Emergent Nagpur

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A White paper on showcasing Nagpur as an IT/ITES Destination . A report instituted by SPANCO - Partner in Nagpur City's development.
Prepared by pManifold's under its growIT.initiative

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Emergent Nagpur

  1. 1. FOR RELEASE DURING THE NAGPUR CALLING CONFERENCE, NAGPUR – FEB 2012 Emergent NagpurWhite paper on showcasing Nagpur as an IT/ITES Destination A report instituted by Partner in Nagpur City’s Development Prepared by A Report on Nagpur as an IT/ITES Destination
  2. 2. WhitepaperContentsForeword ............................................................................................................................................................... 4City Introduction .................................................................................................................................................... 5 Quick Facts on Broad Nagpur demographics.............................................................................................................6 Nagpur on radar of experts .......................................................................................................................................7 Attractiveness for IT/ ITES Companies .......................................................................................................................8IT-ITES Industry Profile........................................................................................................................................... 9 Macro IT landscape ....................................................................................................................................................9 Distribution of Exports by year and by business models ............................................................................................................................... 10 Distribution of companies by age and front office locations ......................................................................................................................... 11 Functional Areas of companies...................................................................................................................................................................... 12 Technical competencies of companies .......................................................................................................................................................... 13 Top Performing companies at Nagpur – export oriented .............................................................................................................................. 14 Visible Inorganic growth ................................................................................................................................................................................ 15 Talent Profile ...........................................................................................................................................................16 Working professionals ................................................................................................................................................................................... 16 Fresh Talent ................................................................................................................................................................................................... 17 Talent in Engineering programs .................................................................................................................................................................... 17 IT /ITES Industry Support system .............................................................................................................................18 Typical IT / ITES industry setups .................................................................................................................................................................... 19 Benefits of operating in MIHAN SEZ ............................................................................................................................................................. 20Infrastructure ...................................................................................................................................................... 21 Commercial Office Space .........................................................................................................................................21 National & International Connectivity .....................................................................................................................21 Utilities .....................................................................................................................................................................22 Power Supply................................................................................................................................................................................................. 22 Water Supply ................................................................................................................................................................................................. 