Having excluded union territory-turned states Delhi and Goa from the overall state competitiveness rankings, it was impossible to ignore the National Capital Territory (NCT) Delhi or rather the bigger whole that is the National Capital Region. The NCR is unique because of the intensity of population and its huge purchasing power as well as the agglomeration of businesses. The NCR is as critical to Delhi as it is to the neighbouring states of Haryana, Uttar Pradesh (UP) and Rajasthan. The NCR must succeed if India has to succeed as a competitive nation. After all, the region contributes about 4 per cent to India’s gross domestic product (GDP), with tax collections contributing 15 per cent of the total, according to analysts. And NCR as a whole is able to do what Delhi has failed to till now — generate enough economic activity to utilise the resources available, and attract investments. According to the Haryana government’s website, there are more than 400 large-and-medium-scale units in Gurgaon that attracted investments worth about Rs 9,000 crore in 2006-07 and around 8,000 small-scale units which brought in Rs 900 crore

1. The NCR is emerging as the most
important business centre of the
country
A Business World article with Inputs from Indicus Analytics
PROFILE
Busy With Business
The NCR is emerging as the most important business centre of the country
M. RAJENDRAN
13 Feb 2009
Having excluded union territory-
turned states Delhi and Goa from
the overall state competitiveness
rankings, it was impossible to
ignore the National Capital
Territory (NCT) Delhi or rather the
bigger whole that is the National
Capital Region. The NCR is
unique because of the intensity of
population and its huge purchasing power as well as the
agglomeration of businesses. The NCR is as critical to Delhi as it
is to the neighbouring states of Haryana, Uttar Pradesh (UP) and
Rajasthan. The NCR must succeed if India has to succeed as a
competitive nation. After all, the region contributes about 4 per
cent to India’s gross domestic product (GDP), with tax
collections contributing 15 per cent of the total, according to
analysts.
And NCR as a whole is able to do what Delhi has
failed to till now — generate enough economic
activity to utilise the resources available, and attract
investments. According to the Haryana

2. government’s website, there are more than 400 large-and-
medium-scale units in Gurgaon that attracted investments worth
about Rs 9,000 crore in 2006-07 and around 8,000 small-scale
units which brought in Rs 900 crore.
The intensity of competition among state governments within the
NCR is exciting. “The competition is intense particularly among
the two states to grant fast approvals and clearance in places,
adjoining the border with NCT,” says Amit Sinha, president of
Indicus Analytics, a Delhi-based research firm.
Sample this: the annual turnover in the Gurgaon industrial sector
crossed Rs 45,000 crore in 2006-07 with investments of more
than Rs 10,000 crore. It is estimated to be in the region of Rs
75,000 crore at the end of 2008. Both Greater Noida and Gurgaon
have succeeded in attracting big names such as Accenture, Dell
and Samsung. UP and Haryana governments have been rolling
out the red carpet for automobile, IT and ITeS, and fast-moving
consumer goods (FMCG) companies.
The investments in NCR is also a reflection of Delhi’s
geographical proximity — its rail and air connectivity is the best
in the country. And this is the muscle that Delhi flexes to bargain
with other states, in the absence of any major investments of its
own. “The agenda of National Capital Region Planning Board are
predominantly Delhi-centric, with other members planning their
policy around it,” says a senior bureaucrat from Haryana, who did
not wish to be identified.
Human resource — this is another area for which the NCR is
largely dependent on Delhi. Top industries and offices in Gautam
Buddha Nagar — that includes New Okhla Industrial
Development Authority (Noida) and Greater Noida in UP — and
Gurgaon and Faridabad in Haryana get their top executives from
Delhi. More than 200,000 people are employed in the Gurgaon
industrial area alone. Even some entrepreneurs have been pushed
out of Delhi for lack of space. “Entrepreneurs in the services
sector from places like Karol Bagh wanted to expand and have

3. shifted base to Noida and Greater Noida, while those in
manufacturing have moved to Faridabad,” says Arup Roy
Choudhury, chairman and managing director of National
Buildings Construction Corporation (NBCC).
One of the reasons, analysts say, for such a trend is better
education opportunities in Delhi compared to UP and Haryana —
as it boasts more than 100 professional colleges and three major
universities along with an
Indian Institute of
Technology (IIT).
“Those who moved to
Delhi for work and better
schooling for their children,
continued to stay, like us, Fast Track: The extension of the metro rail from
even if the work moved Gurgaon to Noida will add value to NCR
(Pic By Amit Verma)
out,” says Kapil Dev
Kumar, chief operating officer of Gurgaon-based SMART
Digivision. He stays at South Extension in Delhi, with his wife
Bhawna, professor at Amity International Business School, who
travels to Noida every day.
To make up for this drawback, Greater Noida and Gurgaon have
been fighting to become ‘the’ big destinations for IT and ITeS
companies such as business process outsourcing (BPO) firms. To
take IT to the masses, Noida and Greater Noida authorities plan
to introduce wi-fi facility. This would entail making all schools,
colleges, institutions, hospitals, hotels, malls and other business
establishments wi-fi enabled — to provide complete wireless
network facilities to students and professionals in the area.
The two districts have also found an answer to Delhi’s inability to
offer affordable housing. The opportunity was grabbed by major
real estate players such as DLF and Unitech.
While Noida and Gurgaon are helping Delhi de-congest, some
analysts say it could be detrimental for the city’s identity. “It
would make Delhi less competitive and bereft of talent and life as

4. many western cities,” says Anshuman Magazine, chairman and
managing director of CB Richard Ellis, a leading real estate
consultants. “Even if industries cannot be allowed to grow due to
pollution, the government can create specialised zones for IT and
Ites companies in Delhi.”
“Not many understand that the
development of satellite towns by
state governments is to attract
foreign investment to those
regions, and not act as a support
region to Delhi,” says NBCC’s
Roy Choudhury. Delhi is primarily
a services industry hub with more
than 90 per cent of the workforce
engaged in services.
The Haryana and the UP government meanwhile continue to
lobby with the Centre for better connectivity with the capital. The
plan to extend the Metro to Noida and Gurgaon is an indication of
the success of their lobbying. This is not just to support
movement of people and goods from and to Delhi, but also to
enhance the value of the satellite towns.
m dot rajendran at abp dot in
(Businessworld Issue 17-23 Feb 2009)