Huawei India Huawei S7 tablet Huawei Android smartphone Huawei to set up $500m plant - The Times of India "Huawei to set up $500m plant Shalini Singh, TNN, Sep 20, 2010, 01.12am IST NEW DELHI: Chinese telecom equipment manufacturer Huawei has tipped the telecom equipment security debate strongly in its favor by deciding to set up a local manufacturing base in Chennai with an investment of $500 million. This will be the first large investment in telecom manufacturing since telecom minister Dayanidhi Maran left office as telecom minister in May 2007. Confirming the development, A Sethuraman, executive director, Huawei India, told TOI that this multi-product facility, which is to be constructed across an area of 30,000 sq ft near Sriperumbudur will become operational before the end of December. According to him, the investment will be staggered over the next 5 years. Tamil Nadu is often called India's Shenzen after Maran attracted a host of telecom manufacturing investments to the state from 2005 onwards, including Nokia, Ericsson, LG, Sony Ericsson, Motorola, Alcatel Lucent, Nortel and others. Huawei already has an R&D centre in India which is its biggest outside China, employing 2,000 people. Its India operations have been drawing overall investments of $150 million/year over the past decade. According to the company, it has a total employee base of 6,000 people of which 95% are Indians, while creating indirect employment for 20,000 additional people through its partner ecosystem. Huawei sells equipment in over 100 countries and claims to serve 46 of the world's top 50 telecom operators. Its global turnover in 2009 was $30 billion of which India sales accounted for roughly 7%. Huawei's turnover for 2010 is projected to hit $36 billion, though India failed to generate any significant contracts until just a month ago owing to home ministry fears that Chinese equipment makers were placing malaware and spyware in their equipment. While all foreign telecom equipment orders were practically suspended over these concerns, Chinese firms faced the real threat of an outright ban, despite the fact that most of India's telecom operators already use Chinese equipment. On August 3, the ToI had reported that Huawei had turned this threat into a huge opportunity by becoming the first firm to concede to the home ministry's demand to share its source codes with them. Apart from its inherent price advantage, this helped Huawei score heavily against its competitors who refuse to share their source codes. Huawei's decision to manufacture locally will give it a further edge as it is aimed at checkmating not only its big European and US competitors but also removing any shadow boxing opportunities for India's security agencies. With local manufacturing and investments, the government will have greater access to Huawei's manufacturing operations but also much less room for taking refuge in conspiracy theories. This will force the Indian government to now take a clear stand on how it will deal with its security risk perceptions relating to Chinese equipment makers. "The manufacturing facility will provide a time-to-market advantage to our customers, faster return on investments and future-proofing of technology or removing obsolescence by enabling compatibilities and smoother integration," says Sethuraman."