Is This the Smartest City in India?

Why you should care

Because this is where you might do business one day.

When Indian-American Jeet Vijay moved to the motherland six months ago, there were a few obvious options. He’d never lived in India before, and he could have settled in Mumbai, where many expats reside, or in Delhi, where the international elite congregates. Most natural for the longtime venture capital and private equity man would have been Bangalore, the technology hub and the city that led Thomas Friedman to declare the world flat.

Instead, he chose what Indians call a “tier two” city, one that years ago would have seemed a frankly strange option: Pune. Located about three hours by car from Mumbai, Pune has been dubbed slightly strangled things like “the Oxford of the East” for the presence of its more than 800 colleges, and “the Detroit of India” because of the automobile industry’s presence. Indeed, Pune has been fortunate, enjoying a mix of a youthful feel thanks to the colleges, an upscale vibe that comes from dynastic industrial families and the general tinge of cosmopolitanism accompanying the software boom, which brought outsourced jobs to the city.

“I chose Pune because it’s like Austin,” says Vijay, who formerly oversaw student startups at the University of Texas campus there. Here in India, he plans to do the same, bringing young people in Pune together with their counterparts worldwide in an educator-slash-incubator called Bhau. Startup fever is certainly one measure by which to test just how happening a city is, and by that measure, Pune is doing swell — AngelList counts 880 in this city of city of 2.5 million. (The site says around 970 are located in Gurgaon, outside Delhi, one of the other major tech capitals).

Can it pull off what so many cities are experiencing today as they are lifted up by the billowing coattails of the tech industry?

But check the other vital statistics and it’s thriving too. Quality of life? Yep: A 2015 Mercer Quality of Living survey ranked Pune the second-best place to live in the country, after erstwhile tech center Hyderabad. Jobs? Employment portal found in 2014 that in the IT sector, which is growing around 14 percent a year, Pune was a top three destination city for employers. “There’s a lot of talent available,” says Navin Honagudi, the investment director at Mumbai-based KAE Capital who oversees Pune investments for the firm. That’s thanks to the long history of legacy IT companies employing people in the city, from Infosys to Wipro. Much as Seattle has seen cloud technology startups spin off from former Amazon and Microsoft employees, Pune might draw on the talent of people trained by the big guns to innovate for the next round of entrepreneurship. “I would say if you’re going to have a new company today, you should definitely consider Pune,” Honagudi says. 

Then there’s the growth of the city itself: A report by the Pune Smart City Commission estimates the population will hit 5 million by 2030. And as the whole country gets itself in a tizzy trying to create the “smart cities” Prime Minister Narendra Modi has ordered up, Pune’s municipal commissioner Kunal Kumar, a graduate of the Indian Institutes of Technology who carries himself more like a Silicon Valley CEO than a local policymaker, is collected and calm, taking meetings with Americans from the Department of the Treasury, organizing conversations on waste management with Japanese leaders, answering a phone call from the United Kingdom in the middle of our time together. (He trades quips about the recently elected London mayor Sadiq Khan with the person on the other line, and, before hanging up, tells them, “Yes, we all have to work for our cities.”) 

So far, that work by Kumar and his predecessors has involved a lot of money-grubbing, finding new sources of funding for infrastructure projects such as the new ring roads he wants to construct or the train improvements the city will need if it is to nearly double its citizens’ use of public transit by 2030. Kumar has also focused on things like clean water delivery in a drought-stricken state at the same time that he bakes up plans to connect the city to Wi-Fi in major hubs. 


But many foreigners arriving in Pune will be struck by that eternal problem of Indian cities: Poverty’s still rampant. Not far from the stately homes in tree-lined Koregaon Park, one can still encounter slums. Indeed, 36 percent of the city’s population live in slums — greater than the average of 22 percent of people who live in such conditions in other Indian metropoles, according to the Smart City report. And then there’s the trouble behind that black-boxed word startup!  To “innovate” alone is not enough. The quality of Pune’s startups remains low, say both KAE’s Honagudi and Vijay. As in the entire country, there’s a dearth of creativity and too much copycatting foreign tech companies. “It hasn’t yet lived up to the promise,” Honagudi says. Indeed, few of the companies in the city inspire breathless, futuristic headlines — more like steady, plodding descriptors about back-end or business-to-business software.

And then there’s the question of learning from the elders. Bangalore may have been the city to instill palpitations in the heart of globalization enthusiasts a decade ago, but it has since become frightfully congested: Horror stories abound among city residents — hours spent in traffic each day, property prices rising. Can Pune avoid Bangalore’s fate? More broadly, can it pull off what so many cities are experiencing today as they are lifted up by the billowing coattails of the tech industry? After all, making a modern city requires more than just plentiful Wi-Fi.


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