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Intel may set up chip plant in India

November 18, 2004 17:31 IST
Last Updated: November 18, 2004 19:29 IST


Intel Corp CEO Craig Barrett with India's Minister of Information Technology Dayanidhi Maran. Raveendran / AFP / Getty ImagesIntel, the global chip manufacturing major, on Thursday said it was evaluating India as one of the possible destinations for manufacturing chips while exuding confidence that the company was on track for improved performance worldwide.

"I am not going to say no to that question (whether Intel plans to set up chip manufacturing facility in India). India is one of the several countries that we are currently evaluating from a manufacturing perspective," the company CEO Craig Barrett told reporters in New Delhi.

"But nothing is going to happen overnight or we are not ready to announce the location of our next manufacturing plant in Asia. India is just one of the several competitors where we are evaluating setting up manufacturing plants," he added.

On the expansion plans at its Bangalore development centre, Barrett said: "We have a target but we will not divulge it. We have 2,400 employees here in India and we are substantially increasing our staff here. We will continue to focus on engineering hardware development, software development and will continue to grow our development center in Bangalore."

Lauding China, he said: "The reason that we have made additional investments in China is that China has further developed its manufacturing, utility, customs, transportation infrastructure and ease of movement of products in and outside of the country.

Intel pumped $302 million additional investment in its manufacturing plant at Shanghai in China. The total investment in China plant by Intel is to the tune of $500 million so far.

"I have seen in both countries infrastructure increase substantially. In both the countries, governments are putting a lot of emphasis on the infrastructure and particularly in IT education infrastructure. Whereas India has moved much ahead in software development and engineering, China has manufacturing expertise in high tech engineering."

On its financial performance, Barrett said: "We are on track to improving the performance which we were not meeting earlier as per our old standard."

He said still the company is on track to introduce the next generation process technology -- 65 Nanometer -- in the second half of next year. With this, Intel will be the first major corporate to have production in that technology.

"We already have two microprocessors designed on that technology. It is a process that is being debugged and getting ready for manufacturing next year," he said.

Intel has rebounded from a low period of sales and revenue last year and in the first half of 2004, it posted a revenue of $16.14 billion.

"I am looking for improved performances in 2005 over what it was in the first half of 2004," he said.

Intel posted third-quarter results on a good note as its profit rose, driven by record sales in Asia and stronger demand for notebook and server computer chips as it struggled with lackluster PC sales, excess inventory and stiff competition.

Intel, however, had forecast a little bleaker-than-usual revenue for the fourth quarter but said the change would not be far from normal.

"Intel delivered growth in both of its major businesses in the third quarter, driven by record server and mobile microprocessor shipments and market segment share gains in flash memory," said Barrett, adding, "growth was not as high as we originally anticipated due to inventory adjustments at some of our major customers and lower-than-expected overall demand for PCs."

"Intel crossed over to 90-nanometer technology in microprocessor shipments to the computing market segment for the third quarter and built 65-nanometer memory chips containing more than half-a-billion transistors each," he added.

Barrett also announced memoranda of understanding with the states of Uttaranchal, Kerala and Karnataka for extending technology to rural areas, improving education and helping bridge the digital divide.

"Technology is transforming lives in India, improving education and fuelling economic growth. We want to support the continuation of these trends," he said.

The company also announced the launch of a new education programme in India -- Intel Learn Programme -- a project based technology curriculum taught to young people in ages between 8 and 16 years in an informal community setting rather than a traditional class room.

The programme will be first implemented in Kerala.



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