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Chip maker plans to grow its local operations and boost its venture-capital investments.
Stephen Taub, CFO.com | US
December 5, 2005
Intel Corp. is the latest tech giant to boost its investment on the subcontinent.
Chairman Craig Barrett told reporters that the world's largest chip maker plans to plunk down more than $1 billion for research and development and other projects, according to Reuters. "We will grow our local operations, boost venture capital investments, and work closely with the government, industry, and educators," he reportedly said.
In a press release, the company announced that it has established a $250 million venture capital fund to help stimulate continued technological innovation in India. The fund will invest in companies that can benefit from the rapid growth in India's own IT market and will provide local businesses with capital to help nurture technologies and products developed for local use. Intel will also use the fund to invest in technology-oriented service companies that target overseas markets, including cellular communications, broadband applications, and wireless technologies.
Barrett told reporters that another $800 million would be invested during the next five years to expand research and development in Bangalore in addition to marketing, education, and community programs.
Intel has invested more than $700 million in India during the past 10 years, according to the Associated Press. Intel Capital made its first strategic investment India in 1998 and since then has invested in more than 40 Indian companies in seven cities.
Several of these companies have since gone public or been acquired. According to Intel, these include two that were acquired by other companies last year: Deccanet Designs, a communications design and software services company, and FutureSoft, a telecommunications product and services company. India Infoline.com Ltd., an online portal, and Sasken Communication Technologies Ltd., a telecommunications product and services company, went public on the Indian stock market this year.
In October, Cisco Systems Inc. announced that it would make a $1.1 billion direct investment in its subsidiary Cisco Systems India during the next three years. Chief executive officer and president John Chambers told reporters that the parent company planned to triple the staff count at the New Delhi-based subsidiary, which now employs more than 1,400 people, by outsourcing research-and-development work to Indian engineers and through other new hires. He added that $750 million of the $1.1 billion investment would be earmarked for R&D activities, including training, development, and staffing.
Meanwhile, J.P. Morgan Chase & Co. announced it hopes to hire 4,500 graduates in India over the next two years, mostly in Bangalore, according to Reuters. The firm's retail, corporate, and investment banking operations in Mumbai now employ a similar number of workers.