Bengaluru Leads India's Socio-Economic Rankings, Driven By Thriving Service Sector: Report

Despite volatility in the start-up ecosystem over the past two years, Bengaluru's economic profile has remained robust, as evidenced by record home purchases

In 2023, Bengaluru recorded 54,046 residential sales, marking a nine-year high, according to Knight Frank

Source : Britannica

Bengaluru stands out as a leader in socio-economic growth, driven by its vibrant service sector that attracts a highly skilled workforce from across India and beyond, according to the real estate consultancy firm Knight Frank's Prime City Index report. The city leads the nation with the highest workforce participation rate at 76 per cent. It boasts an unemployment rate of just 1.8 per cent, the lowest among the six cities (Delhi NCR, Mumbai Metropolitan Region, Hyderabad, Bengaluru, Ahmedabad, and Chennai) analysed. 

"Despite recent challenges in the start-up ecosystem, Bengaluru’s economic profile remains resilient due to its diverse business activities, as evidenced by strong real estate sales in recent years. The city continues to solidify its reputation as a prime destination for global investments and talents," said Knight Frank in a statement.

Despite volatility in the start-up ecosystem over the past two years, Bengaluru's economic profile has remained robust, as evidenced by record home purchases. In 2023, Bengaluru recorded 54,046 residential sales, marking a nine-year high, according to Knight Frank.

The city's economic strength is further highlighted by its position in the Hurun India Rich List 2024, where Bengaluru ranks fourth, just behind Hyderabad, with 100 wealthy individuals, including 27 billionaires.

Bengaluru is also the top choice for commercial occupiers, accounting for 21 per cent of overall transactions across major cities. The city's office market remains strong, driven by an accelerated return to office by firms, growth in India-facing businesses, and a steady influx of multinational companies into the country.

Hyderabad has emerged as the fastest-growing city in India, according to the report. Fueled by strong infrastructure development, booming real estate demand, and a significant rise in ultra-high-net-worth individuals (UHNWIs) and high-net-worth individuals (HNWIs), the city has become a premier destination for investors and residents.

In 2023, residential sales saw a 6 per cent year-on-year increase, driven by homebuyers prioritising lifestyle upgrades and favouring amenity-rich communities in well-established areas. 

Hyderabad led the way in real estate growth, with a 10 per cent compound annual growth rate in residential launches over the past decade. Bengaluru ranked second, supported by its thriving tech ecosystem and highly skilled workforce. Meanwhile, Delhi-NCR continued to lead in physical infrastructure, boasting an extensive metro network and world-class healthcare facilities.

A key driver behind Hyderabad's real estate boom is the growing influx of UHNWIs and HNWIs choosing the city as their home. According to the Knight Frank report, Hyderabad has witnessed a surge in wealth among its residents, with more affluent individuals seeking luxurious properties. These high-net-worth individuals are drawn to the city’s economic potential, quality of life, and relatively affordable real estate compared to cities like Mumbai and Delhi.

Meanwhile, Delhi-NCR remains at the forefront of India's physical infrastructure, particularly due to its expansive metro network and world-class healthcare facilities. The region continues to attract business and investment with its exceptional connectivity and top-tier amenities, solidifying its position as a major hub in India's urban landscape.

"Delhi-NCR’s e-governance initiatives, such as the Delhi Government Services Portal, provide streamlined and user-friendly access to public services, with regular updates enhancing user experience. Alongside Delhi, Hyderabad and Ahmedabad also ranks among the top cities for information security and privacy, showcasing its commitment to digital advancement," said the report.