– a saga of transformation of a remote region in AP.
“Backward to smart”
Satyavedu, a typically backward in every sense, within a period of just ten years, turned into a region of bustling activity offering employment opportunities for over 40,000 people. It has become a reality with the advent of Sri City, an integrated business city in this area.
In just 10 years, the Satyavedu region, in which Sri City is now located, has grown from a barren and backward in every sense into one of the most preferred investment destinations, boosting local manufacturing, giving a fillip to creation of jobs and getting the economy of the region on a fast track.
Sri City, a world-class Integrated Business City, located at the Southern end of Andhra Pradesh, completes a dynamic decade of operations.
Sri City, spread in an area of 100 sq km area in the Eastern end of Chittoor district, comprises a Special Economic Zone (SEZ), a Domestic Tariff Zone (DTZ), Free Trade Ware housing Zone (FTWZ) and an Electronic Manufacturing Cluster (EMC), all in its precincts. Its gateway lies along the NH-16, near Tada town in Nellore district, and the business/Industrial/leisure/residential zones are all spread in the Varadayyapalem and Satyavedu Mandals of Chittoor District.
Sri City offers everything, what a business needs – right from robust infrastructure for manufacturing and services to support amenities and lifestyle facilities.It was designed as a world-class city based on the ‘new urbanisation’ concepts of integrated development that can lend itself to scalability and sustainability in the future. Taking advantage of the large workforce, talent pool, and well-developed best-in-class industrial industrial infrastructure, Sri City stands as glittering example of industry extraordinaire.
Its proximity to Chennai, the business and commercial hub of South India, gives Sri City a competitive edge over other locations. Sri City’s strategic location offers access to the best of both states. In recognition of its world class infrastructure, international standards and commitment, Sri City received several prestigious awards, including the Asia’s Most Admired Brand for 2017-18, and Indian Green Building Council’s (IGBC) prestigious Green City ‘Gold’ rating in recognition of its excellence at national level in 2017.
From concept through commissioning
Mr Ravindra Sannareddy, an established industry-captain who leveraged his international academic background and experience to create successful trans-continental business organisations, had realised that India was losing investment opportunities from foreign due to lack of infrastructures. After a lot of brain storming, he determined to develop an industrial hub in Andhra Pradesh, which will be like Shenzhen in China, Jurong Industrial Estate in Singapore, Columbia in Maryland and Cyberjaya & Putrajaya in Malaysia. In 2006, in association with his friends and Equity funds, Mr. Sannareddy established a company titled ‘Sri City (P) Ltd.’ After an extensive survey followed by a detailed study, the present location, that spreads into Sathyavedu- Varadayya Palem and Tada mandals, the most backward area in Andhra Pradesh was found ideal. This location has easy access to rail, roads, airports and seaports. Proximity to Chennai and the idea of making it what Hosur is to Bengaluru clinched the choice.
The process of land acquisition was an interesting challenge and the Sri City Management addressed many of the issues for a consent-based settlement and acquired 10,000+ acres of land without litigation. These initiatives are now part of the new land acquisition Act of the government of India.
On completion of land acquisition, Sri City entrusted the task of designing and developing the site of a Special Economic Zone, on the concept of ‘Work-Live-Learn-Play’ to M/s Jurong, Singapore.
Complementing the business zone is the social infrastructure zone with multi-level residential options, commercial and retail development to make life self-sufficient and enable working & living a truly pleasurable experience at Sri City. The formal groundbreaking was done on August 8, 2008 by then Chief Minister of AP Dr. Y.S. Rajasekhar Reddy.
Challenges faced during the development phase
Over the years, the journey hasn’t been hunky dory for Sri City. Post the Lehman crisis towards the end of 2008, several companies pressed the pause button on their plans here. Things started to slow down, but Mr. Ravindra Sannareddy stuck to his decision to invest in the infrastructure, as he knew that unless a world-class infrastructure was developed, Sri City wouldn’t be able to attract world-class companies. Thus, he viewed the slowdown as an opportunity to develop infrastructure at the lowest cost. Once the companies saw the infra was in place, they started to sign up. Since the export markets were looking lacklustre, Sri City Management set up a special domestic trade zone for multinational companies to help them improve their footprint in the domestic market.
Recognising the business potential and investment opportunities of Sri City, in 2010 M/s Venture from South Africa signed up an agreement as the first client. Soon, BFG, VRV Group and Saakar also came on board to set up their facilities at Sri City. Sri City soon emerged as a well-established name among the distinguished corporate entities in the country.
