Cisco to invest US$1.1 billion in India

Network equipment manufacturer Cisco is set to make its largest investment to date outside the United States.

Company start-ups in India will benefit by US$100 million, and a factory may follow. In addition to the financial investment, over the next three years Cisco will double its Indian payroll staff to 2,800. The US$1.1 billion will be spent on several initiatives, including US$750 million on research and development. Another US$150 million will be dedicated to Cisco Systems Capital, a division of Cisco Systems that provides leasing and other financial services to Cisco customers and partners. Two equal tranches of US$100 million will be set aside for investments in Indian start-ups and customer support activities.

Cisco CEO John Chambers looks to the future in a country where sales have increased 50% in each of the last two years: "India may become the largest market for Cisco in Asia...we expect our Indian business to grow at 30% and above over the next three to five years. This compares well against the growth of 10-15% that we see in the traditional developed markets."

Of course, in an economy which is growing 7% annually network equipment is as crucial in overall national terms as it is to the Indian software industry. India is also set to become a major purchaser as e-governance initiatives spread across the country. Cisco is committed to building network infrastructure for up to 100 villages in India to help rural people get online access to government services.

"Affordable access to information infrastructure will play a critical role in India becoming a developed country," states John Chambers. "The government has embarked on a massive e-governance exercise aimed at connecting the country and bridging the digital divide. Cisco is proud to collaborate with the Indian government in its endeavour to e-enable the country."

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