Bengaluru’s IT Dominance: The Silicon Valley of India

Bengaluru’s IT Dominance: The Silicon Valley of India
Bengaluru’s IT Dominance: The Silicon Valley of India

Introduction

Bangalore is the capital city of Karnataka and is one of the most important cities in India. It is well known as the Silicon Valley of India and is the IT hub of India. The city is a favourite for foreign investors, MNCs and Indian conglomerates, thus placing the city under the spotlight throughout the years. The city has also ensured that all the companies who have set up their bases there experience ample amount of infrastructural advantages and tax relaxations.

This is why 80% of all the massive global IT firms have their offices in Bangalore. Bangalore’s economic contribution is enormous and the city boasts of a GDP of $110 billion. The city’s GDP makes up over 87% of Karnataka’s total GDP. The Bangalore IT hub contributes the biggest chunk (34% to 40%) of the total IT exports of India. Bangalore has also been declared as one of the smartest (and most advanced) cities in the world by multiple organisations.

As a matter of fact, it is one of the top 30 smartest cities in the world in terms of technology and infrastructure. The city is only growing and getting better and experts predict that it will eventually overtake the original Silicon Valley which is located in the United States. As a matter of fact, it will become the largest IT cluster in the world, beating the likes of Berlin, Shenzhen, and other IT-centric cities.

Why is Bangalore the IT Hub of India?

Bangalore has been the IT capital of India for a while now, especially due to being the prime choice for foreign direct investments, local firms, MNCs, and startups. With the IT and ITeS revenue that is being generated in this city, the Bangalore IT industry has instated India as one of the top players in IT globally. But why exactly is Bangalore Silicon Valley so popular for companies around the world? Let’s take a look.

  • Mainly, the Bangalore IT hub area consists of multiple Special Economic Zones and software parks (IT parks). There are over 30 SEZs in Bangalore with dedicated zones for even aerospace and biotechnology industries. Most of these SEZs are built for ITeS and IT companies, thus, being highly desirable to most companies out there. It is easy to build their bases in Bangalore for these companies, especially with the existing infrastructure to support their interests.
  • Bangalore also provides 24/7 unrestricted power to its SEZs and IT parks in order to support the various operations of these companies without any failures. This makes it very easy for companies to make the transition and become operational as soon as possible. Bangalore is infrastructurally very advanced and this also attracts these companies from around the globe and the city has the office space to support their never-ending requirements. There are plans for making more upcoming IT hubs in Bangalore and near the city as well.
  • Secondly, the huge advantage companies get out of setting their offices up in Bangalore is the massive amount of skilled manpower. This is especially useful for MNCs and local giants who wish to set up offices with hundreds of employees. There were over 15,00,000 skilled IT professionals in this city previously and the number is expected to reach 80,00,000 soon. This is a huge amount of human assets that companies can employ and incorporate into their projects.
  • This makes it even more alluring for employers around the world to come to this city looking to set up their offices. A huge number of software engineers are also willing to relocate to this city, thus making it even easy to get access to all the manpower with special sets of skills. All of this makes it easy for companies to blend in easily and prioritise Bangalore over any other city in India. As a matter of fact, it is probably more alluring to employers than any other city in the world currently. This is because of the cheaper manpower they can employ in India as compared to cities such as Berlin or other US cities.
  • Bangalore is very organised and advanced in more ways than one. Not just due to the infrastructure it showcases but also due to the massive growth and sustainability it has shown to the world. The city has been declared as the most dynamic city in the world by the City Momentum Index.
  • The World Economic Forum has also agreed with these kinds of statements about Bangalore multiple times throughout the years, especially when it comes to the viability of Bangalore as a city of the future.
  • Companies such as Google, Microsoft, IBM, TCS, Amazon, Wipro, Accenture, Infosys, KPMG, HP, Dell, Siemens, Cisco, Capgemini, Cognizant, Goldman Sachs, Deloitte, EY, Intel, Oracle and SAP, all have their offices set up there. As a matter of fact, a lot of them have their Indian head office there. There are also many other companies such as Samsung, Huawei, Nokia, Phillips, Tech Mahindra, Hitachi, HCL, Flipkart and CGI that also motivate other smaller firms and local giants to come to Bangalore.
  • Bangalore is the root of the startup culture that has taken over India in modern times, most of the startups in this country emerge from this city and companies such as Zoomcar, Groww, Swiggy, RazorPay, Dunzo and Oyo are all from Bangalore. There are over 13,000 operational startups in Bangalore and there are more startups emerging from this city annually than anywhere else in the world.
  • There is an ample amount of academic institutes and engineering colleges in Bangalore that make it easier for both employers to get employees and students to get jobs out of college. There are also multiple training institutes for technical skills as well in this city.
  • Bangalore has many relaxations on tax and export/import duty fees for companies that are registered for the special IT and Software Park schemes. STP schemes allow companies to operate effectively without paying heavy taxes and incurring other expenses. The Government of India and even the State Government of Karnataka provide multiple opportunities for startups and local firms as well when they are setting up shop in Bangalore. There are also heavy relaxations that companies experience when importing hardware to support business activities in Bangalore.

Frequently Asked Questions

Why is Bangalore called an IT hub?

It is called the IT hub of India as the city is home to the highest number of IT professionals in India and has 80% of the global IT companies operating in the city.

How did Bangalore become the IT hub of India?

It became the IT hub of India due to the immense economic contribution it has been making for a long time. It contributes to more than 34% of India’s IT exports.

Which is the biggest IT hub in India?

Bangalore is the biggest IT hub in India. You can check more information about the biggest IT hub in India by checking the Bangalore IT hub wiki.

Is Bangalore the next Silicon Valley?

Yes, it has been predicted that it will overtake the original Silicon Valley as the largest IT cluster in the world.

Why Bangalore is called the Silicon city of India?

It is called so due to it being the IT capital of India and being home to the largest number of local conglomerates and IT MNCs.

Which areas in Bangalore have the most IT companies?

Whitefield, JP Nagar, Koramangala, and ‘Electronics City’ have the highest number of IT companies in Bangalore.

What is Bangalore’s GDP?

Bangalore has a GDP of $110 billion.

Is Bangalore’s IT hub better or Hyderbad’s IT hub?

Bangalore’s IT hub is larger and more extensive in nature. Bangalore is also one of the largest IT clusters in the world and is ahead of Hyderabad in many areas.

Is Bangalore cheap to live in?

No, it is not exactly cheap to live in, especially when compared to cities such as Hyderabad, however, IT professionals across the nation are more than willing to shift here to work with the biggest companies in the world.

Key Takeaway

More than 50% of the population in Bangalore are migrants, this only reinstates how popular the city is for people from all corners of our nation. This also stands true for companies from various countries around the world. Countries from Germany, the US, UK and many more all come to Bangalore looking to set up their operations in this city to effectively run their business processes while incurring lesser expenses.

Bangalore is a favourite for outsourcing and it is also extensively popular for its KPO and BPO industries as well. It is one of the top IT cities in the world and definitely the IT capital of India. Bangalore will only grow as a city and as an economy, dominating the IT and ITeS industry globally.