Bangalore, India is set to get a substantial boost from Huawei as the company plans to invest $500 million over the next five years. Forbes reported that Huawei will expand its research and development center in Bangalore, creating jobs and infusing the local economy with much needed capital.

According to Ross Gan, a spokesman for the Shenzhen-based company, the investment is part of a long-term commitment made by Huawei to position its operations in India as a hub for the company’s global operations.

This expansion is expected to double the size of the company’s headcount in Bangalore from the current level of 2,000 staff. When the expansion is complete, Huawei will support up to 6,000 employees in India.

Known as one of China’s most successful technology companies, Huawei said last week that it anticipates a growth in contract sales to $36 billion in 2010 from $30 billion last year. Revenue by the company is only recognized after projects are completed and as a privately-owned company, financial results are only released once a year.

Concerns are being raised by foreign telecom players in India due to heightened political and security issues. In December, the Indian government announced plans to impose tariffs of 50 percent on Huawei’s synchronous digital hierarchy (SDH) transmission equipment. The company’s rivel, China’s ZTE Corp., was hit with a 236 percent duty on its SDH products.

The company has also attempted to gain strength in the U.S. market and made a bid for Marlborough, Mass.-based 3Com last year. This move was part of a joint venture with Boston-based Bain Capital. The transaction was never completed, however, as the White House’s Committee on Foreign Investment blocked the deal.

Huawei’s history in the industry is one intrigue. Reclusive millionaire Ren Zhengfei founded the company and by supplying many of the state-owned enterprises in China, has been able to build the company into the world’s second-largest vendor of mobile network equipment. In this industry, it is second only to Sweden’s Ericsson.

Huawei operates as a network equipment supplier to many of India's biggest telcos: Bharti Airtel, Vodafone, Essar and Reliance Communications. It is also bidding for a contract to supply 93 million lines to state-owned Bharat Sanchar Nigam's mobile-phone network.

In other Huawei news, the company announced it has teamed with T-Mobile and Ubiquisys to conduct femtocell interoperability testing at T-Mobile’s labs over the next six months. Klaus-Jürgen Krath at T-Mobile said the company is an active member of the Femto Forum and the standards bodies. The company has completed comprehensive femtocell trials with Ubiquisys and Huawei.

Source:tmcnet