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Philips to invest up to $300M in India

Posted: 08 Sep 2003 ?? ?Print Version ?Bookmark and Share

Keywords:philips electronics? software? india?

Continuing the trend toward outsourcing more development work here and elsewhere in Asia, Philips Electronics said it would significantly expand its operations in India with new investments totaling as much as $300 million.

The Dutch electronics giant already has a major software development center in the country employing about 1,000 engineers, or about 25 percent of its global software development workforce. It now plans to double staffing levels in India over the next five years.

Much of the new investment will go into research projects, Philips said. The Bangalore center, established several years ago, is the only Philips software center with a Level-5 certification under Carnegie Mellon University's Capability Maturity Model. The center also holds 15 patents and claims to have more in the pipeline.

Investments so far are estimated at about $150 million. Revenues from sales of various Philips products in India are estimated to be $500 million. While Philips has been a household name in India for decades, it has recently come up against strong competition from rival Korean electronics giants such as Samsung and LG. Both Samsung and LG have high-volume production operations in the country.

A senior Philips executive team, including president and CEO Gerard Kleisterlee, is currently on a week-long tour of India.

In addition to its own development center, Philips also outsources some development to Wipro Ltd, and is studying whether to outsource more development to Indian software companies.

Philips executives said a presentation to the company's board is planned at the conclusion of their visit. If approved, the new business plan is expected to include manufacturing of some electronic products in India.

- K.C. Krishnadas

EE Times

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