Microsoft to invest $1.7B in India

It also plans to increase staffing there over the next few years

Microsoft Corp. will invest $1.7 billion in India over the next four years, Chairman and Chief Software Architect Bill Gates said today in Delhi.

The money will be spent on Microsoft's development operations in India and other areas in line with the company's strategic vision for India, Gates told reporters.

Microsoft is one of several multinational technology companies that are making large investments in India in anticipation of a boom in the country's IT and communications markets. Others include Intel Corp. and Cisco Systems Inc.

Intel announced Monday that it will invest over $1 billion in India. Of that amount, $250 million will go to a venture capital fund in India and $800 million over the next five years will be used to expand its business in India, including its research and development center in Bangalore. The company said it has already invested more than $700 million in the country over the last 10 years.

During a visit to India in October, Cisco President and CEO John Chambers said his company will invest $1.1 billion in the country over the next three years, including $750 million in expanding its R&D operations there. The company also this week announced a $10 million investment to support the Indian government's e-governance programs and an additional $50 million investment to set up a facility in Bangalore to house the company's R&D, IT, sales and customer support staff.

Gartner Inc. expects total Indian enterprise IT spending, not including consumer IT spending, to reach $25.4 billion by next year. That will include spending on hardware, software, telecommunications and IT services, according to Gartner.

Gates, who is on a four-day visit to India, told an Indian industry forum today in Delhi that Microsoft plans to increase its staff in India to 7,000 from 4,000 over the next three to four years. It isn't clear, however, whether the staff will all be employed by Microsoft or will also include employees of outsourcing companies in India that work for Microsoft.

Copyright © 2005 IDG Communications, Inc.

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