Schubert: Making a point

Mumbai, Feb. 10: India?s Silicon Valley ? Bangalore ? is getting a bad rap from investors.

Siemens Ltd today joined a growing chorus against the city?s crumbling infrastructure when it said fresh expansions here would be put on hold as the state of its infamous roads was affecting employee productivity.

For Bangalore, the decision is a major setback as Siemens has unveiled big investment plans for India. It has announced a $500-million ?investment-led growth? strategy that will flow towards setting up new factories and expanding existing capacities over the next 3-4 years.

Siemens managing director Juergen Schubert fired the latest salvo against Bangalore?s infrastructure chaos when he told a news agency that the engineering giant would stop its expansion there as the road traffic was in a mess. He said employees were having to spend more time commuting to office and this was affecting their efficiency.

While the company has changed the reporting timings for its employees to 0730 hrs from 0845 hrs due to the city?s traffic problems, there is no respite on the expenses front as overall costs in the city are rising too.

Schubert?s attack follows similar statements made in the past by Infosys chief mentor Narayana Murthy, Wipro chief Azim Premji and recently by Biocon diva Kiran Mazumdar Shaw. They have all criticised the outgoing Congress government in the state for not doing enough on the infrastructure front.

But this is probably the first time that a company not headquartered in the city is joining the ranks of employers dissatisfied with the quality of infrastructure there.

Bangalore has around one-third (4,600 employees) of Siemens?s total employee strength whereas the southern region constituted around 45 per cent of the total employee strength (5,500 employees).

Apart from the manufacturing base for its automotive sector and servicing workshop for industrial turbines, it is a hub for telecom, medical and automotive software development and high-end research and development.

Alluding to the concerns expressed by Schubert, a senior official from the company said unless the infrastructure improves, Siemens would not expand further. ?We feel that the city will not be able to absorb much more unless its infrastructure improves,? the official added.

The leading software services major, Infosys, had in the past indicated that it would be looking at other cities which offer better infrastructure as travel time was increasing in Bangalore and also there was a shortage of land. Officials from Siemens, too, strike a similar note when they say that the company will expand in other cities like Calcutta, Mumbai, Pune and Chennai.

Siemens, it seems, has already set this process into motion. After announcing the setting up of a greenfield industrial steam turbine factory at Vadodara for Rs 30 crore earlier this month, Siemens is now acquiring an unit in Hyderabad.