Cisco to start manufacturing in India, eyes $1 billion production capacity

Cisco currently has some 15,000 employees in India with a presence in Bengaluru and two other locations. India serves as the second largest R&D center for Cisco next to the USA

Digital communications and technology conglomerate Cisco on Wednesday said it will start manufacturing in India, creating a “core” base. It is targeting to generate output worth $1 billion in exports as well as domestic production capacity.

Work on the new facility — to be established in Tamil Nadu —has already started and the company expects the first product to roll out within a year. The San Jose (California)-based firm will make switching networks and “cutting-edge” routers in partnership with an undisclosed contract manufacturer.

Apart from manufacturing, the company is also investing in testing, development and logistics, and expanding in-house repair operations in the country.

The plans are aimed at supporting supply-chain resiliency, as well as reducing lead times, and elevating customer experience. The company said the manufacturing plans alone may generate around 1,200 jobs in the state.

Ashwani Vaishnaw, Union minister for Communications and Information Technology, said: "We have been pursuing Cisco for a while to.invest in india and started discussions during Davos. They have agreed now to set up a.manufacturing plant and it will be a important step for india."

Cisco currently has around 15,000 employees in India with presence in Bengaluru and two other locations. India serves as the second largest R&D centre for Cisco after the US.

“As I have travelled in India this week, it is very clear to me that for Cisco and probably for most multinational companies in India, it is going to be the biggest growth opportunities we will have for the next decade,” said Chuck Robbins, chair and chief executive officer (CEO) of Cisco.

He added, “Fueled by a rapidly developing digital economy, India is a focal point of innovation and business for Cisco, and we remain deeply committed to our partnerships here.”

The CEO met Prime Minister Narendra Modi and several government officials on Wednesday.

When asked if the manufacturing plan was a part of any shift from China and Vietnam to other Asian countries like India, the CEO said, “This is not a question of moving production from anywhere. But it is to increase capacity.”

However, he did not disclose the total investment target for India.  

The company added that since commencing operations in India in 1995, it has focused on helping the country digitise at scale and speed. It includes accelerating the transformation of critical sectors like transport and agriculture through the Country Digitisation Acceleration program.

Robbins said Private 5G was a big opportunity for Cisco in India. “We think we are beginning those use cases. In public 5G service, we build virtually all the tech needed to build the network. We work with major players in India like Jio and Bharti,” Robbins added.

The manufacturing facility will build Cisco’s technology products designed to provide flexible, cost-effective delivery of next-generation services and support complex Cloud computing environments.

The products can meet companies’ dynamic demands as they strive to foster agility in an increasingly hybrid, digital-first world.