Top 10 emerging business hotspots

At roughly Rs 71,270 crore (Rs 712.70 billion), Ahmedabad saw the highest volume of investment by various companies in last two years among top 10 emerging business destinations, said global real estate consultancy, Cushman & Wakefield (C&W).

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The latest report on 'Top 10 Emerging Business Destinations in India' by C&W has identified the cities of Ahmedabad, Bhubaneswar, Chandigarh, Coimbatore, Jaipur, Kochi, Indore, Nagpur, Vadodara and Vishakhapatnam as the next most promising business destinations offering a long term investment potential.

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Ahmedabad formed 38.8 per cent of the total investment volume of Rs 183,700 crore in the top 10 emerging business destinations, followed by Vishakhapatnam at Rs 58,180 crore (32%) and Vadodara at Rs 24720 crore (13.5%).

In Ahmedabad, however, since 2010, majority of which was in the automobile and auto components sector, followed by telecom and real estate and infrastructure.

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"The emergence of tier II and III cities, is significant for the growth of the country's economy as it ensures continuity and rationalisation of business over a period of time. Businesses on the other hand are looking at identifying other suitable locations to setup or expand as they provide the advantage of either lower production and operation costs and access to better resources or to avail better infrastructure and/or benefits of favourable government policies," said Sanjay Dutt, Executive Managing Director, Cushman & Wakefield India.

"These emerging locations represent the possible growth trajectory India's economy will follow in the next few years," he said.

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According to C&W, among the specific industries or sectors, the metals and metal products manufacturing companies have announced the highest volume of investments with a 39 per cent share, followed by power production companies at around 16 per cent and chemical and petrochemical companies with approximately 11 per cent share.

IT & ITES has seen a growth in investment of 3 per cent. While the investment in this sector is relatively lower than other sectors, it has a higher contribution to the GDP.

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"The growth in these cities will be led by primary sectors like metallurgy and power, though services and manufacturing will play a crucial role in creating a more holistic socio – economic environment in these cities. However the most noteworthy aspect is that most of these locations have already identified their niche in certain primary and secondary sector verticals and are strategically poised for expansion into the services sector," Dutt added.

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The cities which will see growth for metals and metal products are Bhubaneswar, Indore, Nagpur and Visakhapatnam due to proximity to the mining belt and good transport infrastructure.

For IT/ITeS sector, the strongest emerging cities are Bhubaneswar, Chandigarh, Jaipur and Kochi, which are attracting sizeable occupier interest.

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These cities offer the best manpower pool and necessary support infrastructure.

Within the automobiles and auto component industries, the strongest emerging cities are Ahmedabad, Coimbatore, Indore and Vadodara as they offer relatively cheaper and sizeable land parcels and supportive investment environment created by the state governments.

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Further, Ahmedabad, Vadodara and Vishakhapatnam are the strongest emerging cities for chemicals and petro-chemical industries including refineries.

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For pharmaceuticals and biotechnology, Ahmedabad, Indore, Vadodara and Vishakhapatnam are the prominent emerging destinations.

Kochi and Vishakhapatnam, both historically prominent port cities, retain their importance for shipping, ship building, and marine products trading.