The Hindu Business Line : Motorola next?

The Americans, the Europeans, the Chinese, and the Koreans are moving fast to stake their claim to the mouth-watering opportunities offered by the Indian telecom sector which has enthused the Government to expect close to $900 million worth of FDI in telecom manufacturing in 2005-06.

After Nokia, the next off the block is likely to be Motorola, which - according to Government sources - is in discussion with the Finance Ministry to set up a manufacturing base in the country.

For starters, the company is setting up the Motorola Lab, a cutting edge research and development centre, in Bangalore apart from increasing its overall investment in the country.

Motorola's worldwide CEO is expected to unveil the manufacturing plans during his visit to the country in the next few months.

BSNL is also planning a foray into handset manufacturing and has short-listed Chinese vendors, ZTE Corporation and Huawei Technologies for a joint venture to produce CDMA handsets and fixed wireless terminals.

Meanwhile, ZTE on its own has announced the setting up of a facility at Manesar near Gurgaon over 4,000 sq m.

Though the unit is currently an R&D facility, ZTE plans to manufacture CDMA, GSM and broadband equipment as well as handsets later.

Swedish manufacturer Ericsson has already announced a $50-million investment for manufacturing GSM mobile base stations at its existing facility in Kukas, Rajasthan and is considering the possibility of handset manufacturing along with its outsourcing partners.

Not to be left behind, LG Electronics India is setting up a spanking new facility at Ranjangaon near Pune for the manufacture of GSM mobile phones.

The company plans to roll out one million mobile units initially. French major Alcatel has also announced plans to manufacture GSM cellular lines in partnership with Indian Telephone Industries at its plant in Rae Bareilly.

And it's not just the mobile segment that is attracting the equipment vendors.

Alcatel, for instance, is also setting up a global R&D centre in Chennai for wireless broadband services along with C-DoT.

According to Government sources, the Ministry of Communications has received proposals to set up manufacturing units in the country from a number of other players as well.

According to a study by the Indian Cellular Association, India offers a better destination for manufacturing compared to China with nearly two million new mobile subscribers every month paired with economic factors like low-cost labour.

Added to that, the Communications Ministry recently hinted that vendors with units in India could be given preference by BSNL while awarding projects.

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