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Beyond India: Indian Outsourcer Turns To Malaysia

Tech services vendor Satyam Computer Services said Thursday that it plans to open a center for offshore application development in Malaysia that will be the company's largest facility outside of India.

The 2,000-seat center will be located in Cyberjaya, about 50 kilometers south of Kuala Lumpur, and will provide services to Satyam customers in the United States, the Middle East, and Asia. It will be Satyam's second facility in the South Asian country. A spokeswoman for Satyam said the 15-acre facility is under construction and should be completed in about 12 months.

In a statement, Satyam chairman Ramalinga Raju said the decision to locate the new facility in Malaysia was based on the country's "advanced infrastructure, rich [information and communications technology] talent pool, and competitive cost environment." Satyam is opening the center in cooperation with Malaysia's Ministry of Science, Technology, and Innovation.

Satyam is one of a number of companies that are responding to rising salaries and a tightening labor market in India by looking at alternate offshore locales, a trend that's working to Malaysia's benefit. Dell, Cisco, and DHL are among the major companies that have established operations there in recent years.

Consulting group A.T. Kearney last year ranked Malaysia as the world's third most attractive outsourcing destination, behind India and China, based on cost, available skills, and overall business environment.