted by Knight Frank, a global real Estate consulting group. It states that the real estate segment in India is growing at an annual rate of 30% on the overall basis while a 20% growth rate for the organized retail segment by financial year 2012 is in the offing indicating the retail industry witnessing over a Rs. 100-billion investment up to financial year 2010. Industry feedback and business associations indicate that a large number of firms have evinced interest in setting up special economic zones (SEZs). In the commercial space segment, business opportunity is led by the unprecedented outsourcing activity in the country that in turn is driven by Information Technology (IT) or IT-enabled services. Many global firms are setting up back offices and outsourcing their work to India. According to research carried out by Knight Frank, as the trend gathers pace, commercial space requirement will expand to 100-million sq. ft. by financial year 2008. Of this, almost 75% to 80% will be contributed by the IT / ITES industry. Growth in this sector is being fuelled by incentives given by the Government of India, which has attracted huge Foreign Direct Investment. For example, the Dubai-based real estate major Emmar group is busy setting up SEZs in Haryana at an estimated investment outlay of $1.5-billion. Now days, developers are not risking their moolahs on high priced lands and are under heat at this point of time. The main problem persisting in the real estate market is the affordability. With the prices of all the three segments Sky rocketing, affordability has become a cause of concern for the realtors. This is also because of the high interest rates applied on the developers which are virtually passed on the consumers when they buy properties. Another reason for the realtors for backtracking is the increasing prices of not only land but also allied purchases including cement. The developers are feeling the heat as they are also not finding if feasible to control the labour problem at this point of time. The static income level of the middle income grade individuals who are the real investors in the market, has also added to the woes of the developers. Developers feel that the time is ripe when the Government should step in and introduce salt pans for development to woo the foreign investors who are looking forward to invest in the country. After the strict guidelines by the Reserve Bank of India to the banks directing them to only approve loans selectively and to those only with proper approvals for the land, the business has further being held up. While, investment in the residential segment is estimated to cross the Rs. 9,000-billion mark in the next five years, the number of households that are estimated to be built in the next five years stand at over 5-million. And, all this real estate construction is expected to create a surge in the growth for demand of raw materials, such as cement. Presently, 30-million sq. ft. of available mall space in India is expected to increase to 100-million sq. ft. by financial year 2010. Of the total mall space to be developed, around 75% is in cities like Mumbai, Pune, Bangalore and Hyderabad and National capital Region (NCR). The rest will be in Tier-II and Tier-III cities of Nagpur, Ahmedabad, Chandigarh and Ludhiana. And over the next three years, 300 malls are to be developed in the country including those in the sub urban areas. Reliance Industries announced its retail venture with pan-India footprint covering 1500-cities and towns that will involve an investment outlay of Rs. 25,000 Crore.

Merrill Lynch in its report on real estate trends predicts that the number of malls in these five cities - Mumbai, Bangalore, New Delhi, Hyderabad and Pune will to reach up to 250 by the financial year 2010.