Cisco Bullish Over R&D Growth in India

by Manu Sharma    May 28, 2009

Despite the global recession and the cost arbitrage fading, MNCs are still bringing in huge investments into India. Cisco Systems will continue to develop products for the global market from its India R&D center.
The networking company has filed more than 110 patents from the Indian center alone and another 500 odd patents are pending with the US Patents and Trademark office.

Talking to CXOtoday, R. Lance Perry, vice president IT at Cisco Systems said, We came to India initially looking at the cost arbitrage only to later realize that this country figures among the best technology hubs of the world. We shall continue our development in India despite the global recession.

Cisco s on-campus research and development (R&D) capability is the largest presence for Cisco outside the US. It set up its first R&D centre in Bangalore initially to develop products for the emerging markets but later set up its globalization centre.

Cisco s presence in Bangalore is not just a development center but also a globalization centre in India and will roll out products for the global market, said Perry.

According to Zinnov Management Consulting, a management consulting company, in India the running cost for any R&D unit has come down by about 6% in 2008 in absolute dollar terms, and it is expected to decline further by another 10-12% in the next 12 months.

The report said global economic meltdown has led to budgetary constraints to many parent companies. In addition, the depreciation of the rupee has also favoured reduction in cost across MNC R&D centers in India.

Cisco has been using its center for developing products for emerging markets and has opened 170 academies across the country and is training about 8,600 students to overcome the talent crunch, according to Zinnov.

Interestingly, India is the home for 594 R&D facilities set up by overseas firms that have invested a combined sum of $5.83 billion in 2008. More than half a million engineers graduate from Indian engineering colleges every year and most of them are absorbed by these MNCs like Cisco.

Cisco has been absorbing engineers on a large scale and has about 4700 people in its R&D centre in Bangalore at its new integrated campus.

Companies like Microsoft, IBM, Intel, HP, AMD, Google, Motorala, Yahoo!, Seimens among others have all opened their R&D centers in India.

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