The exorbitant fixed rents

Hi guys,

Thanks for reading my blog posts. The number of audience views of my blog looks very promising. Thanks to all those who wants to know what is going on behind IT development in our Madurai region rather than feeling for why IT companies are not setting foot in South Tamil Nadu. This is my third post.

I spoke about the SEZ regulations that stops investors to move into the ELCOT IT SEZs for operation last week. What other factors are stopping them? Let us see it.


Please see this document in the link : http://www.elcot.in/pdf/IT%20space%20Criteria%20for%20allotment.pdf

It says that it makes to Rs. 28 per sq foot is the rental and minimal allocatable area in the built up space is 2000 sq ft. It makes to 56000 rupees per month for rent alone. In fact rent of the same area 2000 sq ft in Madurai's localities like KK Nagar, Anna Nagar, Bypass road will be very much less than that. So, this also plays a considerable role in stopping Medium and Small scale entrepreneurs to move into the IT SEZ IT Space. SEZ status is stated as an advantage in this document also but note that SEZ status is only advantageous for exports.

The minimum allocatable area is also very big that does not suit many of the small IT firms.

So, the rent plan for the built up space in our IT SEZ is very very exorbitant that the small and medium firms (both IT and ITES) that have very good headcounts could not move into it.

Will meet with a different perspective on the same issue in my next post. Thanks to all viewers once again.

Flawed Strategy

I completed my last post with a question what stops investors to set up in SEZ notified land banks here.

India’s SEZ Policy is the bottle neck here. There is a condition in the SEZ rules that products developed inside the SEZ notified zones should be exported 100 % which means that the software products developed in the SEZs should necessarily be exported. At present there are very less firms that 100 % export software from Madurai (Actually this SEZ Policy is said to have copied from that of China which doesn’t suit India). Rest other firms undertake local Indian projects and some handle a mixture of Indian and export software projects. So, if they plan to move into the SEZs, they have to hold two offices for which they have to pay two different rents hence increasing the costs. So, the Software Industries Development Association of Madurai (Actually, there is an association for the welfare of software firms in Madurai) have requested cancellation of SEZ status which we expect will happen soon. Will meet you guys with a different post on Madurai software scenario on 1^st April.

Guys, I know that I am not posting in regular intervals because I started in a different day. So, I request  followers to check this blog every Sunday because I have planned to post in this blog every week on Saturday. Please follow the blog every Sunday starting from 1^st April. And post your comments and suggestions for improving the blog are welcome so that we could even have discussions on it.

Thanks.

IT in Madurai Region

Hi all, I am Saravana kumaran, a B.E graduate, 22 years old. When we speak of IT in Madurai, many will say we have no big players here.

Many people in Madurai even today don't know that Honeywell has two centers for Research in software i.e Technology combined with Engineering and develops programs for air-crafts and all inside them!! Only a very few Technology players go for coupling technology with Engineering. For everybody's knowledge, Honeywell's presence in India is very limited and has two of its R&D centers here. What made them think of Madurai first? What made them to invest here again in the form of second center here? What made them increase their head count to 300+ when it was initially only 20?

Human Resource Advantage:

Besides all these, there is a big talented pool. In fact, TCS recruited close to 700 people last year from Thiyagarajar College of Engineering! Just imagine the people from Southern Tamil Nadu that would be working in Metros today. Surveys say that 40 percent of the workforce in metros of Chennai, Bangalore and Hyderabad is from Southern Tamil Nadu for which Madurai is unofficially the hub.

Madurai and down south Tamil Nadu has several Arts and Science colleges, Engineering colleges, Management institutions and what not!!

Positional Advantage :

Apart from Human Resources, Madurai has a world class airport. For details on facilities available in Madurai airport, see our airport discussion forum and its schedule of arrivals and departures.

When it comes to road, we have almost all the National Highways 4 laned branching out of Madurai. See the National Highway map of Madurai.

And railway infrastructure need not be doubted. It is also its best with trains to reach out to almost all parts of India and you could find the railway schedule in Madurai Railway Junction.


IT Infrastructure:

The city has a very good broad band internet facility through out and it has 3 notified SEZs

1. Ilandhaikulam IT SEZ (30+ acres)

2. Vadapalanji IT SEZ (240+ acres)

3. Rudradev IT SEZ (75 acres)

and the Ilandhaikulam IT SEZ built up space is ready to be occupied. But what stops the investors? We shall see it in my forthcoming blog posts.

So, I created this blog to update people on what is going on in IT Scenario in Madurai. Request people to view it and comment on it.

Cheers!!