Economy of Bangalore
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Bangalore or Bengaluru, the capital city of South Indian state of Karnataka, India is the largest industrial and commercial center of South India[1] and is the third largest industrial and commercial center of the country. The economy of Bengaluru contributes over 43.65% to the economy of the State[2] of Karnataka, accounting for 98% of the Software Exports of the State.
The establishment and success of
The estimated Metro GDP (PPP) of the city is around US$300 billion, with a Metro GDP (PPP) Per Capita of roughly US$25,461 in 2022. It has been ranked as the third most productive metro area in India.[6][7] According to the estimates, Metro GDP (PPP) of the city has grown to US$320.1 billion in 2023.[8]
One of the important factors spurring Bangalore's growth was heavy state government investment (and its environment) in Bangalore's public sector industries which is what makes it so developed and rich.
According to the Bangalore Innovation Report, with projected GDP growth of 8.5%, Bangalore will be the world's fastest growing city until 2035.[9]
Education
Bangalore houses several of top-tier colleges including the
Economic sectors
The earliest startups that were launched in the city in the 1990s include Infosys, Wipro Technologies, and Mindtree being popular ones and smaller ones include Tejas Networks. Flipkart, having originated in Bangalore, acquired several other e-commerce companies in Bangalore like Myntra, and was eventually acquired by Walmart in 2018 for close to $20 Billion. Startup companies such as Swiggy, Ola Cabs, InMobi, Quikr, and RedBus are also based in the city.
Bangalore is a favorable destination for industrial development.
Information Technology
Bangalore is firstly known for its IT industry. It houses many IT Companies. Here are many IT companies like Infosys, Mphasis, Wipro, Tata Consultancy Services, Nasdaq, Facebook, Google and Microsoft etc. India's two largest IT companies – Infosys and Wipro to name a few have their headquarters here in Bangalore. Electronic City is a place in Bangalore, which houses IT companies in Bangalore along with Infosys headquarters. Whitefield is another major suburb housing many IT companies. It is called as "The Silicon Valley of India' and "IT Capital of India".
Aerospace and aviation
Bangalore is also called the aviation monopoly capital of India. It accounts for more than 65% of India's aerospace business. World Aerospace giants such as Boeing, Airbus, Goodrich Archived 6 June 2013 at the Wayback Machine, Dynamatics, Honeywell, GE Aviation, UTL, others have their Research & Development and Engineering centres in Bangalore.
Before Bangalore was called the Silicon Valley of India, the city made its name as headquarters to some of the largest public sector heavy industries of India. The Hindustan Aeronautics Limited (HAL) headquarters is in Bangalore, and is dedicated to research and development activities for indigenous fighter aircraft for the Indian Air Force. With over 9,500 employees, it is one of the largest public sector employers in Bangalore.
Today, HAL manufactures, under license, various fighter aircraft for the Indian Air Force (IAF) including Sukhoi 30 Flankers and Jaguars. HAL also develops indigenous products for the IAF such as HAL Tejas, Aeronautical Development Agency, HAL Dhruv and HAL HF-24 Marut.
The
A 1,000-acre (4.0 km2) special economic zone for the aerospace industry is being set up near the
Biotechnology
Biotechnology is a rapidly expanding field in the city. Bangalore accounts for at least 97 of the approximately 240 biotechnology companies in India. Interest in Bangalore as a base for biotechnology companies stems from Karnataka's comprehensive biotechnology policy, described by the Karnataka Vision Group on Biotechnology.[18] In 2003–2004, Karnataka attracted the maximum venture capital funding for biotechnology in the country – $8 million. Biocon, headquartered in Bangalore, is the nation's leading biotechnology company and ranks 16th in the world in revenues.
Institute of Bioinformatics and Applied Biotechnology (IBAB), initiated by Biotechnology vision group, ICICI and Biocon (located at ITPL) is trying to shape revolutionary scientists in the field.
Like the software industry which initially drew most of its workforce from the local public sector engineering industries, the biotechnology industry had access to talent from the National Center of Biological Sciences (NCBS) and the Indian Institute of Science (IISc).
Manufacturing
Other heavy industries in Bangalore include
Bangalore is also becoming a destination for the automotive industry. Volvo and many other auto suppliers have manufacturing plants in Bangalore.
