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IBM Seeks To Manufacture In India

IBM Corp. is seeking government approval to manufacture computer systems and related peripherals in India.

IBM Global Services India Ltd. (IGSI), the Indian subsidiary of IBM World Trade Corp., has asked India's Foreign Investment Promotion Board for approval to manufacture, market and export computer systems, including input and output devices, networking products, software and maintenance services.

After being thrown out of India in 1977, IBM re-entered India in the early 1990s through a joint venture with the Tata Group called Tata Information Services Ltd. Later IBM bought Tata's stake in the joint venture and renamed the company IBM India Ltd. It seels hardware, software and services within India. The IGSI subsidiary formed later offers IT services outside India. The two entities together employ about 10,000 workers India.

The current application for manufacturing asks that IGSI be permitted to act as a holding company that can make investments in manufacturing in India. Most global IT companies have little or no manufacturing within India, although some have small assembly operations.

IBM's application indicates that the Indian market for computer hardware is growing fast enough to justify investments in manufacturing. IBM is a leading PC and server vendor here, along with Dell and Hewlett-Packard.

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