The Hindu Business Line : SAP to invest addl 20 m euro in Bangalore

(From left) Mr Clas Neumann, Joint Managing Director, SAP Labs India; Mr Peter Zencke, Member of the Executive Board, SAP AG; Mr Henning Kagermann, Chairman of the Executive Board of SAP AG; and Mr Hans-Peter Klaey, President and CEO, SAP Asia Pacific, at a press conference in Bangalore on Tuesday. - - V. Sreenivasa Murthy

Bangalore , Aug 3

SAP AG plans to invest an additional 20 million euros to expand its development operations in Bangalore. The company also plans to more than double its headcount in Bangalore to 3,000 by end-2006, according to the CEO, Mr Henning Kagermann.

SAP Labs India, the company's development arm, has close to 1,100 professionals in Bangalore, its second largest development centre outside Waldorf, Germany.

The company has already invested close to 20 million euros in two phases in setting up and expanding the Bangalore centre, which houses about 12 per cent of the company's R&D staff.

Speaking to newspersons on Tuesday, Mr Kagermann, who is on his second visit to India, reinforced the importance of India as a key growth market and strategic development centre for SAP.

"India is the cornerstone of SAP's global strategy and is one of the fastest growing markets in Asia."

The country has emerged as the global hub for SAP in providing services, business support, consulting and hosting among others, he added.

"The quality of the projects delivered from the India centre has been excellent and is helping us in bringing products faster to market."

To a query, Mr Kagermann said that cost saving was not the major reason for expanding operations in India.

He added that the company was able to ramp up operations faster in India when compared to other nations, especially China.

Commenting on the global market conditions, Mr Kagermann said that the overall IT spending had improved in the first half, especially in the US, whereas Europe was showing signs of stabilisation.

Meanwhile, Mr Kagermann is said to have met several IT honchos in India and the company is likely to sign up an Indian vendor as one of its global integration partners.

It may be recalled that Indian software services vendors have almost doubled their SAP practice in the last one year as package implementation has picked up globally.