Synergy and Growth

August 23, 2008 by dadmin

Induced cluster development, which started in US in early 1980's, has been attracting attention of nations across the world. Initially, these clusters emerged as areas where vicinity of companies operated in same sector, upcoming start up companies were established through venture capital, and this propelled the movement of skilled labor into the same area for better job prospects. Clusters have proven their benefits over scattered growth of industrial units. It is for this reason various countries have been making a special effort to develop more and more (induced) clusters and convert an entire area as an industrial hub bringing academia, industry and research institutions together. Owing to the positive impact of induced industrial clusters, nations globally have begun to develop clusters with specific sector focus areas such as IT, Pharmaceuticals, Biotechnology, Telecom, Automobile etc. The formation of these clusters has helped the industries in several ways, such as:

* Increasing the current (static) productivity of constituent firms or industries,
* Increasing the capacity of cluster participants for innovation and productivity growth, and
* Stimulating new business formation that supports innovation and expands the cluster.

Life sciences clusters provide constituent companies with access to ready to use individual units and fully equipped lab space which reduces initial investment required by companies to set up a unit. Apart from this, clusters provide access to information, technical expertise, suppliers, investors, and industry-academia collaboration which leads to a stimulating environment for accelerated growth in productivity and innovation. Owing to the increasing scope and inherent potential of biotechnology, governments across the world are trying to promote the biotechnology sector. A key component of this facilitation is development of Biotechnology Parks.

Biotech Clusters in India

Indian biotech industry is predominantly distributed over six major regions in India-Bangalore, Hyderabad, Chennai, Pune-Mumbai, Delhi and Ahmedabad-Vadodara. Of these, Bangalore, Hyderabad, Pune-Mumbai, and Ahmedabad-Vadodara have been natural biotechnology strongholds. Having recognized this, respective state governments have provided an impetus for accelerated growth of the local biotech industry by establishing biotech parks and offering incentives to biotech enterprises. Development of biotechnology parks in India began in the year 2000 with ICICI Knowledge Park, Hyderabad followed by S P Biotech Park, located in its vicinity. While the focus of ICICI Knowledge Park was primarily R&D, S P Biotech Park had a mix of R&D and manufacturing focused tenants. Though it did take some time initially, in about three years both the Parks had progressed to a level of success. This encouraged several other Indian states to incorporate development of Parks as an essential component of their strategy to promote the biotech sector.

While the support of state agency was necessary for setting of Biotech Parks in the initial phase, private infrastructure developers have, of late, shown interest in setting up the same. SEZs being set up by the Mahindra group near Mumbai and the Videocon group near Kolkata are notable in this context. To begin with, proposed Biotech Parks had a generic focus on all biotech activities thus servicing companies across the value chain. Over the last few years, the governments of several Indian states have tried to differentiate the developing clusters by focusing on niche areas within the biotech sector. This is partly owing to the evolution of the biotechnology sector in India and partly due to the significant supply of space that was being created on a national level. The differentiation is aimed at adding a specific USP to the Biotech Parks being developed.

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