22 Telecom Infrastructure .................................................................................................................................................................................. 22 Local Governance - NMC ............................................................................................................................................................................... 22 Major Industrial & Commercial Hubs ......................................................................................................................23Emergent Nagpur: An IT/ITES Destination Page 2 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  3. 3. WhitepaperRisks .................................................................................................................................................................... 24Quality of Life ...................................................................................................................................................... 25 Availability of Hotels ...................................................................................................................................................................................... 25 Residential Accommodation .......................................................................................................................................................................... 25 Cost of Living ................................................................................................................................................................................................. 26 Local Transportation ...................................................................................................................................................................................... 26 Crime Rate ..................................................................................................................................................................................................... 26 Pollution Levels ............................................................................................................................................................................................. 27 Entertainment ............................................................................................................................................................................................... 27Local IT business leader Survey results: Nagpur as an IT Destination? ................................................................. 28 Doing business............................................................................................................................................................................................... 29 Impact on making sales ................................................................................................................................................................................. 30 Attrition and talent inflow ............................................................................................................................................................................. 31Important Websites ............................................................................................................................................ 32About Spanco – Partner in Nagpur’s Development .............................................................................................. 33About Nagpur Calling Conference 2012 ............................................................................................................... 36Emergent Nagpur: An IT/ITES Destination Page 3 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  4. 4. WhitepaperFOREWORD According to NASSCOM, the IT / ITES industry is growing at a healthy rate, and to meet expansion objective, companies must setup facilities in Tier 2 / 3 regions and take advantage of untapped local talent and significant cost arbitrage when compared to Tier 1 cities . Nagpur, the geographical centre of India and the second capital of Maharashtra state, is one such region in India which has a considerable potential to grow, prosper and contribute to the growth of the nation. Developed infrastructure, first-in- the-nation initiatives for privatization and public private partnerships in the utilities sector, sizable supply of skilled human resources, clean and green environment, short commute times, weekend getaways, enriching and balanced lifestyle and a growing IT /ITES activity makes Nagpur an emerging IT destination. The one-day Nagpur Calling IT /ITES conference - a joint initiative by VED, NASSCOM, VASE and MADC – intends to enable companies to explore business opportunities at Nagpur. With strong regional know how of servicing over 4 lac customers in the industrial, commercial and residential space and continuing its efforts as a partner in Nagpur City’s development, Spanco has instituted this report so as to support IT/ITES business leaders with information and insights which will be useful in decision making on the prospect of setting up base at Nagpur. The report contains insights on the Nagpur city, the infrastructure available, the profile of the local IT industry and talent, quality of life, opinions of local IT business leaders and more. Kaustubh Dhavse SVP – Strategy, Spanco Ltd. Emergent Nagpur: An IT/ITES Destination Page 4 of 38 © 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  5. 