Indian tech companies on the move to tier two cities?

In five years, 1.7 million jobs in the IT sector in India will move out of tier one cities like Bangalore, Delhi, Hyderabad, Mumbai and Pune, to tier two cities, Siddhartha Bhattacharya, CEO of Infopark has said.

Bhattacharya was speaking last week at a discussion organised by The Indus Entrepreneurs, a global not-for-profit organisation promoting entrepreneurship. Infopark at Kochi is a state government-owned IT Park.

It is the better quality of life and lower operating cost that are attracting the IT companies to these cities, he said quoting research reports.

Among the upcoming IT destinations, Kochi has many inherent advantages, he said.

He said: "The data transmission cost from Kochi is low. Seventy-five percent of the country's data traffic goes out from Kochi. VSNL has a 15GB gateway here. The electricity and water tariffs are one of the lowest among all the states. Compared to Bangalore, house rent is low in Kochi. The attrition rates in IT companies are below 10 per cent."

At present around 40 companies in the Infopark employ around 7,000 people. "In [the] next four years we expect the number of companies to go up seven to eight times."

He said that Kerala has the highest density of IT and science professionals. "The state's infrastructure is pretty strong, especially in telecommunication sector," he added.

Infopark is in the process of coming out with a dedicated incubator to help start up companies. Bhattacharya said: "This is an early life support system for start ups. We will help them with issues like government clearance, finance and also help them expand."

Original article: Tier 1 Indian cites to lose IT jobs to tier 2 cities from ZDNet Asia