Chandigarh, October 31
The IT sector in Chandigarh managed to survive the impact of the global recession, but growth in this sector has been stalled thanks to the Chandigarh Land Controversy. With allegations flying thick and fast over the allotment of land to IT companies in the Rajiv Gandhi Chandigarh Technology Park (RGCTP), no new IT major is willing to invest in Chandigarh.

Ever since petty politicking between the UT Administrator and the local Member of Parliament (MP) took centre stage, corporate confidence in the city as a preferred IT destination has been waning. In the past couple of months, IT biggies like Wipro have already postponed their plans to set shop in the city. In the past couple of months, no new IT company has come to the city. And this has nothing to do with the recession as IT majors have continued with investment plans in other cities like Noida, Jaipur and Hyderabad.

Sources in the IT sector say that because of politicking and controversy, Chandigarh is fast losing out to other emerging IT destinations like Jaipur. Not only have corporates lost confidence in the city, the officials in the Chandigarh Administration, too, are becoming over cautious about rules and procedures, thereby making it difficult for new entrants.

Ever since allegations of glaring inconsistencies and undue favours being granted to certain IT companies in allotment of land at RGCTP have come under the scanner, the IT biggies who had earlier announced their plans to set shop here, are now adopting a wait-and-watch policy. A recent audit by the Union Ministry of Home has held the UT Administration guilty of bypassing rules to allot land to certain companies. Officials in the UT Administration admit that they too have stopped persuading IT companies to invest in the city. “We are no longer proactively pursuing the companies to come here, for fear of being dragged in the on-going power tussle,” said a senior official.

A top official in Infosys, requesting anonymity, said that many other state governments are offering concessions and have better human resources for IT companies to set base and operate. “With such controversies, most IT majors prefer to shun a location, in favour of other emerging IT destinations. Corporates like to come to a place where there is confidence in the environment. Whatever the issue, the growth of the industry should not be affected,” he said. It may be noted that there are 40 companies, including Infosys, Tech Mahindra and Bharti Airtel that are operating out of the IT park here. These companies employ as many as 10,000 people. “The government here should have worked to promote the setting up of IT cluster as in Bangalore, Pune and Hyderabad. Not only has this controversy stalled future growth in IT sector, the insistence on set rules and procedures and red tapism in getting all approvals too would drive many companies away from the city,” said Ranjit Puri, the local representative of Tech Mahindra.