Kerala plans to develop a digital industry ecosystem in the state

Kerala believes the recent agreement with Japanese auto major Nissan to set up a digital hub in the state is a major step towards achieving the goal

Kerala, which has been announced as the first digital state in the country, is betting on its strengths such as availability of skilled manpower and quality of life among others to develop a knowledge, digital industry ecosystem in the state.

Kerala believes the recent agreement with Japanese auto major Nissan to set up a digital hub in the state is a major step towards achieving this goal. It is also in talks with companies including Tech Mahindra and Microsoft to set up their operations in the state, said senior government officials.

The state has recently signed a Memorandum of Understanding (MoU) with Nissan Motor under which the automotive manufacturer will set up first-of-its-kind Global Digital Hub in Thiruvananthapuram, which is expected to spearhead the company's knowledge works for future mobility. The government has worked tirelessly to bring this project to the state and made it happen in almost six months from the beginning of the discussion, going through the tough due diligence that Nissan had.

"Nissan, which has been traditionally into manufacturing, is seeing a different thinking at a post-Uber era, where there is a lot of change happening. Their new centre here, which is part of this churn, if able to benchmark itself in terms of productivity and parameters and come out as the best centre, could bring in dramatic changes in how Kerala is perceived as an industry destination," said M Sivasankar, secretary, Department of Electronics and Information Technology, Government of Kerala.

Bengaluru-based Embassy Group and US-based Taurus Investment Holdings has recently inked an agreement with the state government to set up an IT infrastructure including a Special Economic Zone (SEZ) to set up an Embassy Taurus World Technology Centre and the government officials said that this would be built with an investment of around Rs 12 billion.

The government, while constrained on dolling out huge incentives to investors, promises it would provide skilled manpower, which the companies need the most for growth. It has recently launched a new IT policy with an aim to bring in more industry into the state. The aim is to develop the state as a knowledge hub for digital technology.

The state government is implementing programmes under which its 152 engineering colleges use a platform for training its students in various advanced technologies including artificial intelligence, blockchain and others, which will be completed by the end of this fiscal. This would help the students to get trained on these technologies through short courses spanning to a maximum of 12 months.

Besides, the state government has launched a project with Massachusetts Institute of Technology (MIT) for students and also in talks with University of Chicago for cybersecurity training, and the industry can also train the students as per their requirement.

The factors that could help the state to bring more innovative companies to set up shop in Kerala would be the availability of skilled manpower, its skill development initiatives and the quality of life its cities can offer, said Hrishikesh Nair, Chief Executive Officer of Technopark, the government-owned IT park in Kerala. Awareness regarding the opportunities for companies in the State has also to be built.

With around 400 companies occupied now and developing the fourth phase of the project now, Technopark has added a 100-acre space in the ongoing fourth phase named as Technocity, as a knowledge hub, where Nissan will be setting up its digital hub. The government is keen to attract other major companies to this space, focusing on Intellectual Property creation. It is planned to focus on a few verticals such as Artificial Intelligence, Cognitive Analytics, Blockchain and Cyber Security.

Technopark has so far built 9.3 million square feet and another 2 million is under development, apart from the Embassy-Taurus IT space coming up.

More than 150,000 graduates passed out in 2016-17 from various colleges in Kerala, that makes the entry-level talent pool for IT/ITES companies in the State. Around 60,000 of them were engineering graduates, according to a department presentation last year. It also claims that the state has figured among the top four states in terms of employability of engineering graduates in the year 2016, though the overall number of engineering graduates is lesser than the other states like Tamil Nadu, Karnataka and others.

Now that Nissan has conducted its scrutiny through BCG Consulting and decided to set up operations here, scrutiny by the other multinationals could not be a major challenge, he said.

More than 150,000 graduates passed out in 2016-17 from various colleges in Kerala, that makes the entry-level talent pool for IT/ITES companies in the state. Around 60,000 of them were engineering graduates, according to a department presentation last year. It also claims that the state has been figured among the top four states in terms of employability of engineering graduates in the year 2016, though the overall number of engineering graduates is lesser than the other states like Tamil Nadu, Karnataka and others.

In terms of software exports, while it has leaders from the IT services industry, Kerala accounts to a meagre $3.22 billion in FY 2016-17, out of the $114.46 billion software exports from India during the period, said officials.

Tony Thomas, corporate vice president and chief information officer at Nissan Motor, said that he has seen that several Keraliites are working on other parts of the country and the world and they are showing interest to come back to the home state. Besides, it has also seen interest from people other than Keraliites to work in the state for the quality of life it offers compared to the traditional IT hubs. It would also build up leadership team by lateral hiring.