The new terminal at Kolkata airport is a striking building. Wide, gently curving glass walls sit beneath the overhang of an immense angled roof. Inside, light pours down from long skylights to the open space below.
The state-of-the-art terminal, which officially opened in January, cost Rs 23,250 million (£278 million) and will increase the airport’s annual handling capacity from nine million to 20 million passengers. It’s one of many projects under way in Kolkata. The northeast Indian city, and the West Bengal region of which it is the capital, are undertaking a wide range of initiatives with the aim of encouraging business.
Kolkata is developing fast, but this wasn’t always the case. The city has always had the potential to become an important business centre, boasting a major port and a large, highly educated workforce. But for years, economic development was held back by the region’s politics and poverty.
In 1977, the (Marxist) Communist Party of India came to power in West Bengal. Its lack of support for corporations and limited investment in infrastructure, together with an unwillingness to stop frequent industrial action, did little to draw business to the region. This meant West Bengal wasn’t able to capitalise on the country’s economic liberalisation in the 1990s, or the booming demand for IT services, in the way other parts of the country did.
“Things went very slowly because of the kind of communism which has led Kolkata for so many years,” explains Rakesh Raicar, Cathay Pacific’s regional sales and marketing manager in South Asia. “So it hasn’t progressed as much as the other cities.”
Suparno Moitra, head of the Kolkata office for IT trade organisation NASSCOM, says the city’s IT industry was neglected and so its growth during the nineties was “abysmally slow”, with only 30 companies operating. HSBC Global Resourcing, which chose to locate offices here in 2005 because of the educated workforce, says that, in the past, the city’s poor infrastructure had been an issue.
Recently, however, things have shown signs of changing. The government is increasingly recognising the need to invest in infrastructure and to stimulate business. In 2011, the communist government was replaced by the All India Trinamool Congress – a party that is firmly in favour of establishing the country as a global power. It aims to further the “all-round development of India in the political, economic, industrial, social, cultural, agricultural sectors”, the party website says.
Raicar says: “The chief minister and the government want the region to grow. So you’ll see a lot of things happening – the IT sector, the Metro, and plenty of flyovers going up. These are all going to attract investment.”
Driving into Kolkata from the airport, you certainly see signs of a city on the rise. The road passes concrete pillars supporting an overhead railway, part of the government-funded east-west extension to the Kolkata Metro. This is one of four metro extension projects under way that, together with the construction of expressways, aim to link up the city’s new areas and relieve its traffic-clogged roads.
The road south from the airport passes by new industrial buildings, part of Salt Lake City, an area of former salt flats that has been converted into a satellite town with upmarket residences and numerous tech parks housing most of Kolkata’s IT companies. The Kolkata Metropolitan Development Authority is building several similar satellite towns around the city – Kolkata West International City, a collaboration with Indonesian investors, will have residences for 80,000 people along with three technology parks, while Calcutta Riverside will have a ten-hectare IT park and residences.
Last year, the state government launched an ambitious initiative to develop a new IT and finance hub in Rajarhat New Town, to the east of the city. The State Bank of India, UCO Bank, United Bank, UTI Mutual Fund and Industrial Financial Corporation of India have all reportedly expressed interest in investing, and the project is forecast to attract Rs 160 billion (£1.9 billion).
The signs of an improving business climate are drawing companies here. The city has recently gained the offices of firms involved in steel, heavy engineering, electrical engineering and mining industries. Following the change of government, it also saw a surge in investment proposals.
The fastest-developing sectors are IT and business process outsourcing. In 2010, PricewaterhouseCoopers announced plans to establish a 2,000-staff service delivery centre to provide back-office functions. Meanwhile, Indian IT companies Wipro and Cognizant have both unveiled plans to expand their Kolkata operations.
Moitra explains that the city is attractive to IT companies because of its educated workforce and lower labour costs. He says Indian IT companies are facing growing pressure because of labour costs, which is leading them to consider the country’s second- and third-tier cities.
Booming business activity means the city is also gaining international hotels. In 2010, Swissotel opened its first Indian property in Salt Lake City. General manager Marco Saxer says 95 per cent of its guests are corporate travellers, mostly from the IT and mining sectors. In January this year, Carlson Rezidor Hotel Group opened a 92-room Park Plaza in the south of the city, and it plans to open a second property in the centre by the end of the year. Starwood is scheduled to open a Westin hotel in July next year.
Next year will also see the launch of the first Marriott hotel in Kolkata, a 300-room JW Marriott property located close to the emerging Rajarhat and Salt Lake areas. A spokesperson says the company recognised that there was an insufficient supply of accommodation in the city to meet fast-growing demand, and that it expects the government’s efforts to stimulate development to lead to more business travel.
“The government is working to attract companies to the city,” the spokesperson says. “If this continues, Kolkata could emerge as a powerhouse for India in the east and a gateway to countries in the Far East. We are seeing a large number of visitors associated with industries such as oil and gas, electronics, steel, leather, textiles, jewellery, shipping and automobiles industries.”
Whether the government’s aspirations for growth succeed remains to be seen, but all signs suggest Kolkata is on the up. A day in Kolkata A morning stroll on the MaidanThis huge area of open grassland in the middle of the city was formed in 1773 when the East India Company cleared the jungle to allow them to see attackers approaching the newly built Fort William. The paths through the fields are peaceful on a sunny morning and you’ll come across men watching over herds of goats, horses grazing, young picnicking couples and boys playing cricket.
Marvel at the Marble Palace
Kolkata has many grand old mansions, relics of a time when it was home to the British Empire’s richest merchants. The Marble Palace is one of the most opulent – built in 1835 by Raja Rajendra Mullick in extravagant neoclassical style, its façade is dominated by six huge Corinthian columns. Inside, it is crammed full of objects Mullick collected, such as vases, antique clocks, ornate mirrors and a statue of Queen Victoria carved from a tree stump. (46 Muktaram Babu Street; open 10am-4pm; closed Mondays and Thursdays. Entry is free but a permit is required from the West Bengal Tourism Information Bureau at 2 BBD Bagh.)
A local lunch at Kewpies
This cosy restaurant on a back street was set up by Kolkata food writer Meenakshi Das Gupta and is now run by her daughter. It’s the perfect place to sample Bengali cuisine, such as thalis (a multi-dish meal) featuring doi Ilish, white fish covered in mustard paste and cooked in a leaf. (2 Elgin Lane (behind Netaji Bhawan); open for lunch 12.30pm-3pm and dinner 7.30pm-11pm; tel +91 33 2486 9929. Advance booking recommended.)
Admire Indian art
The Ahuja Museum for Arts is a small gallery space showing the private art collection of S D Ahuja, who has more than 1,300 pieces shown on a rotating basis. Exhibits range from surrealist screen prints by Abhijit Paul showing the glitz of modern Mumbai, to big sombre faces in broad brushstrokes by Eleena Banik. (26 Lee Road; open 11.30am-7.30pm; entry is free; ahujaptm.com)
Shop at New Market
An elegant deep-red Victorian building was opened as the Sir Stuart Hogg Market in 1874 to provide British residents with an exclusive place to shop. Now the arcades have small stores selling finely embroidered silks in brilliant colours, shawls, saris, handmade jewellery, antiques and wood carvings, and metal statues of Hindu gods. Bargain hard before you buy. (Bertram Street or Lindsay Street (near the Oberoi Grand hotel); open 10am-8pm Mon-Fri, until 2.30pm on Saturday, closed on Sunday.)