A gateway to the world of business
Soon it emerged as a well established name among the distinguished corporate entities in the country, and in line with the ‘Make in India’ and ‘Make in AP’, the dream campaigns of the Central and State governments respectively, with its world-class infrastructure and locational advantage for exports and imports, Sri City emerged as one of the best global manufacturing hubs in the country, giving a fillip to creation of jobs and getting the economy on the fast track. After the bifurcation of the state, Sri City, with its plug-and-play infrastructure, has become as one of the key industrial destinations in the Sunrise state of Andhra Pradesh (AP). Since the state government has embarked on a massive exercise to build the state with large industrial investments, Sri City, though it is a private SEZ, is getting featured in states’ list of clusters for investments. It has emerged as a ‘must visit place’ for various national and international delegations.
Perfect location, tax incentives, rich industrial traditions, and full support during the implementation of the investment process make Sri City the preferred business destination for investors willing to develop their business. The steady influx of several global corporate companies, large Japanese, European, American and Indian multinational companies into Sri City validates the investment opportunities and makes it as the reference point for SEZ across the world.
The best recommendation for Sri City is the long list of its achievements. All put together, as of now, about 180 companies from 27 countries have chosen Sri City as the home, investing nearly Rs.28,000 crores. The city is already buzzing with activity, brought alive by more than 120 operating units from various industrial sectors. Some more manufacturing units are under construction and will soon be a part of this industrial growth engine. The aggregated value of exports from Sri City units during the past seven years is around Rs.4000 crores.
A multi-product manufacturing city
In its true sense as a multi-product business city, Sri City is having a global footprint industries, with interests in varied sectors – automotive, IT/ITES/BPO, Engineering, Logistics & warehousing, Apparel & Fashion, Biotech/Formulation, Electronics/Hardware, Renewable Energy, Fast Moving Consumer Goods (FMCG), Food & beverages and other Eco-friendly industries. Here, we find global names making trains (Alstom), toys (Pals Plush), cars (Isuzu), chocolates (Mondelez), soft drinks (PepsiCo), corn flakes (Kellogg’s), Coffee (Lavazza), cranes (Kobelco), smartphones (Foxconn) and toothbrushes (Colgate Palmolive) – just to give an idea of the sweep.
Emerging as top Japanese business enclave
Sri City can be viewed as ‘mini Japan’, since more than 20 Japanese companies, most of which are in the automobile, engineering and logistics sectors, have already setup their units here. Along with the OEMs like Isuzu and Kobelco Group, several autocomponent makers also have setup their units in Sri City because its proximity to Chennai and North Tamil Nadu, which has become a hub for automobile majors, particularly the Japanese brands. Isuzu, Kobelco Cranes, Kobelco Construction Equipment, Kobelco Plate Processing, Toray Industries, THK, Ebara, NHK Springs, Piolax, Imop, Aisan, Nitton Valves, Nippon Seiki, Kikuwa, Tohoku Steels, Nittsu Logistics, Kusakabe, Unicharm (manufacturer of hygiene products), etc., are some of the prominent brands among the Japanese customers. With the manufacturing capacity of some of these companies almost hitting their upper limit, they are expanding their units for enhancing production capacity.
The total investment by all these Japanese industries amounts to over Rs.9040 crores creating employment opportunities for about 8500 persons.
With Sri City emerging as the busiest investment hub for Japanese companies, the integrated business city started looking at creating the right environment with dedicated space for companies from that country. Accordingly, Sri City developed a Japanese enclave.
Job creation & Employment opportunities
Before the advent of Sri City, there were hardly any industries in this area. Over these years, with investments in Sri City, the region has transformed into a bustling one, while enjoying local support due to job creation and overall improvements. Even in job creation too, Sri City has a well balanced mix. As of now, all the companies provide employment (including the direct and indirect) for over 40,000 persons. As per a survey conducted recently, half of this number is engaged in the jobs provided by the industries, and the rest is engaged in support services viz., construction, operating vehicles on contract, man-power supply, house-keeping, security, own business in villages etc.
Among the total number of people who are having livelihood, over 45.62% is from different mandals of Chittoor (including the villages in our vicinity), 27.72% is from Nellore district, 15.49% belong to other districts of AP, and 11.17% is other states, including Tamil Nadu.
The employment data pertaining to the Sri City villages confirm that, of the total population of employable age, barring the housewives, more than 98% are employed, either directly or indirectly.
