India Grows as Global R&D Hub for Multinationals

India Grows as Global R&D Hub for Multinationals

The Nikkei Asian Review reports that numerous multinationals have chosen  India as an attractive R&D destination. More recently, taking advantage of employment costs, as well the availability of technical skills, many companies across a variety of industry verticals have begun to set up their R&D centers or have enhanced their existing facilities in India. IT consulting firm Zinnov estimates that by 2020, India’s R&D services market will more than double from the 2014 level to $38 billion.

Earlier this year, Huawei Technologies, the Chinese telecom equipment maker opened an R&D campus in Bangalore, with an investment of $170 million. The company plans to hire up to 5,000 engineers for the new center. Chinese smartphone maker Xiaomi said it will open an R&D center in Bangalore which would customize products to suit local demand.

Expecting its users in India to reach around 40 million by 2018, Twitter, the U.S. social network provider announced plans to set up a research and design center in Bangalore.

In efforts to expand its presence in South  Asia, German chemical company BASF opened a research and development center for agrochemicals in Lonikand near Pune in the western state of Maharashtra, this year in May. BASF’s global R&D center, which the company opened outside Mumbai last year is working to create innovative solutions, for example, for organic synthesis. Another outfit from Germany Mercedes-Benz Research & Development India, a Daimler unit, is adding  1,700 engineers to its R&D centers in India by 2016. Currently, it has about 2,300 engineers in Bangalore and Pune.

In May 2015,  Ford Motors declared it will invest $786 million in building an R&D center in Chennai, Tamil Nadu.  Other companies such as Broadcom, Amway and Robert Bosch, have announced similar plans to bolster their product development capabilities. And it’s not just big companies that are investing in Indian R&D, California-based Cohesity, a start-up that deals in secondary storage space,  is expected to invest $10 million over the next two years in research and development.


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