Telangana pushes for investment in Tier II cities; Tech Mahindra, Cyient open centres in Warangal

IT companies Tech Mahindra and Cyient have opened new centres in Warangal, Telangana. The state's IT minister, K T Rama Rao, also known as KTR, said he was keen to get IT companies to invest in Telangana's Tier II cities and towns.

He said on Monday the state had taken its first step in that direction with Tech Mahindra and Cyient deciding to enter Warangal. Cyient, however, already had an incubation center in the city since 2016.

Speaking to Business Today, Rao, said: "Rapid urbanisation and focus on metros and A1 cities is causing severe stress on infrastructure and this is a problem with major cities across the country and not just Telangana. The strategy has to be to decentralise."

"A city like Warangal, which is a Tier II city but the second largest in Telangana , has all the ingredients (including availability of engineering talent)  to make it a successful business destination," Rao, who is the son of Telangana Chief Minister K Chandrashekar Rao, added.

"What we have achieved is a good beginning with facilities that will employ 1,000 people and grow manifold. Today, two large MNCs have entered - Tech Mahindra and Cyient. Right now, Cyient has built its own campus in five acres and Tech Mahindra has taken on lease the IT incubation centre that the government built there," he added.  

He pointed out that both centres had been opened "in a park that was spread across 45 acres".

"We are hoping that several other companies, including some of the smaller companies in Warangal will be based here. We also want to set up a Telangana academy for skill and knowledge and build on the innovation eco-system in Warangal by engaging with engineering colleges. This is because all Tier II towns cannot do without skilling," he said.

K T Rama Rao said there was a plan to ensure other Tier II cities in the state also receive investment.

"Next in line are Karimnagar, Khammam, Nizamabad and Mahbubnagar," he said. He is hopeful all five locations (including Warangal) will see activity over the next 18 months.

"It is time that the IT enabled services (ITES) be moved to tier II cities and towns and let the bigger cities and metros focus only on enterprises which focus on product innovation and emerging technologies. This will not just de-centralise development and growth but also de-congest large metros," he said.

Tech Mahindra's global delivery centre in Warangal is located at the TSIIC SEZ. The company has not disclosed the total investment in Warangal, but it is believed that the company's delivery centre in the city currently has a capacity of 100 employees.

"Tech Mahindra's collaboration with the government of Telangana to open up a new state-of-the-art delivery center in Warangal, is a step towards enabling the talented workforce in the tier -II cities to collaborate and co-create smart and sustainable solutions for the future by leveraging  next generation technology," said C P Gurnani, MD & CEO of Tech Mahindra.

Cyient's development center, according to the company, is the largest in Warangal.

"There are currently 300 people seated in the new campus and we will be adding another 300 in the course of coming months," B V R Mohan Reddy, executive chairman of Cyient told Business Today without sharing the quantum of investments made.

Asked about the kind of work that will be done at this campus, Reddy said: "It will be design of telecom networks. It is not a very low-end work."

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