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Key Indian cities for setting up a new ER&D centre
Key Indian cities for setting up a new ER&D centre

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While setting up a new ER&D centre within India, there are various parameters to be considered in the same vein as we apply while selecting a global location. These include –

  1. Talent availability including proximity of talent with respect to STEM talent availability including fresh and experienced talent, talent competitiveness etc,
  2. Cost attractiveness including cost of labour, cost of operations, cost of living etc.
  3. ER&D ecosystem including presence of similar centres, presence of start-ups including unicorns, presence of eminent educational hubs
  4. Business environment including ease of doing business, current infrastructure, current macroeconomic landscape, and political stability among others

Some cities that emerge as key locations for setting up an ER&D centre in India include Bengaluru, Delhi National Capital Region, Hyderabad, Chennai, Pune, Mumbai, Coimbatore, and Ahmedabad. This is so because of strong talent pool availability, a facilitative business environment, existing ER&D industry infrastructure and cost competitiveness, among others. These locations are among the leading locations in the country and offer opportunities to ER&D enterprises to establish their ER&D centres and scale rapidly.

 

Location 8

 

As per the NASSCOM-KPMG Engineering R&D Global Location Analysis, after assessing the locations across all the identified parameters, Bengaluru emerged as the most preferred location, owing to its strong start-up culture including tech start-ups, high presence of GCC centres, and conducive business environment. Bengaluru is known as the Silicon Valley of the country and has presence of skilled talent needed for ER&D enterprises to scale up.

While assessing individual parameters separately, with respect to “Talent”, Bengaluru leads in the talent parameter in the presence of number of R&D personnel and the overall talent competitiveness score of cities across India.  Bengaluru also offers the highest GCC talent pool in the country.

India as a whole offers the highest cost advantage due to low cost of labour and operating cost. With respect to assessment of locations across “cost attractiveness” parameter, Coimbatore has emerged as the most competitive location in the cost parameter among the eight Indian locations part of the analysis, followed by Chennai, which offers low operating cost.

Assessing the locations with respect to “ER&D ecosystem” parameter, Bengaluru leads across the other cities, attributed to the city’s strong presence of the highest number of GCC centres, technology start-ups, and unicorn start-ups in the country. This is followed by Delhi NCR, which has presence of high number of universities and engineering colleges.

Indian cities assessed across “business environment” demonstrates Hyderabad scoring highest in business environment parameter largely owing to the facilitative policies adopted by the state of Telangana to transform the region into a hub of innovation and research. Hyderabad also features at the top for providing relevant infrastructure to new businesses. Chennai and Delhi NCR follow Hyderabad and perform better than other locations in the macroeconomic risk and quality of governance (political environment) factors.

There are many cities within India where ER&D companies can set up an ER&D centre and one has to assess all the cities across all parameters based on the requirements of the company. Organizations need to develop a comprehensive location strategy that underpins their blueprint to build, grow and sustain their ER&D centres.

 

Read more about this in the report “Engineering Research and Development – Global Location Analysis” from the links below –

NASSCOM Website – https://nasscom.in/knowledge-center/publications/engineering-research-and-development-global-location-analysis

NASSCOM Communityhttps://community.nasscom.in/communities/engineering-research-design/engineering-research-and-development-global-location


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Vandhna Babu
Principal Analyst - Research

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