5. WhitepaperCITY INTRODUCTION Nagpur is centrally located, with two national highways going through it and over 500 flights flying over it every day. Nagpur is at the geographical center of India, is the 13th largest city in India and third largest city in the State of Maharashtra after Mumbai and Pune. Largest city in a 500 km radius. industrial, commercial and Nagpur is a major transportation center in Central India region. ‘Second capital’ and ‘winter capital’ of the state of Maharashtra The city has the busiest Air Traffic Controller (ATC) with over 1 500 national and international flights passing over it every day. It is known as ‘Orange City’ due to the production of Mandarin oranges in the region Almost 47 per cent of Maharashtra state power is generated in and around Nagpur Home to one of Asia’s largest industrial Estates, Butibori (approx 6000 ha). . 1 http://articles.timesofindia.indiatimes.com/2008-12-17/nagpur/27916662_1_nagpur-airport-airport-director-landing Emergent Nagpur: An IT/ITES Destination Page 5 of 38 © 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  6. 6. WhitepaperQUICK FACTS ON BROAD NAGPUR DEMOGRAPHICS Geographic Location Central India (with zero mile marker); Flying distance from Mumbai 1 hr 15 min Time Zone GMT + 5:30 hrs Area 218 sq. km. Population (Density) 2,405,421 (11,101/sq.km) Census 2011 2 Literacy rate  93.13% - Overall Census 2011  96.16% - Male  89.99% - Female Languages  Marathi  Hindi  English Weather Conditions  Extreme weather with 3 main seasons – Summer, Monsoon and Winter  Avg. temp: Max 46 °C; Min 10 °C  Avg. rainfall: 124.2cm Ranking  Fastest growing richest cities in India  Amongst the top 3 Green cities in India Stability  Political: No significant riots  Environmental: Almost zero probability of earthquake, volcano and flood; Moderate to severe drought prone classification  Social: Amongst lowest and further decreasing 3 criminal rate, 68% reduction in last 5 yrs. Major Industries  Textiles, Coal mining, Transportation, Steel & Logistics2 Census 2011 - http://www.census2011.co.in/census/city/353-nagpur.html3 Nagpur Police - http://nagpurpolice.info/crime_in_nagpurEmergent Nagpur: An IT/ITES Destination Page 6 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  7. 7. WhitepaperNAGPUR ON RADAR OF EXPERTS 4 5 McKinsey Institute of Competitiveness 2011  Nagpur has been identified as one of  Nagpur Rank 13 in Overall ranking of the 12 global cities which are 100 cities in terms of their representative of the largest competitiveness in India. middleweight cities to be ranked in the top 20 GDP for its respective country or region. 6 PWC 2010 • India Top 100 IT Companies – 3 companies from Nagpur • Persistent ranked 5, Micropro ranked 76 & Excellon ranked 88 • List based on Revenue for the year 2009 7 8 KPMG NASSCOM Earlier • 31 Emerging Global Destinations • Nagpur identified `Challenger’ to • 3 cities of India. Nagpur among them `Leaders’ like ‘Bangalore’ • Nagpur – Educational Hub; Lower • Mentions Nagpur as - Location with crime rate, Pollution & cost of living competitive labor, infrastructure and • Nagpur – Lower Attrition Levels enriching living environment. 9 10 Jones Lang LaSalle Knight Frank • Nagpur among Top 5 Tier III cities. • 15 Growth Centers in India assessed • Nagpur and Kolkata - Only tier 3 cities • Nagpur is #1 - People and with comparable supply of manpower Infrastructure. to Pune. • Nagpur #3 – Business Environment • Cost of Manpower 15-20% less than • Overall rank – #2 Kolkata and Pune.4 McKinsey Global Institute (MGI) report - Urban world: Mapping the economic power of cities - 20115 Institute of Competitiveness 2011, http://competitiveness.in/wp-content/uploads/2012/01/CCR-2011-Business-World.pdf6 PWC – Global Software Top 100, Dec 20107 KPMG: Exploring Global Frontiers – New Emerging Destinations, Feb 20098 NASSCOM: Location Roadmap for IT-BPO Growth in India, 20089 Jones Lang LaSalle: India -Next IT Off shoring Locations -Tier 3 cities, Q1, 200710 Knight Frank: Emerging Growth Centres, India, Q1 2007Emergent Nagpur: An IT/ITES Destination Page 7 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  8. 8. WhitepaperATTRACTIVENESS FOR IT/ ITES COMPANIES Challenge Partial Gap On-Track Elements Dimensions Score11 Description/Rationale1 Location Attractiveness Cost of real estate  Lower than most tier 1 and tier 2 cities. Occurrence of  Low risk of both droughts as well as floods. natural calamities  Seismic zone 2.  Very low crime rates, both in terms of overall crime and crime against women Cost of Operations  The city offers lower cost of operations compared to Tier 1 and tier 2 cities2 Hard and Soft Fresh talent availability   Nagpur is an educational hub Fresh talent is available in abundance with a number of Infrastructure engineering schools around Nagpur and talent flows from central India region. Availability of  Potentially better or wider opportunities available in Lateral Talent cities like Pune, Hyderabad and other metro locations attract experienced talent  Most companies believe they have difficulty in attracting mid-management level talent. Infrastructural  STPI & MIHAN have incubation facilities. New IT Parks facilities coming up.  