Although moves are afoot to improve the investment climate with incentives and concessions proposed in the new Karnataka IT policy, fact remains that it was the city's climate (now fast deteriorating) that drew companies.

With software exports from Bangalore alone set to cross Rs 3,400 crore this fiscal, the bureaucracy has thus far been complacently tossing out year-on-year export growth figures.

Unfortunately, for the city, these figures do not give the complete picture. The growth, based as it is on the existing facilities already up and running, could be deceptive. In fact, in percentage terms, IT export growth has been shrinking, down from over 100 per cent in 1997-98, to around 70 per cent in 1998-99 and projections for 1999-2000 down to around 56 per cent.Although IT companies made a rush for Bangalore after Texas Instruments and IBM through the early nineties, they seem to be dragging their feet now.

Most of the new software technology parks (STPs) coming up in the city --- 347 at last count --- have been planned by existing players for whom it makes logistical sense to concentrate their facilities in one place.A telling indicator is that approved foreign direct investment in Karnataka till this point in the current fiscal is a trifling Rs 273.97 crore (in 50 projects) compared to Rs 4874 crore in 102 projects last fiscal.

Bangalore's nearest competitors --- Hyderabad and Chennai --- are catching up fast in the race to woo IT investments. As far as STPs go, Hyderabad which is barely two years in the game already has 223 projects while Chennai boasts 129 STPs. Both these cities, though not blessed by the weather gods, have made themselves attractive enough by improving infrastructure and upgrading facilities for potential investors.

While Bangalore degenerates into an urban nightmare with roads caving in, power supply still erratic and an apology for an international airport, Andhra Pradesh chief minister Chandrababu Naidu is overseeing the decongestion of Hyderabad with a dozen flyovers already in place and Tamil Nadu is moving towards a surplus power situation.

According to IT chieftains in Bangalore, infrastructure seems to be the single biggest problem (if one overlooks the pollution levels).

Microland chairman Pradeep Kar was gentle when he said that infrastructural gaps could not be filled overnight. Aditi CEO Pradeep Singh, while admitting that the power situation had marginally improved, pointed out that the roads were getting worse and international air connectivity was still a problem.Another CEO, who wished to remain anonymous, said bureaucrats were getting mileage from the work IT companies had done. ``What has the government or the administration done but enjoy the fruits of our labour,'' he enquired, commenting about the hype generated about the event and the city.

To look at the brighter side, however, Krishna has been getting into the IT act (a la Naidu). Image-management, in itself, however, will not be enough.

What is needed is real-time action on the infrastructure front. And leveraging the inherent advantages like high levels of English comprehension and an IT-savvy populace.

The state IT policy will attempt to make Bangalore and the proposed IT hubs including Mangalore and Mysore more attractive investment destinations. Whether new investors choose to sup with Krishna will bring out the proof of this pudding.