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Last Updated: Thursday, 1 November 2007, 11:23 GMT
Cisco expands in China and India
Jack Ma (left) from Alibaba and John Chambers from Cisco
Most of Cisco's new investments will be through partnerships
Cisco Systems is planning major investment in China and India as it focuses its attention on the world's two fastest-growing major economies.

The US firm intends to step up procurement from Chinese suppliers, develop its product research capacity and launch several joint ventures.

It has also made a similar pledge to ramp up its presence in India, where it plans to triple its workforce by 2012.

Cisco said it was committed to "truly globalising" its business.

'Strategic importance'

China and India are key battlegrounds for global technology firms, because of their massive domestic markets and the attractive low-cost manufacturing locations they offer.

Cisco has been in China since 1994 and claims to have invested an estimated $8.5bn there in the past five years.

Cisco is not planning a major expansion of its own manufacturing capacity but outlined a range of other initiatives including:

  • Procuring more materials and components from Chinese companies
  • A provisional 100m joint venture plan with China Development Bank to supply finance and support for innovative Chinese firms
  • A provisional alliance with online business network Alibaba to buy a stake in the Chinese firm and jointly supply business solutions to small companies
  • Funding an extra 300 networking academies in Chinese vocational colleges, training 100,000 students by 2010
  • Setting up Cisco's first "green" technology centre to focus on sustainable development

Cisco said China's economic potential offered it huge opportunities, but it was equally committed to helping to tackle the country's social and environmental challenges.

"This program will lay the foundation for the next chapter in Cisco's development in China," said John Chambers, Cisco's chief executive.

"The announcements underscore both China's strategic importance to Cisco's global operations and the broad range of growth opportunities presented by the China market."

Under plans unveiled on Wednesday, Cisco's Indian workforce will increase from 3,000 currently to 10,000 by 2010.

Cisco intends to use its new factory in Bangalore as a research and development hub for products aimed at emerging markets in Asia, Africa, Latin America and the Middle East.

The firm, which also plans to invest $100m in healthcare projects, said India was "at the heart of our globalisation vision and provides a platform for Cisco to capitalise on the growth potential in the emerging world".

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