Top class Internet connectivity from multiple ISPs is available  High reliability Power supply zone (Zero Load Shedding)  Excellent internal infrastructure in terms of road networks; this results in reduced traffic congestion3 Access to markets Infrastructure to reach markets  Limited industry events locally to tap into global or domestic market  Limited direct flights to destinations abroad4 Investments International and national  Boeing has set up a USD 185 millions Manufacturing, Repair and Overhaul (MRO) center. investment  TCS and Infosys have recently confirmed their plans to invest in MIHAN  Maruti’s second stockyard after Bangalore is 12 announced for Nagpur.  Entry of major real estate players including Godrej 13 Properties etc.11 Nagpur score evaluated for local IT Businesses from various qualitative sources (pManifold analysis)12 http://www.moneycontrol.com/news/business/maruti-suzuki-to-setstockyard-facilitynagpur_661562.html, 201213 http://www.moneycontrol.com/news/business/godrej-properties-enter-nagpur-for-housing-project_592736.htmlEmergent Nagpur: An IT/ITES Destination Page 8 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  9. 9. WhitepaperIT-ITES INDUSTRY PROFILE MACRO IT LANDSCAPE 14 No. of IT companies  160+ (secondary research) including companies serving domestic markets  84+ registered w/ STPI (w/ 46 actively reporting) serving export market No. of IT Parks 5 devoted IT parks:  MIDC IT Park @ Parsodi  MIDC IT Park @ Sadar  Lambent IT Park @ Besa (private)  MIHAN  SP Infocity SEZ @ MIHAN (ready for use) Total Export Rs. 14, 418.14 lac. (USD 29.23 million) (2010-11) Approx. employment 3500+ (only for export oriented companies)  15% year-on growth  8% attrition  Avg. 3-5 yrs. Experience No. of big M&As in last Two major 2 years 14 pManifold research showing approximate values Emergent Nagpur: An IT/ITES Destination Page 9 of 38 © 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  10. 10. WhitepaperDISTRIBUTION OF EXPORTS BY YEAR AND BY BUSINESS MODELSStrong Software Export sales from STPI registered active CompaniesExports higher thanNational average 20,000.00with higher risk 49.69%mitigation from Recession 6.82% 15,000.00 Export in INR (Lacs)recession – IT -15.31%Services dominatesover Products in 10,000.00both Export andDomestic markets 5,000.00 - FY 2007-08 FY 2008-09 FY 2009-10 FY 2010-11  The YOY growth for FY08-09 was 49.69% against National IT growth of 26.84%.  Exports have improved over the last year. Distribution of Exports by Business Models Software ITES/BPO & Other Development Product based : 22.67% 76.32% 0.41% Other 23.27% Embedded Software 0.60% • Mostly Services companies dominate over the Product companies primarily due to export market • The Product companies are significant in the domestic market including Location Guru, Excellon etc.Emergent Nagpur: An IT/ITES Destination Page 10 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  11. 11. WhitepaperDISTRIBUTION OF COMPANIES BY AGE AND FRONT OFFICE LOCATIONSMatured industry • A significantly large number of local companies are older than 5 years • A good number of fresh startups are mushrooming around the maturedwith wide global companies primarily in the product spacepresence andclientele Front Office Locations (other than Nagpur) 16% 11% 74% USA Europe Others (Australia, Japan, etc) • Most companies serving the export market have office locations outside India • Over two-third companies have offices in the USAEmergent Nagpur: An IT/ITES Destination Page 11 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  12. 12. WhitepaperFUNCTIONAL AREAS OF COMPANIESHeterogeneous Functional areas servedLandscape withservice coveragein Niche areas Web Development & Maintenance 46%for both Export Technology Consulting 15%and Domestic Technology Consulting 12%Markets Technology Architecture 12% Systems Integration 8% SAP 8% Product Development & Maintenance 46% Other 19% NetworkingSolutions 8% Mobile Computing 27% Location based services 4% IT Support 27% IT Strategy & Transformation 4% Internet Marketing /SEO/ SEM 8% GIS 8% Game Development 4% ERP / Business Management Software 38% Electronic Data Interchange 15% Data Transcription 4% Data Mining 8% Business Intelligence 12% Application Development & Maintenance 58% Animation 4% The sum is not equal to 100% as many companies work in more than 1 area of specialization. This is an indicative view constructed using a representative sample of the local IT companiesEmergent Nagpur: An IT/ITES Destination Page 12 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  13. 13. WhitepaperTECHNICAL COMPETENCIES OF COMPANIESStrong Domain Technology Areas servedKnowledgeacross Web Based - PHP 35% Web Based - JSP 31%Technology Web Based - HTML 27%areas Web Based - ASPX 38% Waterfall Project Management 12% Other 73% Oracle 27% Mobile - Windows 19% Mobile - Symbian Java 15% Mobile - Symbian C++ 4% Mobile - Symbian 8% Mobile - iPhone 15% Mobile - Blackberry 27% Mobile - Android 19% Mac 12% Linux 23% Internet Rich Applications - JFX 12% Internet Rich Applications - SilverLight 12% Internet Rich Applications - Flex 15% IBM Technologies 8% HP technologies 4% Enterprise/Server - .Net 46% Ent./Server-Obj. C++ 8% Ent./Server - C++ 23% Database - SQL Server 46% Database - MySQL 42% Cloud Computing 38% Agile Project & Product Management 46% The sum is not equal to 100% as many companies work in more than 1 area of technology. This is an indicative constructed using a representative sample of the local IT companiesEmergent Nagpur: An IT/ITES Destination Page 13 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  14. 