Bangalore remains the hub of electronics industry due to its enviable infrastructure (2024)

. Raj Chengappa

Microprocessors being tested at Asea factory: New boom

Just when Bangalore seemed to be slipping from its pedestal of the 'silicon plateau' of the country, a flurry of private investment over the past two years has seen to it that its pre-eminence in the electronics industry will remain unchallenged. By last month the Department of Electronics had issued 125 letters of intent to companies, mostly private, to manufacture in the city a wide range of electronic goods ranging from personal computers to aircraft control systems.

Already 62 of them, with an investment totalling Rs 140 crore, have been moving quickly to set up units in the city and by 1990 an estimated Rs 800 crore of investment is likely to flow in. Predicts Managing Director S. Srikantan of the Karnataka State Electronics Development Corporation (KEONICS): "If the country's high-tech industry was born in Bangalore, then with all this investment it is likely to come of age here as well."

The list of private investors planning to move into Bangalore reads like a who's who of the chip industry. Hewlett Packard, the American computer giant, is tying up with Blue Star to set up a plant in the city which among other things will manufacture personal and mini computers. Almost rubbing shoulders with its project site is the British firm Sinclair, which is negotiating with Madura Coats and Macmillans for setting up a production unit for micro and mini computers.

And in the heart of Bangalore, Texas Instruments is setting up a 100-per cent export-oriented software unit for computer-aided design and manufacture. Just below its proposed office sits Asea, the Swedish giant which has already set up a Rs 5-crore unit and is manufacturing sophisticated electronic weighing machines and micro processors.

Bangalore is attracting the cream of the chip industry because of its proven record in the electronics field. With public sector giants such as the Indian Telephone Industries (ITI), Bharat Electronics Limited (BEL) and Hindustan Machine Tools (HMT) having established their key manufacturing units in the city two decades and more ago, it had already become the nucleus for electronics in the country. BEL, for instance, now accounts for a third of the semiconductors and half the television tubes produced in the country, while its Bangalore units account for 60 per cent of the telecommunications equipment.

Contributing to the city's growth are and were such key scientific and research establishments as the Indian Institute of Science, the Electronics and Radar Development Establishment, the Indian Space Research Organisation and the Aeronautical Development Establishment.

These qualities are now attracting the private manufacturers like bees to nectar. One reason why Hewlett Packard is moving in is because, as Marketing Manager Radha Basu says: "This city probably has the greatest concentration of professionally skilled labour for the kind of industry we are in."

Also, over the years Bangalore has built up an enviable infrastructure for the electronics industry, with more than a thousand ancillary units coming up to feed the public sector giants. As Asea Regional Manager Subba Rao says: "Here you don't need to make all the components under one roof. You could always get a local company to make some of the parts for you."

Bangalore also has some natural attractions. Its elevation gives it a uniformly cool climate throughout the year and keeps the atmosphere relatively dust-free. And employers find that engineers and scientists are willing to shift to the city at a moment's notice. Says Ashok Narasimhan, president WIPRO Systems: "Nobody wants to move to Bombay. Calcutta is really low on the list and Madras is regarded as too provincial. Bangalore is cosmopolitan and a perfect place to stay in."

The serious power shortage in Karnataka has not dampened their enthusiasm as most of the units do not consume much electricity.

Srikantan may be happy with this sudden burst of investment, but KEONICS, ironically, has nothing to do with it. Despite the advantages of having a ready infrastructure for electronics development, it has done precious little to promote growth. Instead it has behaved more like what a disgusted entrepreneur calls a "real estate agent". Although it decided to set up an electronics city on the outskirts of Bangalore almost eight years ago and provide land in it for 300 industries, so far only five major units have come up. Many of them are already complaining.

Tata Power Company, which is setting up a Rs 3-crore unit in the electronics city, now finds that there is no water available, KEONICS coolly told it to sink bo-rewells. However, the general feeling is that these problems can be solved. And with the Central Government liberalising its electronics policy, Bangalore is all set to cash in on the boom, KEONICS or no KEONICS.