Bangalore houses many small and medium scale industries in its Peenya industrial area that claimed to be one of the biggest in Asia 30-years ago; newly including Apple's India manufacturing plant – the only active plant in the world outside of China.[19]
Other sectors
The city has several types of entrepreneurial pursuits that have shaped it along the way from the early '90s. The city is known for several restaurateurs who innovated on fast service models commonly called Darshini restaurants that served hot breakfast and beverages. Orkla Foods, the Norwegian foods company bought MTR Foods, traditional ready-to-eat consumer goods brand in 2007 for approximately $60m.[20] A recent $100m brand is ID foods, fast becoming popular in retail. Swiggy an on-demand food delivery Unicorn is popular along with Zomato, a restaurant review, listing and food delivery business, that initially started in Bangalore. FreshMenu is a near-unicorn cloud kitchen business that only delivers via mobile apps and other on-demand food apps. Cafe Coffee Day, a listed entity is a coffee store chain with stores in Prague, Bratislava, Riga and Warsaw. Chai Point is a chain of tea stores founded in Bangalore in 2010.
Several Venture Capital funded startups like
India's largest indigenous OEM, Hindustan Aeronautics Limited (HAL) had its headquarters in India. Several smaller tier 1 and tier 2 suppliers had their base in the city to serve the OEM need. The National Aerospace Laboratories (NAL) is also headquartered in Bangalore and is dedicated to the development of civil aviation technologies. Bangalore also housed now-defunct full-service airline brand Kingfisher Airlines, which acquired another airline startup, Air Deccan, a budget airline.
The
Bangalore is the home of India's first electric car brand,
BigBasket.com, Zopnow.com and Zopper.com, started in on-demand grocery and compete with Amazon's Prime Now platform. Offline, formal retail format grocers originating from the city include
Urban Ladder is a leading omnichannel commerce furniture retailer founded by entrepreneurs from the city. Lifestyle, now part of Dubai-based Landmark group originated as a brand in Bangalore in 1999. Tanishq is a jewelry retail store brand and is owned by the Tata Group. Printo is a chain of stationery and printing services stores.
Several fintechs have their origins in the city. The revolutionary low-cost brokerage firm Zerodha, several cryptocurrency exchanges. Pine Labs is a recent unicorn that builds POS systems. Capillary Technologies is a loyalty, analytics provider built over POS systems. QwikCilver, a gifting and loyalty platform founded in Bangalore was acquired by Amazon.[22]
The city is known for its craft breweries, popular ones being Toit, Arbor Brewing Company and others. Kingfisher is one of the world's largest beer brands that originated in Bangalore. Amrut is India's first Single Malt Whisky brand that is sold all over the world and was named as the number three whisky in the world in 2010. United Breweries Group has its headquarters in Bangalore. It produces Kingfisher (beer).
Wildcraft, a fast-growing outdoor adventure goods company was founded in the city. Zivame is an online commerce lingerie company fast growing into the number 1 brand in India.
Narayana Hrudayalaya, a listed business, is a popular hospital chain that was built by renowned Bangalore cardiac surgeon. Portea Medical and Practo are some of the fast-growing startups in the space. Cloud Nine is a chain of fast-growing maternity and childcare brands founded in the city in 2007.
DTDC is an asset light logistics company built by first generation entrepreneurs in the city.
Lucia is a Kannada movie that is renowned as India's first crowdsourced movie. The movie was extensively shot in Bangalore.
There are many sports facility aggregators where consumers can book indoor courts or swimming pool slots like Playo. Many entrepreneurs are setting up sports facilities due to higher interest in fitness. There is a fitness chain called CureFit, invested in by early entrepreneurs and restaurants attached like EatFit.
Many wine yards are springing up around the city due to interest among a globally aware community of people residing in the city. Bangalore is also India's largest export of roses, about 70% of all rose exports come from the city.
Samsung Electronics in 2018, opened Largest Mobile Experience Centre in the World at Bengaluru's Iconic Opera House. Samsung Opera House will be a must-do destination for the city's millennials looking for exciting tech-enabled experiences and entertainment. One will be able to enjoy VR experiences such as the 4D Sway Chair or the Whiplash Pulsar 4D chair that makes 360 degrees three-dimensional movements. One can slip into the role of a fighter pilot doing extreme aircraft stunts, or experience a space battle, or a roller coaster ride. The 33,000 sq ft standalone property, which during the British era hosted plays and Operas, has been restored over two years and its facade continues to don its magnificent original look and feel. On the inside, a modern experiential space has been developed with extensive use of modern technology.
