Search the Internet          Tips  Sites: Finance, Investment

Intel to invest up to $200 million in India

Shailendra Bhatnagar in New Delhi

Intel Corp, the world's No 1 chipmaker, said on Thursday it could invest up to $200 million in India to ramp up its software design centre and more than triple the number of engineers to 3,000 in a few years.

Intel's three-year-old development centre in Bangalore designs and develops software to power chips that drive personal computers and high-end network computers for Internet-based applications.

"We would have to invest something in the range of $100 million to $200 million just to support that increased headcount," Craig Barrett, chief executive officer at Santa Clara, California-based Intel, told a news conference.

Intel's centre in Bangalore, the chipmaker's largest non-manufacturing site outside the United States, currently has around 1,000 engineers.

"Our initial plans would be more on the engineering and design aspect as opposed to manufacturing and production," said Barrett, on a two-day visit to India as a part of an Asian tour.

Barrett said Intel would set up a new design team in India to work on "32-bit Intel architecture microprocessor design and development".

Several global technology giants including Microsoft Corp, IBM and Oracle have set up software development centres in India to tap the country's large pool of low-cost and high-quality engineers.

INVESTMENT OPPORTUNITIES

Barrett said the company was exploring strategic investments in local firms working on technologies that "would make commerce and communication easier on the Internet".

He said Intel "continued to actively look at opportunities to invest in both here in India, in Asia in general and the world".

Intel has invested in close to 30 Indian startups, among them privately-held Sasken Communication Technologies, out of a total basket of some 500 firms around the world.

Barrett said the Indian software sector had shown strong growth compared to the rest of the world in the past year but companies now needed to move away from offering just outsourcing services.

India's software exports grew 29 per cent to $7.5 billion in the past year to March 2002, of which some 60 per cent went to the United States.

"I would assume that for the health of the industry, it needs to increasingly move towards the value-add sector which is the creation of products and services as opposed to providing just sub-contract support," Barrett said.

Barrett met Prime Minister Atal Bihari Vajpayee and Information Technology Minister Pramod Mahajan during his visit. He will be in Bangalore on Friday.

He said his discussions with Indian officials centred around improving infrastructural facilities in India and tariffs on information technology products.

"Perhaps the government will be well served by reducing tariffs more quickly, even taking them to zero," Barrett said.

On Tuesday, Barrett told a news conference in Malaysia he expected only a modest growth in third quarter earnings over the preceding quarter and that he could not say when the slump in corporate technology spending would end.

ALSO READ:
More Money Headlines