India has emerged as a leading ‘digital talent nation’ and is leading the race to become the global digital technology hub, with 11-15 per cent of the country’s tech talent residing in tier-II and tier-III cities, according to a report by Deloitte and NASSCOM. “As decentralisation of work gains momentum, many new opportunities open for people in emerging cities. With 60 per cent of India’s graduates in engineering, arts, and science, smaller towns are emerging as a wellspring of potential,” the report said.
The joint report has identified 26 promising locations that have the potential to become the epicenter of innovation and growth. This trend, it said, is fueled by a highly proficient workforce in digital technologies, with about 8 lakh individuals within these emerging hubs adept in the latest tech domains. The emerging cities of India are witnessing a surge in digitally skilled workforce, with over 100,000 professionals contributing to their growth.
“While big cities were the focus in the past, the post-pandemic era witnessed a remarkable decentralisation of work across the nation. Today, about 60 per cent of India’s overall graduates come from smaller towns and 30 percent of total graduates relocate to tier-I cities seeking employment. These locations that currently account for 10-15 per cent tech talent, provide promising growth potential when supported by the governments’ commitment to world-class infrastructure,” said Sumeet Salwan, Partner, Deloitte India.
The report talked about five overarching pillars which are vital for establishing a technological landscape – talent, infrastructure, risk and regulatory environment, start-up ecosystem, and social and living environment. “India’s ascendancy as a ‘Digital Talent Nation,’ spearheading global aspirations to become a digital technology hub, is tangible. Fueled by rapid infrastructure growth, diverse skills, burgeoning start-ups, and governmental initiatives, these emerging hubs are gearing to achieve the tier-1 status,” it said.
Cost advantage: In emerging cities, businesses enjoy a 25-30 per cent cost advantage in talent pool costs and a striking 50 per cent lower real estate rental compared with mature hubs. Over 140 Global Capability Centres (GCCs) have established their centers in these locations, highlighting the growing interest of global enterprises in these promising emerging hubs.
Economic resilience and innovation: Besides the cost advantage, tier-II cities have become a ground for nurturing a mutually beneficial relationship between start-ups and established corporations. In the past decade, this dynamic ecosystem has created about 900,000 direct and 300,000 indirect jobs. About 39 per cent of the country’s start-ups (over 7,000) operate in emerging hubs spanning industries from DeepTech to Business Process Management (BPM).
“Supported by governments’ push, availability of talent, and the new operating model where work proliferates equitably, these emerging hubs offer the potential for exponential growth,” said Sumeet Salwan.
“India is expected to have a skilled talent surplus by 2030. These hubs offer companies a compelling blend of advantages: access to a fresh, skilled talent pool, cost-effective operations, and robust infrastructure. As state governments and local ecosystems invest in skilling and improving ease of doing business, these burgeoning hubs are now essential waypoints in India’s journey to becoming a global technology powerhouse,” said Sukanya Roy, Head GCC and BPM, NASSCOM.
The Skill India initiative is a great example of the collaboration between the government and corporate sectors, with more than 50 companies providing practical technical training. A total of 83 out of 242 Special Economic Zones and 15 of 60 software technology parks of India centres are located in emerging cities. “Fueled by a $1.4 trillion investment in infrastructure, our digital transformation story gets an added boost, manifested by the impending rollout of 5G,” it said.