STPI, MeitY, Tier-II, Tier-III, Tech Industry
The MeitY wing’s new role is to take the industry from tier one cities to tier two, tier three cities, and grow the tech industry countrywide,
says its Director General Arvind Kumar
Software Technology Parks of India, a body set up under the Ministry of Electronics and Information Technology in 1991 originally to promote the growth of tech sector by offering software certification, tax holidays and incentives and high speed data connections, is now repositioning itself to be able to drive the next wave of digital transformation that is set to sweep across the country.
“STPI has embarked on its next wave of growth with a mandate to make IT growth truly inclusive in the country. Our 2.0 growth focus is to trigger entrepreneurship in software, products and business process management (BPM) spaces nationwide, not just in big cities. We will fuel this growth by offering incubation facilities, infrastructure, training, skilling, mentoring, funding, and market connect. This will also lead to a huge amount of job creation and additional economic growth in the country,” Arvind Kumar, Director General, STPI, told The Hindu.
According to him, there was an immediate need to shift IT and IT enabled services (ITeS) to smaller cities and towns and STPI has been encouraging and assisting entrepreneurs towards this move.
STPI, since its inception some 34 years ago, played a pivotal role in transforming India’s IT sector - a sunrise sector in the early ‘90s. Its registered units achieved software exports of over ₹10.59 lakh crore in FY 2024–25, accounting for $110 billion of the country’s total software exports of over $200 billion. Software exports worth some $90 billion come from companies operating within special economic zones.
Teething troubles
Recalling the mammoth growth the industry witnessed, Mr. Kumar said those were early years, but crucial as the industry was in its infancy.
“At that time, the challenges faced by the industry were different. No one knew how to export software or how to certify and fix a value for it. Desktops and laptops were all imported and unaffordable for most entrepreneurs. There was a need to establish connections with various state governments to ensure tax holiday/incentives. STPI alone had a reliable broadband connection those days,” he said.
Although STPI began three decades ago, it had operations only in Bengaluru, Pune and Bhubaneswar for many years. While today it has 67 centres, 59 of these are in tier two and three cities.
New growth centres
“Now the government is looking at why the growth is not happening in Lucknow, Chandigarh, or other tier two and three cities. So, STPI’s new role is to take this industry from tier one cities to tier two, tier three cities and grow the tech industry countrywide,” he added.
As a preparatory measure, STPI has already created some 17 lakh square feet incubation space in tier two and three cities to accommodate small tech, product or BPM entrepreneurs or micro, small and medium enterprises who can start their firms. “This will provide support to youngsters who are passing out from engineering colleges in small towns and give them a quick start,” Mr. Kumar said.
Product push
STPI has created 24 centres of entrepreneurship nationwide to encourage a start-up culture in the product space. In the last three years, STPI has supported around 1,500 start-ups and those have created around 800 IPRs and over 2,000 product innovations. These firms have raised over ₹600 crore in funding and generated ₹565 crore in revenues in the last three years. “So a lot of things are happening in the product side and a lot of things are happening in the start-up domain as well,” Mr. Kumar added.
He said, while the country’s IT/ITeS services exports have now touched nearly $224 billion, software products lag behind at $17 billion, with product exports contributing roughly $12 billion.
STPI was aspiring to become the largest technology start-up ecosystem in the country and has been endeavouring to transform the country into a software product nation as envisaged in the National Policy on Software Products (NPSP) 2019, Mr. Kumar said.
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