BENGALURU: As the world’s aerospace elite touch down in the city for what is India’s largest ever air show, they will likely notice an overburdened airport and a lot of infrastructure bottlenecks.
What they won’t notice perhaps is that on the northern edge of the city there is an entirely new strand of growth that isn’t just about software, the industry that has put this city on the global technology map.
As construction of the new Bengaluru International Airport moves ahead, the area leading up to the airport is seeing frantic construction, most of it focused on providing housing, hotel rooms and manufacturing of high-tech electronics.
This kind of activity around a new airport is a healthy sign for Bangalore, said John Kasarda, a professor of economics at the University of North Carolina, who coined the term ‘aerotropolis’. He said well-planned airports can be major catalysts for rapid and sustainable economic growth. “Having that airport grow and succeed will give an additional boost to an already successful economy, and make it sustainable,” Kasarda said.
In cities across Asia, airports are expected to spur rapid economic growth, as cargo capacities increase rapidly, and manufacturing parks—especially for electronics, pharmaceuticals and other industries that operate on low inventories—set up around the airports, and housing, entertainment and other amenities flourish for workers nearby.
Prime examples include Bangkok’s $4 billion (Rs17,640 crore) Suvarnabhumi Airport -city, which has startedA operations. Hong Kong’s Chek Lap Kok airport is expected to be the cornerstone of Hong Kong’s connection to world trade, and in China, the $12 billion Beijing Airport City will eventually be home to a little under half a million people.
The ambitions of this city, which hosts the biennial Aero India show starting Tuesday, are similar, albeit smaller in scope. The airport will be spread out over 4,300 acres and will cost a shade under Rs2,000 crore. It will probably handle just under seven million passengers the first year going up to between nine million and 10 million passengers in 2010, providing direct employment to about 10,000 people, said Albert Brunner, chief executive of Bangalore International Airport.
“People will not only come here to take flights but also to relax, do business and shop,” he said in an email. “The airport will provide growth giving a strong impact on economy and creation of jobs.”
The cargo capacity at the airport will be about three lakh tonnes each year, making Bengaluru a strong competitor for becoming a regional cargo hub.
That’s good news, said Rajendra Hinduja, executive director of Gokaldas Exports, India’s biggest garment exporter. Quicker turnaround times— one or two days, compared to the current four to five days—would mean that shipments could go through Bangalore, rather than being routed to Chennai or Mumbai, he said.
Cargo is key to the airport’s vitality, says Kasarda. “Air cargo is becoming even more important than passenger movements,” he said, citing the example of Federal Express’s major hub in Memphis, Tennessee, where almost cargo makes up $19 billion of the $22 billion annual inpact the airport has on the city. “What’s happening in many areas is that air cargo is farmore important in job creation than passenger movements,” Kasarda added.
On the road leading up the new airport here, almost every wall standing is covered with advertising, promising commercial and residential projects that would begin around the time the first aircraft takes off from the airport. Land prices, rising for four years now, have shot up by 50% in just the last year, and private developers are working on close to 30 projects.
A good example is Arkavati Layout, a state government-led housing project in the northern suburbs, that will eventually see as many 25,000 homes. It has also announced a Rs5,799-crore contract to Shapoorji Pallonji and Co. to build a 1,400-acre hardware technology park.
“Everything is shifting towards the north”, Mahesh Laxman, regional manager for real estate consulting company Trammel Crow Meghraj, said.
The government is expected to announce soon a 21km, six-lane expressway project that may be ready by December 2008, said Ramesh Zalki, managing director of the Karnataka Road Development Corporation, the agency that builds highways in the state. It is yet to purchase the required 530 acres of land, and has set a 10 February deadline for receiving proposals from developers.
“It will be embarrassing for Bengaluru city if the airport is ready and there are no roads to connect it,” says T. V. Mohandas Pai, head of human resources at Bangalore-based Infosys Technologies, the country’s second largest software services company .