VIEW FROM WITHIN - Telangana flames are branding Cyberabad (By SRIVATSA KRISHNA)

==James the land Louis XIV taught that the King could do no wrong, and their success or lost their heads; Hegel and his disciples taught that the State could do no wrong, and plunged the world in to war; Our doctrinaire democrats teach that the majority can do no wrong, and they bid fair to wreck our civilization completely.==== The pro and anti-Telangana agitators should remember these wise words of philosopher WW Inge,for by trying to wage out a bloody war in the name of the majority,the only certainty they are ensuring is the slowdown,nay even disappearance of investment,away from Hyderabad.Indeed,the majority is not always right. Absence of emotional integration and the expression of the voice of the people are unarguably reasons to consider while looking at creating a smaller state,with perhaps a lot of merit,but then if one looks at just data on the impact on investment,it tells quite a different story. The Cyberabad investment cluster is a rare achievement and is a product of an extraordinary public-private partnership. Prior to 1996,Andhra Pradesh,which has an extremely rich and vibrant culture,was never known as a global investment destination.Thanks to an extremely aggressive,measured government intervention,the Cyberabad Municipality was built brick-by-brick and it went on to become the home for Microsofts only offshore development center outside Redmond,Seattle,and development / back office centers for Google,Amazon,GE,HSBC,Oracle to name just a few.This apart,it is also one of the foremost bulk drugs and pharma hubs of India,and the institution-capital of India,with several national level training institutions being located in this cluster.Michael Porter analyzed it in a Harvard Business School study and it was showcased by BusinessWeek, Gold-man Sachs,The Economist and many others as one of the marvels of modern India. The reason for this was simple Hyderabad became not just a preferred investment destination of Asia but also one of the best cities to live in,which in turn made young people from all over the country pick it as their preferred habitat.Lets look at just one metric,namely exports from the Hyderabad IT cluster. In 1995,it was Rs 60 crore,which went to Rs 2907 crore (in 2001) and onto a whopping Rs 33,482 crore in 2010! The number of companies rose from 31 in 1995 to 1080 in 2010 in the Hyderabad SEZ.Most importantly employment,especially among the middle class and lower middle class youth,grew from 64,000 in 1995 to 2.5 million in 2010. Less than two decades later,politics and the Telangana agitation are rapidly ensuring that investors shun Hyderabad as an investment destination.JP Morgan booked an entire building in Raheja Mindspace complex only to return all but two floors,worried about the agitation and its impact.Bank of America,facing layoffs in the US,was expanding its India operations as an unintended consequence and benefit,and had planned 9000 jobs for Hyderabad,but decided to cap it only at 3000 and shifted the rest to Gurgaon.ICICI,which promised the state government that it would setup 20,000 jobs,many for young graduates such as those at the forefront of Telangana agitation,has decided to not expand beyond about 5000! Amazon,partly for reasons of uncertainty due to the ongoing agitation and partly due to issues over land title,has not taken possession of ten acres of land,where it had planned to expand. What a sad irony,for it will hit those who are at the heart of this agitation the hardest by the loss of these jobs so vital for the growth of the economy in Hyderabad. The agitation for a separate state has many credible sociolo-gical, emotional and development factors,many of which are legitimate,some others not so legitimate.The key question, while looking at the narrow issue of its impact on brand Cyberabad and attendant investments,is whether the current slowdown,nay even flight of investment,is temporary or permanent. The fact remains that largely for reasons of wanting to create pure political employment and its attendant spoils of office,in the name of the people (which is the standard operating procedure for committing many a crime in a democracy),Hyderabad as an investment destination appears to be rapidly going the canine way and its no wonder that it is perhaps the only mega city in the world where a majority,if not all,buildings have meshes around them to prevent damage to assets.The permanent asset,namely Brand Cyberabad,is rapidly fading away from the global investment map. (Source-toi)

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