by CIO Staff

Motorola to Manufacture in Chennai, India

Jun 07, 20062 mins
IT Strategy

Motorola announced Wednesday an initial investment of US$30 million in a new manufacturing facility at Sriperumbadur near Chennai in south India. The company plans a total investment of US$100 million in phases.

The facility, which will be operational next year, will make mobile handsets and network base stations.

In December, Motorola launched a low-end mobile handset in India. A local contract manufacturer made the C115 for Motorola, of Schaumburg, Ill. India’s mobile market is booming, with mobile subscribers outstripping fixed-line telephone subscribers. The country added 3.88 million mobile subscribers in April to take the total number of mobile subscribers to 97 million, according to the Telecom Regulatory Authority of India.

Motorola’s facility is coming up in the 300-acre Sriperumbadur Hi-tech Special Economic Zone being developed jointly by Motorola and the local state government of Tamil Nadu.

Chennai, which is the hometown of the country’s IT and communications minister, Dayanidhi Maran, has emerged as a popular location for communications and networking company facilities. Motorola competitor Nokia of Espoo, Finland, set up a manufacturing facility in the city as well as a network operation center for global customers.

Manufacturing locally helps multinational companies like Motorola and Nokia bid for contracts from India’s large state-owned service provider, Bharat Sanchar Nigam (BSNL). BSNL mandates that its suppliers to do some manufacturing in India.

BSNL’s move is part of a government strategy to boost manufacturing in the country. Telecom and IT equipment manufacturing is crucial for job creation, Maran said last month in Delhi. The government expects about an $11 billion investment in manufacturing in the next two to three years.

Motorola already has six Indian R&D centers, which employ about 3,000 engineers. The Indian centers are involved in mobile phone design.

-John Ribeiro, IDG News Service

For related news coverage, read Apple Calls Off Plans for Call Center in India and IBM Announces $6B Investment in India.

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