Biotech Demand Grabs Reality Sector: 140 Million sq ft by 2010 Says C&W Report
2 Sep, 2008, India
According to the Cushman & Wakefield Bio Reality in India report 2008, the biotechnology industry would contribute approximately 140 million sq. ft. to the office demand within India by 2010. Even though the country currently holds a minimal market share of 2% of the global biotechnology market, it has immense potential to develop as one of the major players by 2010 and is expected to generate USD 5 billion revenues, creating employment for a million by 2010 through its products as well as services.
C&W conducted a study across 40 cities in India to evaluate the top 15 locations which have or would witness growth in the biotechnology sector based on various parameters related to three crucial factors that affect the industry viz. Investment Environment, Social and Physical Infrastructure as well as Polices and Framework. The maturity in the above factors would foster the pace of development in the sector across various states.
Bangalore, Hyderabad, Chennai, Pune and Mumbai emerge as the preferred destinations to set up a biotech facility and scored considerably high on the parameters with each city having distinct fundamentals / factors driving the growth. These cities hold proven potential and have sustained the confidence of the corporate entities operating under the sector. It offers better infrastructural facilities and talent pool, the two most important factors in setting up a biotech facility.
Sanjay Dutt and Anurag Mathur, Joint Managing Directors, Cushman & Wakefield India add, “The Biotech story is still in its infancy in India, but it appears poised to witness a successful replication of the IT/ITeS precedent. The location preference is also following a similar trend as in IT with most of the biotechnology activities currently concentrated in Southern India; however, a strong momentum towards West & North India with increasing interest of the companies is anticipated.”
In addition to the emerging cities, there are a number of locations that have the potential to grow in this sector like Indore, Banasthali, Alwar, Sotanala, Shimla, Bhopal and Silliguri. Although some of these cities have not witnessed much development in the past, there have been proposed physical infrastructure initiatives in the form of biotech parks and SEZs as well as policies that have been proposed or implemented to improve the location advantage. It is likely that corporate entities would extend their presence to these cities in the medium term, provided the investment environment and infrastructure is improved.
Biotechnology sector in India has grown exponentially over last few years with the market size reaching INR 85 billion (USD 2.08 billion) in 2006-07 and revenues registering a growth of 31% over last year.
To cater to this burgeoning demand from the biotech sector that is expected to be an integral part of the next boom in India, there have been considerable amount of investments and infrastructural developments during the last few years. At present there are 6 operational biotech parks in India and another 27 biotech parks are proposed across the country. The highest number of planned Biotech Parks is in Gujarat followed by Tamil Nadu, Andhra Pradesh, Rajasthan and Karnataka. In addition, there are 24 approved biotech and allied SEZs spread across the country covering a total area of approximately 1,043 acres being planned. Maharashtra has the highest number of SEZs approved followed by Karnataka.
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