Should Karnataka review IT land allotment?

ASHWINI A. writes from Bangalore: The Andhra Pradesh government, according to a report in today’s Deccan Chronicle, has decided to stop rolling out the red carpet for Information Technology companies, as far as allotment of hundreds of acres of land goes.

Instead, the IT companies will be asked to put up units in existing IT Special Economic Zones.

“We suspect that some of the (IT) applicants have real estate interests and we are not going to encourage that,” an unnamed senior official has been quoted as saying.

“Small and medium enterprises need to invest huge amounts for bandwidth, network and connectivity, which they cannot afford in the initial stages,” said IT&C Secretary Shailendra Kumar Joshi. “They will get all these facilities on rent or lease in SEZs.”

Just what the provocation is for the move at this juncture is not known. Is it a fallout of the SEZ controversy in Nandigram and Singur? Is it a realisation that some IT companies have barely concealed real estate intentions? Or is it plain posturing on the part of the Andhra government?

More importantly, is it a case of locking the stable doors after the horses have bolted?

The Chronicle report suggests that some of the IT companies in that State were using land for arbitrage, especially in the so-called Tier-II and Tier-III cities. “Out of the 36 units which were given land in Vizag, 20 units started work only after the government threatened to take back the land,” Joshi is quoted as saying.

Should AP Govt’s decision be some sort of alert for other state governments? Should Karnataka, for instance, do a review of the land allotted to various IT companies in the past six years or so and see if the land has been used for the purpose they were meant for?