Cisco in spread mode, to set up Bangalore unit
(Friday, June 18, 1999)
Our Corporate Bureau in New Delhi
Cisco Systems Inc of the US, the global networking giant, has decided to invest $20 million in India to set up an engineering development centre in Bangalore and expand its operations.
The expansion plan includes increasing staff strength to over 100 in India and upgrading its representative office into a wholly owned subsidiary.
"About 17 months back, the company decided to make major investments in the Asian region and since India is a fast-growing market offering challenges, we have decided to focus in this part with increased investments," Cisco Systems' managing director (Asia), Todd Abbott, said.
According to him, Cisco has been growing at a clip in excess of 100 per cent in India. Abbott pointed out that India is part of the "Greater Asia" region (excluding Japan, New Zealand and Australia) which itself is one of the fastest growing markets for Cisco where, by the end of July (when the company's financial year comes to a close) the growth would have been in the range of 40-50 per cent.
The fresh investments in expanding and opening its R&D outfit in Bangalore would be made in the coming 12 months, he added.
Abbott said the Indian centre would conduct development and testing work relating to Internet operating systems software, applications-specific integrated circuits and other technologies such as voice-over Internet protocol.
Though in some parts of the world, Cisco has gone in for acquisitions to get new technology, in India, the company does not have any such plans, Abbot said.
He said Cisco's acquisitions do not have any budgetary constraints; "rather, they are more market driven".
The availability of cost-competitive talent and growth in the Asia-Pacific weighed high while the decision was made to locate the R&D centre in India. "Moreover, we are facing constraints in recruiting the right sort of people in the US," Abbot said.
According to Cisco, growth of Internet service providers was fuelling demand for its hardware and software.
Cisco spends substantial amount on research, and their R&D expenses stood at 11.2 per cent of their total expenses last year.
The work at the Bangalore centre would complement development agreements already in place with local partners.
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