14. WhitepaperTOP PERFORMING COMPANIES AT NAGPUR – EXPORT ORIENTEDEstablished Company Key Products/ Services Primary Business ModelsExcellence and Persistent Software Development IT OutsourcingGlobal DeliveryModel - Top GlobalLogic Mobile Computing IT OutsourcingExporters inFY2009-2011 Infocepts Business Intelligence IT Outsourcing Easypack ITeS/Software Development IT / ITES Outsourcing Zeon Software Development IT Outsourcing Cbay Systems Medical Transcription IT Enabled Services Zeta Softech LPO, BPO IT Enabled Services Ascent Medical Transcription IT Enabled Services RF Arrays Hi-Tech, RFID IT Outsourcing Multiple innovative startups are mushrooming in the software product / platform space like Officebox and LocationGuru.Emergent Nagpur: An IT/ITES Destination Page 14 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  15. 15. WhitepaperVISIBLE INORGANIC GROWTHM&A’s in the recent Recent Acquisitionsyears indicate thatNagpur based •Persistent, a 5400+ strong global company,companies grow Feb 2011 acquisition of Infospectrum Headquartered at Nagpurinto best in classcompanies andbecome acquisition •Ebix, USA (Fortune 500 company) indirect acquisition of Premier Technology Grouptargets for global Oct 2009 at Nagpur through acquisition of EZ Data incorporations. USA •Cbay System, a UK based health services BPO, acquisition of Suyash Software - a Nov 2007 local medical transcription company among top 10 exporters •Induslogic, USA. now Globallogic a 4000+ Apr 2006 people strong company, acquisition of Lambent Technologies of Nagpur Key leverage points gained by acquisition of local companies  Cost advantage  Maintaining competitive advantage especially for talent acquisition  Expand to new markets by acquisition of customer base and Brand build- up & Brand build-upEmergent Nagpur: An IT/ITES Destination Page 15 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  16. 16. WhitepaperTALENT PROFILEWORKING PROFESSIONALSIT professionals Local IT Workforce – Export Oriented Units (registered with STPI)employed by localindustry are growing 3500 3320 3135 2523 FY2007-08 FY2008-09 FY2009-10 FY2010-11 • Avg. 3-5 years experienced talent • Industry attrition lower at 8% • Limited access to lateral talent because of still smaller industry size • Recession caused companies to slow down on hiring during 2009- 2010. IT Professionals employed by Domestic units • Apart from export oriented units, a significant number of workforce is employed in the domestic IT/ITES units. • An estimated number of 2000 are employed in the domestic unitsEmergent Nagpur: An IT/ITES Destination Page 16 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  17. 17. WhitepaperFRESH TALENTAvailability of fresh talent Engineers  40+ active Engineering Colleges (2012) with approx 12,000is abundant, global students graduating every yearrecruiters hire from  Significantly large number of students are from IT & Computer Engineering degreeNagpur Postgraduates & Polytechnics  Nagpur has 44 PG & has around 7 Polytechnic Institutes (2010) General  Around 27 colleges of Arts & Commerce which can be potential tap for BPO services (Nagpur has a neutral English accent), churning out 10,000+ graduates every year Multi-Nationals are recruiting • Major IT recruiters have visited the campuses in Nagpur to recruit mostly Engineers & Management graduates • Maximum salary for an engineer graduate was Rs.10.5 Lac per annum and average salary being 3.5 Lac per annum* • Top recruiters visiting Nagpur include Oracle, Microsoft, Infosys, HCL, Accenture, Cognizant, HSBC, Cybage, IBM, JP Morgan, and Mphasis. Neilsoft, Wipro, Patni, Sapient, Satyam, Capgemini, Tata, Tech Mahindra, Zensar, Cummins, Nvidia etc.TALENT IN ENGINEERING PROGRAMS 15A large pool of BE / BTech Degree Programs Intakeengineering students Chemical and related courses 252from variety of Electronics / Electrical courses 6540courses graduates Computers & IT courses 4590 Civil Engineering courses 1800every year. Mechanical Engineering 3060 Others 5040 Grand Total 1642215 pManifold Analysis, Directorate of Technical Education WebsiteEmergent Nagpur: An IT/ITES Destination Page 17 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  18. 18. WhitepaperIT /ITES INDUSTRY SUPPORT SYSTEM IT / ITES IndustryNagpur has a Support System at Nagpurdeveloped and Software Technology Parks of India (STPI) IT Parksevolving Support  Est. 1991System – IT Parks, 1  Incubation blocks at Parsodi (1500 sq ft each), 30 terminals per block. 1 Incubation block at Sadar with 12 terminalsemerging SEZ, various  Quick statutory clearances, quality infrastructure and LeasedIndustrial line connectivityAssociations, Private Software ParksTechnology User  Occupied: Lambent IT Park at Besa (occupied by GlobalLogic)groups etc which  Ready: Shapoorji Pallonji Infocity at MIHAN (one phase)  Upcoming: L&T IT Park & Empress City Mall IT Park, Nagpurmakes things easier  Announced: Mantri Group’s IT Park & DLF IT Parkfor companies and ITprofessionals MIHAN SEZ  Emerging business hub spread over 3454 hectares with stateemployed locally. of the art infrastructure, facilities and services  Claimed uninterrupted power supply, internet connectivity and water supply  Caliber Point and Ebix are already 2 operating cos. from MIHAN. Majors like TCS, GE, Microsoft, L&T, Patni and others are holding land, but move is awaited pending negotiations.  