Hormavu, a sleepy suburb at the eastern tip of India’s tech capital Bangalore, is perhaps not as well known as other areas like IT magnet Whitefield. But land prices have shot up 900 per cent here in the past three years, a shocker even for the city’s red-hot realty market. Kevin Jansen, a property developer at Hormavu, attributes the rise mainly to the area becoming part of Greater Bangalore.

Proposed in the 1990s, Greater Bangalore became reality on 17 January 2007, and included seven town municipal councils (TMCs), one city municipal council (CMC) and 111 villages on the outskirts of Bangalore. The move effectively trebled the city’s area from 221 sq. km to 741 sq. km. The new entity has been promised better roads, power, water, drainage and other civic amenities. The idea is to encourage businesses, and people, to move to the outlying areas and, thus, decongest the city.

“Greater Bangalore is long overdue given Bangalore’s unprecedented and unplanned growth,” says Kiran Mazumdar-Shaw, chairman and managing director, Biocon, and one of the city’s leading lights. “However, if it is not well planned and properly zoned, it will just become a real estate racket,” she adds.

Good planning is not something governments in this part of the world are known for. And in this case, there has been more talk than action. “There’s no drainage, water or proper roads [in the new areas],” says Jansen. “There will be greater strain on infrastructure. In spite of that, there is a glut of apartments; in a one-km radius, there are over 600 units coming up.”