The initiative of Sri City in employing large numbers of women in the industries certainly makes it unique. For instance, in Rising Star (a unit of Foxconn) itself, as high as 15000 women are employed. Similarly, some more units, such as, Flextronics, Pals Plush, Mondelez, Kellogg’s, Evertan Tea, MSR Garments, KGI Clothing, Unicham, Colgate Palmolive, etc have a large women workforce. The percentage of women workforce ranges between 20 to 95 in those units.
Developing human resources in the region
As there is a great demand for technical manpower from the industrial units of Sri City. Though there is enough youth population in the region, they lack skills, and hence need training for imparting necessary skills. Skill training initiatives are happening at three levels – developer, corporate, and government. Even before setting up Sri City, as a developers, we started a training centre to train locals and give them employment. About 3000 people have been trained till date. Many of them got jobs not only in Sri City even else where. The Chennai based TVS Group started a Skill Development Centre at the ITI campus in Tada. To start with, it offers ITI level training in a few trades, and gradually increases the scope and content of the courses. The curriculum of the courses is oriented to the industry needs. There are also State-and Central-level initiatives.
A Technical Skill Development Institute, which was set up in Sri City with the support of AP government and managed by M/s Siemens, offers free training to Diploma and Engineering students in Computer Applications, CNC machining, Automobile Engineering. CAD/CAM and Welding, and imparts special skills.
In order to have continuous supply of talent pool, Sri City had set up an employment bureau, wherein a database of the job seekers is maintained. Unemployed people can register by submitting their resume either in person or by email (id: firstname.lastname@example.org ). Registered resumes are shared with the industrial units which are in need of suitable candidates, and the matching skill set candidates would be contacted by the employer directly.
Impact of Sri City on the society around it
The local impact of Sri City manifests in the form of education, employment and over all socio-economic development. Sri City’s CSR programme aims to comprehensively develop the neighbourhoods focusing on improving vital social parameters like access to quality education, better health services, social infrastructure, livelihood options etc. Sri City villages have witnessed a radical change in the workforce structure, with a good diversification, which is an important indicator of health of economy. During Pre-Sri City period, the workforce was largely concentrated in agricultural sector with a very minimum proliferation into non-farm sectors, much less into the industrial employment; salaried job-holders were very few in number. Presently, the workforce is rapidly diversifying with a clear movement towards industrial employment and salaried employment.
The Socio economic surveys conducted by the SV University, Tirupati in 2012, Tata Institute of Social Sciences (TISS), Hyderabad in 2015, and the Rural Media in 2016 document that the advent of Sri City made a predominantly positive influence in terms of economic development in the region, particularly ample empowerment opportunities. Most women in the area feel that employment opportunities in Sri City have certainly given them a voice and the ability to take a stand and speak confidently for themselves wherever necessary.
To sum up ….
A decade ago, the entire region, which was the most backward one in the state, was with known for poor employment potential. There were no proper education and medical facilities. But today, with advent of Sri City, besides being India’s premier industrial destination, with the presence of several major companies, renowned institutions of higher learning, the region draws the attention of the entire country. Being the current focal point of economic evolution and high yield on investment in Bengaluru-Chennai and Visakhapatnam-Chennai industrial Corridors, Sri City stands out as one of the best places for long term development and growth.
In line with the ‘Make in India’ policy, Sri City has emerged as a highly recommended investment destination for leading investors worldwide, boosting local manufacturing which, in turn, will give a fillip to creation of jobs and get the economy of state and region on the fast track.
Quote of Mr. Ravindra Sannareddy, Founder, Managing Director:
Ravindra Sannareddy says, “In the first 10 years, we focused on industrial infrastructure. After achieving critical mass in terms of number of factories and people employed in them, we are now focusing on creation of world-class social infrastructure, led by residential development in a ‘walk to work’ environment, with an estimated potential of 50,000 housing units. We are also planning to bring more number of educational institutions, skill development centres among other social infrastructure to provide a complete ecosystem in the business park.”
“From being a dry and arid zone where there was little or no farming, today this entire region is a fertile hub of growth and industry, with over 40,000 employees. A decade ago, the sparse population that lived here had to travel to Chennai or Tirupati for hospitals or schools. Now all services are just minutes away. This story of transformation is one of the greatest successes of Sri City, and we feel very proud of this. Some more popular educational institutions are very keen to step in Sri City.” (Report/Ravindranath. C)