Satyam Launches China Development Center

Satyam Computer Services Ltd., India's fourth-largest software company, on Thursday began construction of a major development center, its largest outside India and first in China.

The groundbreaking for the center in the eastern city of Nanjing follows Satyam's announcement of plans for a software development center in Malaysia. Both are part of the company's effort to evolve into a global company, according to Virender Aggarwal, the company's senior vice president and regional director.

Hyderabad-based Satyam's expansion is aimed partly at offsetting rising costs in
India and at developing a base of skilled workers, Aggarwal said in a phone interview.

Like other Indian outsourcing companies, Satyam is trying to win clients outside the United States and Europe, looking to China, Australia and Latin America to diversify risks and build markets.

"China is one of the largest economies in the world and is likely to be the No. 2 economy in 20 years or so. It is very important that we are here," he said.

Satyam has 500 employees in China, almost all of them Chinese, at support centers in Shanghai, Beijing, the southern city of Guangzhou and the northeastern city of Dalian.

The abundance of jobs in India means workers job-hop often. China offers the advantages of a huge labor pool, a plus in Satyam's fight to recruit and retain labor, Aggarwal said.

"The labor market in Nanjing is relatively untapped," he said.

The center will be located in a high-tech zone that is expected to attract more than 300 software companies, Qi Lu, the Communist Party secretary in charge of the zone said in a statement.

Asia-Pacific, Africa and the Middle East contribute around 16 percent of Satyam's global revenue, while Europe contributes about 18 percent and the United States about 65 percent, he said.

Other Indian software companies are expanding in China, too. Infosys Technologies Ltd., India's second-largest software company, plans to open two development centers in China that will employ 6,000 people.

India's top information technology company, Tata Consultancy Services Ltd., has a joint venture agreement with three Chinese partners, with strategic investment from Microsoft Corp., to expand its operations in China.