Development of Hyderabad

Amazon's offices take up the top two floors of a nine story office building. Our cafeteria is on the top floor and looks out over a portion of Hitech City. As I walked up to lunch today with a few co-workers, we were discussing the food options in the area. It turns out that there are two: the cafeteria (which bores everyone) and a little sandwich place in the office building next door (which is overpriced and barely a step above the cafeteria -- note I still like the food in the cafeteria).

Looking out of the window of the cafeteria, you see several square blocks of these very modern buildings; the rest of the land is made up of either rock fields or little shanty towns I asked some of my lunchmates how Hitech city has been developed. It turns out that the government basically gives the land away very, very cheaply to these big corporations. The corporations in turn spend their own money developing these offices.

The corporations get cheap, educated labor. Hyderabad gets tons of job creation and a place on the map. Everybody wins.

But, I can't help but feel like there's a real opportunity missed here. You've got all of this money pouring into this area with tons of educated, middle class workers congregating together. Yet, they have nothing to spend their money on (at least while at work). Listening to the stories of my co-workers, I've got to believe that if a nice restaurant opened up right next door, it would make a killing. Yet, there's no ecosystem being developed here -- just tons of office buildings.

A large part of that is that while the government is giving these huge breaks to encourage companies to come in, they won't bend at all for other businesses. And few people in Hyderabad have the capital to just come in and open a restaurant.

The Indian government has apparently made many efforts to move the country forward. But, a lot of them end of failing. With the amount of poverty in India -- about 1/3 of the population subsists on less than $1 per day -- initiatives that might have long term benefits have huge short term implications for many.

The Indian government is then caught in this situation where they're trying to change the country without actually disrupting people's lives. Hitech city has worked out so well because it was funded entirely by the outside. The government just provided the land and the international corporations took care of the rest. There was no need to siphon funds from anything else. And the new corporations didn't disrupt an already existing market, but rather created a new one. It was possibly the least intrusive way to bolster the economy.

The local government has done a great job of advancing Hyderabad by promoting Hitech city over the past 10 years. And I know it's a complex situation that I'm only begining to understand. But, there seems to be an untapped opportunity here to transform this area from a bunch of office buildings into a very integrated economy.