German companies in Gujarat get drawn to Pune

Strong German community, city's image as an educational hub attract investment; more needs to be done on infrastructure: Experts

Several German companies based in Gujarat seem to be swimming against the current tide, and setting up shop in Pune.

Helping attract German investment, as Zubin Kabraji, regional director of Indo-German Chamber of Commerce reads it, is the presence of a strong German community in Pune and the city's image as an educational hub.

Kabraji, citing an example, said German ball bearing manufacturer Schaeffler has a unit in Vadodara in Gujarat but decided to expand operations to Talegaon in Pune. Other than Schaeffler, automobile giant Volkswagen will expand their training and manufacturing facilities in Pune, he said.

The automobile giant has already invested $800 million in Pune and the estimated expansion plan is pegged at $200 million.

Most companies that have a presence in Pune are from the automobile and heavy engineering sectors. Kabraji said there are around 300 German companies, large and medium, operating from Pune. The cumulative investment by German companies in Pune in the last 30 years is pegged at around $7 billion.

Talking about companies preferring Pune over Gujarat, Kabraji stated that although establishing units is easier in Gujarat it is not a "tested destination. Other than presence of education institutions and a large and vibrant German community, Pune has of late emerged into a large melting pot of culture, a major attraction for the companies," he said.

Keeping up with the trend, Kabraji stated that automotive giant Continental is also in the final process of setting up shop in Ranjangaon industrial area soon, with an estimated investment of around $400 million.

Pramod Wadpally, country head of Andreas Stihl Private Limited, a German company that deals with core engineering, stated that one of the major reasons for companies getting attracted to Pune is that the city already has a strong base of automotive engineers. "Pune has a strong base of good engineers and it is easy to hire good people. Mumbai port being near is an added attraction," he said.

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