N Chandrababu Naidu, former chief minister of Andhra Pradesh, ignited an explosion of sorts by establishing the city as a hub of outsourcing services in the information technology sector. From a mere few software units in 1992, Naidu raised the total count to more than 1,200 units by March 2002 taking the total investments to the state to about Rs 1,300 crore. In terms of exports, AP ranked fourth from a mere Rs 2 lakh in 1991-92 to Rs 2,007 crore in 2000-01.
Among the factors that propelled the city into the big league were the setting up the Hitec city, the International Institute of Information Technology and a pro-IT policy. Naidu formed a think tank, called AP First Information Technology Committee, with prominent personalities such as Azim Premji, chairman, Wipro, FC Kohli, vice-chairman, TCS, Raj Reddy, professor, Carnegie Mellon University, Infosys chief mentor NR Narayana Murthy and Ramalinga Raju, founder and chairman of Satyam Computer Services Computers.
Also in place is the blueprint for building the much sought after urban infrastructure in Hyderabad and Visakhapantam to attract the IT and BPO companies to the state. In the last four years, the AP government had made a budgetary allocation of Rs 3,071 crore for promoting IT infrastructure in Hyderabad and tier-2 cities in the state.
Since 2004, the IT sector has grown at 40%. As per the latest statistics, 40 IT Special Economic Zones have been approved by the Government of Indiaclaimed to be the highest in the countrythat would open up eight lakh jobs in the next five years. Around 15 IT parks were developed by private developers providing employment to1.49 lakh software engineers and others. The state has contributed 15% to the total IT exports recording Rs 26,122 crore in 2007-08.
In last three years 325 IT companies have set up shop in Hyderabad and Visakhapatnam bringing the total to 1,234, recording a revenue of Rs 18,582 crore in the year 2006-07, against Rs 12,521 crore in 2005-06.
The state expects the IT industry to grow reasonably well as more foreign investments pour in. AP has attracted Rs 10,442 crore worth of investments in the IT sector in the last four. A record Rs 7,000 crore investments were made in IT infrastructure during current year alone.