Economic zones in the city
There are several economic clusters, as in many cities in the world, in the city.
- Chickpete area is known for textile trades and early entrepreneurs in the city
- Shivajinagar area houses auto spares and services clusters
- Whitefield was a neighboring town to Bangalore, but over time has been assimilated into the city. Whitefield houses several Information Technology Parks and many global firms have their India headquarters located in the area.
- Koramangala and JP Nagar have traditionally been the area where tech startups take birth
- Electronics City houses all the major IT service providers of India
Government incentives and programs
Tax holiday for IT services: The Government of Karnataka was the first state government to introduce a tax holiday for IT service companies to set up shop in the city to earn a decade-long corporate tax holiday to incentivize the industry.
IT SEZ program: Server IT Special economic Zones are now set up where they receive a corporate tax holiday if offices are situated in those zones.
Ministry of IT: One of the early states in India to have a Ministerial position for
Adoption of Technology in Government programs: Multiple government initiatives have included digitization of citizen programs and Karnataka has been at the forefront of adoption of technology. The Regional Transport Office in the city are fully computerized and they the earliest to do so. Bangalore also achieved full computerization of the Indian Passport Distribution process, first in the country.
The digital office of the Income Tax Department of India is based in Bangalore. The need for the build of systems to collect and refund taxes for millions of citizens and need for data analytics and AI to prevent fraud meant that Bangalore city was an obvious choice for the same.
See also
References
- ^ "Gross domestic product (GDP) of major cities in India in 2022". Retrieved 26 March 2024.
- ^ ROTTI, JOLAD (10 September 2013). "Bangalore the main revenue generator for Karnataka". karnataka.com. The Times of India Sept 9 2013. Retrieved 21 May 2018.
- ^ "IT employee strength to rise to 4.8mn this year". The Times of India.
- ^ "IT employees get nod to set up trade union in Karnataka".
- ^ "'Bangalore will become the world's largest IT cluster by 2020'".
- ^ "Deep Dive City Bangalore, India" (PDF). Transformative Urban Mobility Initiative. Retrieved 9 January 2024.
- ^ "Fastest Growing Cities". The Times of India. Retrieved 30 August 2018.
- C40 Cities. Retrieved 9 January 2024.
- ^ "Bengaluru to be world's fastest growing city". Deccan Herald. 23 January 2020. Retrieved 9 January 2023.
- ^ Pendharkar, Aditi Dey & Anish. "Map: How Bangalore's IT sector flowered from a princely state Diwan's industrial dream in 1911". Scroll.in. Retrieved 27 May 2022.
- ^ John, Sujit (22 June 2006). "UB City is finally here". The Times of India. Archived from the original on 6 November 2012. Retrieved 6 April 2009.
- ^ "Indian Automobile Market in Bangalore- companies and more". business.mapsofindia.com. Retrieved 16 August 2021.
- ^ Rai, Saritha (15 February 2021). "Tesla comes to India, picks EV hub Bengaluru for its first plant". ThePrint. Retrieved 16 August 2021.
- ^ Kulkarni, Mahesh. "Karnataka to be the second biggest auto hub in the South". Rediff.com. Retrieved 16 August 2021.
- ^ "5 Times Bengaluru proved it's India's R&D hub". makeinindia.com. Retrieved 16 August 2021.
- ^ "Karnataka – Aerospace Hub of India". PricewaterhouseCoopers. Retrieved 16 August 2021.
- ^ "Hosur being positioned as a hub for electronics manufacturing". Deccan Herald. 7 January 2022. Retrieved 27 May 2022.
- ^ "Bangaloreit.com". Bangaloreit.com. Retrieved 15 August 2013.
- ^ "Karnataka welcomes iPhone SE manufacturing in Bengaluru".
- ^ "Orkla confirms MTR buy – Livemint". livemint.com. Retrieved 21 November 2018.
- ^ "India's Record-Breaking Launch: 104 Satellites on One Rocket", The Wall Street Journal, 15 February 2017, archived from the original on 19 December 2021 – via YouTube
- ^ Nair, Radhika P. (28 October 2014). "Amazon to buy first Indian start-up QwikCilver Solutions, a gift card tech firm". The Economic Times. Retrieved 21 November 2018.