TCS & Infosys have recently announced their commitment. Vidarbha Association of Software Exporters (VASE) Associations  Established 1995; 50+ Members  Sharing best practices, offering solutions & bringing professionals together in IT industry  Seminar ‘Opportunity Nagpur’ and Destination Nagpur ‘ showcasing Nagpur IT jointly with Nasscom & VED  Networking dinners, sports, cultural events, social causes. Vidarbha Computer & Media Dealers Welfare Association (VCMDWA)  Established. 1991; 100+ Members  Restricts unfair trade practices, creates awareness on products, services and practices in IT  2nd best association in India as per DQ-ITC survey 2010. ‘Compex’ – Megaevent held every year in January since around 20 years Technology User Groups User Groups  A number of user or developer groups Linux User Group, Java User Group, Microsoft User Group, Open Source Groups including Joomla, Drupal, Netbeans.Emergent Nagpur: An IT/ITES Destination Page 18 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  19. 19. WhitepaperTYPICAL IT / ITES INDUSTRY SETUPSAlmost all exportoriented companiesare registered with Most home grown local companies have started using STPISTPI incubation and moved out into their own facilities 16Most large companieshave their ownbuilding infrastructureeither in the STPI IT Located 12km away from the city. Currently hosting a few 17Parks or their own companies. Key challenges include transport.land.Ready office space isavailable in new ITParks. Located in MIHAN, it offers all the benefits of operating in a SEZ. SP INFOCITY Nagpur is a notified SEZ of 100 acres. The total planned development in this project is approximately 7.7 Million square feet that will be spread across 24 buildings. Currently, one building (Building A1) and an incubation centre are ready for leasing and comprise a total area of approximately 18 2.5 Lac square feet. Custom built Quite some companies occupy privately owned, custom built space. Also, some of the real estate developers are able to provide managed office space. Regus office spaces are also now available at Nagpur16 http://www.mumbai.stpi.in/nagmemlist.asp17 http://www.madcindia.org/mihan.htm18 http://growit.in/nagpur-city/interviews/293-rajeev-shete-on-shapoorji-pallonji-infocity-at-mihan-in-nagpur.htmlEmergent Nagpur: An IT/ITES Destination Page 19 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  20. 20. WhitepaperBENEFITS OF OPERATING IN MIHAN SEZ 19Operating in an SEZ In terms of income tax benefits, SEZ unit lessees can avail of INCOME TAX BENEFITS benefits in the following manner:offers benefits over  1st 5 Years: 100% Exemptionoperating in non-SEZ  Next 5 Years: 50% Exemptionareas.  Next 5 Years: 50% Exemption on ploughed back profits However, if Letter of Approval (LOA) for establishing a unit in SEZ is obtained after 31st March, 2014, then income tax benefits will be investment linked (i.e. income tax exemption available only until capital investment incurred in setting up a unit has been completely recovered). Unit lessees in SEZs can avail of the following indirect tax INDIRECT TAX BENEFITS benefits: Supplies from Domestic Tariff Area (DTA) to SEZ are treated as exports and are eligible for export incentives  Excise duty Exemption  Customs duty Exemption  CST exemption  Service tax exemption/refund  Electricity Duty Exemption (subject to developer approval from State Electricity Board)  100% exemption of VAT payable on purchase of materials/supplies The following indirect taxes are non-exempt and have to be NON-EXCEMPT ITEMS incurred by unit lessees in SEZs:  Stamp Duty exemption currently not approved by Govt. of Maharashtra; waiver expected shortly  MAT of 18.5% of book profits payable from April 1, 2012  Dividend Distribution Tax of 15% payable19 http://growit.in/nagpur-city/interviews/293-rajeev-shete-on-shapoorji-pallonji-infocity-at-mihan-in-nagpur.htmlEmergent Nagpur: An IT/ITES Destination Page 20 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  21. 21. WhitepaperINFRASTRUCTURE COMMERCIAL OFFICE SPACE Commercial infrastructure at  Presence of Top Real estate Developers like KSL, Kalpataru, Rustomjee, DLF, Peninsula, Shapoorji Pallonji affordable rates is available Kumar Builders, Acme.  Managed Office Space is available through a number of local business centers including the global office space giant Regus.  Godrej Properties is among the recent entrants. NATIONAL & INTERNATIONAL CONNECTIVITY Central location and excellent  Nagpur is well connected by daily direct flights to all operated by Air India, Jet Airways, JetLite, Kingfisher, connectivity by air, rail and IndiGo, GoAir, SpiceJet. Air Arabia operates a tri-weekly road to and fro flight between Nagpur and Sharjah.  Nagpurs Air Traffic Control (ATC) is the busiest in India 20 with more than 500 aircrafts on domestic traffic from north to south and east to west and international routes such as Europe, Africa, South-East and East Asia passing over Nagpur air space every day.  21 Nagpur Airport is termed as the safest airport in India and hence is a prescribed location designated for all emergency landings as well. This is because Nagpur airport has both international and domestic terminals along with the availability of excellent fire-fighting equipment.  