Cisco chooses Pune as its India manufacturing unit
US-tech giant Cisco has zeroed in on Pune for its manufacturing a unit in the country as it looks to scale up its presence here, eventually making India an export hub. The company, which has over 10,000 headcount in India, had last year said it will commence manufacturing in India.
“...We are committed to Pune. We view this as a set of strategic initiatives which together produces outcomes... We see India leading as a fast innovation leader. ...We have been looking at this (manufacturing) for several years and we knew that this was important and the site (Pune) was selected,” said Cisco Chairman John Chambers.
He, however, declined to comment on the specific details of the unit and added it (unit) is expected to locally manufacture in order “to support the Digital India vision”. Like its other global sites including in China, Cisco will outsource manufacturing to supplier partners.
“We bring an ecosystem of companies with us... We have already had a conference with 93 global suppliers at Bengaluru to lay the groundwork what digital manufacturing means, what we expect out of our supply chain...it’s a pull through effect,” Chambers said.
Asked if Cisco was betting on India as an export hub, Chambers answered in the affirmative. “It (India) has to become an export hub for other countries because otherwise you don’t hit your economies of scale. Can we do a one off for India? Of course. But that’s not what the Prime Minister wants. You have to make it a win-win. First, you manufacture in India for India and then, in India for the world,” he said.
It needs to be ensured that the supply chain and logistics are faster, the regulatory issues and barriers are moved quicker and that manufacturing happens at a cost equivalent or lower than other countries, he added. “And you create an environment with a very well-educated workforce that understands the value of partnership and democracy,” he said.
Cisco invests about USD 1.7 billion every year in India. During the December 2015 quarter, Cisco saw its global revenues grow by 2 per cent to USD 11.8 billion (excluding SP Video CPE Business for all periods), helped by growth in markets like India (23 per cent).
Its India business has continued to grow at a steady pace over the last seven quarters. Later in the day, Cisco will announce its partnership with the Andhra Pradesh government for the country’s first state-wide broadband project, AP Fiber-Net, in Visakhapatnam.