India Concern to Design IBM Chips

India is already well known as the center of software development outsourcing, but following an I.B.M. agreement, it may soon be recognized as a hub for microprocessor design as well. I.B.M. has announced that the first design center for Power Architecture chips outside of the company’s walls will be HCL Technologies, an Indian outsourcing company. The move is part of a strategy to set up design centers around the world for the customized chips, and it comes in the midst of a boom in India’s semiconductor design industry, which is expected to triple by 2010. Chip companies are drawn to India due to the availability of skilled, English-speaking workers, who are paid a quarter of American engineer salaries, in the presence of clearly drawn intellectual property laws. Though India lacks manufacturing infrastructure, nearly 125 chip design companies are already in operation. “Outsourcing chip design to a low cost center like India with a large talent pool,” observes analyst Jagdish Rebello, “is a trend of the future.” – YaleGlobal