All major train routes and Roads pass through the city which is well connected to almost all the cities in the country  Nagpur is a major junction for roadways with National and State Highways  Presence of an International cargo base 20 http://articles.timesofindia.indiatimes.com/2008-12-17/nagpur/27916662_1_nagpur-airport-airport-director-landing 21 http://www.indianairports.com/php/showNews.php?newsid=555&linkid=17 Emergent Nagpur: An IT/ITES Destination Page 21 of 38 © 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  22. 22. WhitepaperUTILITIESPOWER SUPPLYHigh reliability Power supply  The city is a hub for power generation with excellent power infrastructurezone  SPANCO is operating the Power Distribution Franchisee for Nagpur city – Gandhibagh, Civil lines and Mahal division with a dedicated focus on distributing power efficiently.  Fewer outages as compared to other locations in MaharashtraWATER SUPPLYAs a one of a kind initiative,  Nagpur adjudged the `Best City in 2009 under the Jawaharlal Nehru National Urban Renewal Mission bywater supply utility has been union urban development ministry for its water supply 22privatized and services and projects implemented under JNNURM  The water supply to the city has touched a record 644implementation of 24X7 million litres per day (MLD) 23water supply is in progressTELECOM INFRASTRUCTURETop class telecom & Internet  Telecom and broadband connectivity through multiple independent service providers.connectivity from all major  Operators like BSNL, Reliance, Airtel, Vodafone, TATA,ISPs Tulip etc have strong and mature presence at Nagpur offering high quality services at competitive rates  3G services availableLOCAL GOVERNANCE - NMCNMC is a recipient of national  Nagpur is administered by Nagpur Municipal Corporation (NMC) which is democratically elected civic governing`Best Environmental Initiative body.award and National Urban  Nagpur Improvement Trust (NIT) works with NMC and carries out works like development of the civicWater Development award infrastructure and new urban areas on behalf of NMCfor the water supply servicesand projects2422 articles.timesofindia.indiatimes.com/2009-12-04/nagpur/28074195_1_water-supply-shashikant-hastak-uninterrupted-water23 http://articles.timesofindia.indiatimes.com/2011-12-29/nagpur/30568558_1_shashikant-hastak-water-supply-mld24 http://www.indiaurbanportal.in/AboutUs.aspx?id=68Emergent Nagpur: An IT/ITES Destination Page 22 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  23. 23. WhitepaperMAJOR INDUSTRIAL & COMMERCIAL HUBSIncluding non-IT centers of business. Commercial  Sadar  Jaripatka  Civil Lines  Empress mall  Capital Mall Asia  Poonam Chambers  Haj house  Medicine market  Itwari wholesale market  APMC Kalamna Industrial  Chikly lay out  Deputy signal  Small factory area  Uppalwadi  Kamptee road  MIDCEmergent Nagpur: An IT/ITES Destination Page 23 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  24. 24. WhitepaperRISKS Nagpur is one of the safest Catastrophic Risks  No major natural calamities reported. and low risk locations, best for  Lies in seismic zone II with low or neglible risk of business continuity. earthquake.  Very far from sea or ocean hence no risk of Tsunami. Political Risks  Political stability has endured over the last decade and ruling parties have completed their full term.  Legislative assembly is conducted every winter and is managed in a systematic and organized manner.  Nagpur has not been affected by communal tensions, rioting or terrorism so far History of Disruptions  Population is a mix of all religious denominations and has not been affected by communal tensions, rioting or terrorism so far. Emergent Nagpur: An IT/ITES Destination Page 24 of 38 © 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  25. 25. WhitepaperQUALITY OF LIFE AVAILABILITY OF HOTELS Ample hotels ranging from 1  Hotel Pride, Sun & Sand, Tuli Imperial among 5 star hotels Star to 5 Star spanning across  Larger brands including Radisson are coming up. category types budget,  Average occupancy rate of hotels is over 60% providing business, leisure, luxury and latent occupancy with business hotels having the highest occupancy rates. boutique to suit all types of  Facilities, ambience, service, food and other services at customers par with that in metros.  A delightful customer experience at competitive rates RESIDENTIAL ACCOMMODATION 25 Affordable housing in a The following table depicts savings in housing costs in Nagpur, clean, green and spaced Nagpur Bengaluru Hyderabad Pune out environment Rental (Rs./month) 1 BHK City Center 5,752 9,173 7,125 9,482 1 BHK Outside City 3,793 5,700 4,319 6,827 Center 3 BHK City Center 16,687 22,933 17,367 21,555 3 BHK Outside City 10,935 14,383 11,355 13,527 Center Outright Purchase (Rs./sq.ft.) City Center 6,198 7,724 6,632 7,354 Outside City Center 3,099 3,891 3,240 3,856  As Nagpur is one of the fastest growing cities, there is an enormous real estate activity with hordes of residential projects taken up.  Though Independent bungalows are preferred in Nagpur, demand for flats is also on the rise.  Empress City, Anandam, Jattarodi and Empyrean are some of the recent projects undertaken. 25 http://growit.in/nagpur-city/interviews/293-rajeev-shete-on-shapoorji-pallonji-infocity-at-mihan-in-nagpur.html Emergent Nagpur: An IT/ITES Destination Page 25 of 38 © 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  26. 