Small IT firms demand infrastructural support

In a significant move, the Orissa government has decided to set up 'ready-made' centres for small and medium enterprises (SMEs) in the infomation technology ( IT) sector. Almost 98 per cent of Orissa's IT companies are in the SME sector and therefore had been pressurising the government to provide them with infrastructure and buildings, which, otherwise, was turning out to be a costly affair for these low turnover companies.

State IT promotion body "" Orissa Computer Application Centre (OCAC), has been requested to carve out the details for a ready-made IT promotion centre for the SME sector. The IT department has already been provided with 1.5 acres of land by the general administration department for setting up an ' IT Tower' behind the present OCAC office near Vani Vihar on National Highway-5.

The state IT secretary P K Mohapatra recently visited different ITSME premises in the city trying to work out the difficulties faced by these small companies, in the face of stiff competition from big names like TCS, Infosys and Satyam. Some are already operating out of Bhubaneswar from a ready-made facility like Fortune Tower. Other IT biggies like IBM, Wipro, MindTree and Hexaware and BPO Genpact are also putting up their own facilities as per their needs.

Says an ITSME owner, "The government is ready to provide us with land. But that is not enough to suffice our requirement. Under present conditions we do not have the amount of money that would be required to set up a facility and build all required infrastructure for our units. The state will have to work out a ready-made variety for us like the Fortune Tower in Chandrashekharpur near NH-5."

The government has recently set up three Infocities in the Temple City with a total land area of 1,074 acres. While there is virtually no space at Infocity-I to accommodate ITSMEs, around 50-100 acres of land has been earmarked for this sector at the upcoming Infocity-II in Janla.

But the ITSMEs are not happy with the move as the Janla area is totally devoid of any infrastructure and certainly not congenial for the small companies.

A detailed discussion on how to accommodate the ITSMEs is being organised by the government during the last week of March. It is from there that a roadmap would be worked out for the ITSMEs. Says another SME owner, "We have no direction on how to go about with our companies in these Infocities. We feel that it is only meant for big IT companies who have the finances to organise infrastructure on their own".

Says Mohapatra, the IT state secretary, "It is not that the government is only concentrating on the big companies. Our mainstay still continues to serve the SME sector along with the big companies. But we require some time for building infrastructure in these Infocities. Meanwhile, we are planning ready-made centres for the ITSMEs from where they could start their future work."

Orissa aims to achieve software exports of around $1 billion by 2011-12. Currently, the state's software exports stand at over Rs 739 crore and is expected to reach more than Rs 1,000 crore in the next couple of years.

According to Mohapatra, "Big names like Accenture, Capgemini and Cognizant are also interested in coming to this city. They are just waiting for the infrastructure in the second and third Infocities to be ready."

Other than requesting for building infrastructure and land, ITSMEs have long been demanding the creation of a venture fund by the government. They have also asked for a 10 per cent price preference, subsidy on rent, allocation of 3-5 per cent of the state budget for IT projects making way for marketing subsidy replacing financial subsidy, formulating an IT road map, market development assistance (MDA) and open source initiative (OSI) over a subsidy for using licensed software.

The SME sector also wants the government to arrange for immediate higher floor area ratios of around 2.5, replacing the present 0.75; development of social infrastructure like roads, street lights, hotels, shopping malls; mass transport and security around the Infocities; reviving rent subsidy in original form for 3 years and providing land at concessional rates.