26. WhitepaperCOST OF LIVINGDaily cost of living is relatively lowerThe following table shows a price comparison of essential and discretionary spending heads,Expenditure Heads Average Prices Relative to Nagpur Prices Bengaluru Hyderabad Pune Higher Lower Higher Lower Higher LowerGroceriesMilk (1 ltr.) 5% 14% 27%Eggs (1 Dozen) 7% 5% 10%Fresh Cheese (1 kg) 30% 10% 12%Chicken Breast (Boneless, 1 kg) 15% 25% 10%TransportationTaxi 40% 60% 7%UtilitiesInternet (6 Mbps, Flat Rate, Cable/ADSL) 27% 17% 20%Sports & LeisureFitness Club Membership (Monthly Fees) 185% 65% 58%Cinema Tickets (Single Adult) 17% 1% 13%LOCAL TRANSPORTATIONMost of the People in Nagpur  Self-owned vehicles constitute 60% of the local traffic at Nagpurprefer private mode of  Other means of local transport available are Buses &transport having their own Auto-rickshawsvehiclesCRIME RATEVery low crime rates, both in  According to Nagpur Police statistics, the number of crimes committed shows a steady decrease since last fiveterms of overall crime and years.crime against women  Strong surveillance by city and traffic policeEmergent Nagpur: An IT/ITES Destination Page 26 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  27. 27. WhitepaperPOLLUTION LEVELSNagpur is well known for  Clean and green roads with trees and parks around it and has natural and man-made lakes with Ambazari lakebeing one of the cleanest and being the largestgreenest cities in India  The city is surrounded by 3 famous Wildlife Sanctuaries, which are home for many wild animals including Royal Bengal Tiger.  Pollution levels are considerably lower than most of the cities in India.  The Nagpur Municipal Corporation plans to install electronic pollution display boards at 50 prominent squares in the city that will display information about temperature, humidity and carbon level of the city.ENTERTAINMENTMalls, Restaurants,  The city gives a relaxed lifestyle and leisure time to explore entertainment options.Multiplexes, Waterparks,  Restaurants and food joints serves all varieties of food.Weekend getaways, Picnic  Latest bollywood and hollywood movies are screened inSpots and various events multiplexes ad theatres across the city and all major film making units come to the city for promotionprovide ample options for  Satellite TV services are very popular at Nagpur with theentertainment major players being TATA Sky, Airtel, Videocon, BIG TV and SUN TV.  Plenty of picnic spots and weekend getaways in and around 1 hour commute timeEmergent Nagpur: An IT/ITES Destination Page 27 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  28. 28. WhitepaperLOCAL IT BUSINESS LEADERSURVEY RESULTS: NAGPUR ASAN IT DESTINATION? A brief survey of local IT/ITES Business leaders was conducted by pManifold in 2011 to assess the effectiveness of operating an export-oriented IT/ITES business from or at Nagpur. 26 IT business leaders belonging to a representative mix of small, medium and large IT/ITES companies responded to the survey. All top companies of Nagpur were represented. Most business leaders feel that fast and easy connectivity due to safe central location, good infrastructure, low cost of operations and an enriching lifestyle make Nagpur, a good destination for IT/ITES operations. Some key results are shared further. Emergent Nagpur: An IT/ITES Destination Page 28 of 38 © 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  29. 29. WhitepaperDOING BUSINESSMost business To what extent do you agree that your city is a good ITleaders agree that destination?Infrastructure isgood, should be Fast & Easy connectivity - Road,further upgraded; Rails & AirEasy connectivityand Low cost ofoperations makes Low Cost of OperationsNagpur a gooddestination Life Style Safer, Central positioning helps Business Continuity Infrastructure is good -5% 5% 15% 25% 35% 45% 55% Strongly Agree Mostly Agree Agree Somewhat Agree Dont agreeEmergent Nagpur: An IT/ITES Destination Page 29 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  30. 30. WhitepaperIMPACT ON MAKING SALESHaving a front end office Does having an office/presence closer to yournear to the customer i.e. customers location, e.g. in US or Europe, have any effect on Sales?US or Europe etc isconsidered good but notcritical 8% Yes. It Helps me get more business No. It doesnt 35% affect my Sales 57% Other How many times has your company lost a sale due to its geographical location at Nagpur? 8% Never 23% Rarely Sometimes 57% 12% OftenEmergent Nagpur: An IT/ITES Destination Page 30 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.
  31. 31. WhitepaperATTRITION AND TALENT INFLOWAttrition is less than Attrition in last 5 years10% and companiesare not only keen Above 50% 4%but are also able to 30% - 50% 0% Attrition Levelattract more talentfrom outside. 20% - 30% 19% 10% - 20% 15% < 10% 62% 0% 10% 20% 30% 40% 50% 60% 70% % of Respondents Number of employees that your company has attracted to Nagpur from outside the city in the last 3 years? 50+ 8% Number of Employees 20-50 8% 10-20 4% 01-10 62% 0 19% % of RespondentsEmergent Nagpur: An IT/ITES Destination Page 31 of 38© 2012 pManifold and/or its affiliates. All rights reserved. Whitepaper instituted by Spanco for release at Nagpur Calling 2012 – IT Conference.

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