Alstom plans R&D centre in Bangalore

Alstom, the French energy infrastructure major, has drawn up plans to locate some research & development (R&D) work in India, upscale its capacities in the country and make its Vadodara factory a global engineering and manufacturing centre for hydel power machinery.

The decision was taken after a weeklong visit of a high-level 10-member team, led by Philippe Joubert, executive vice-president, Alstom.

However, as the proposal for upscaling the Indian operations were yet to be submitted to the Alstom board, Joubert said that it was too early to talk about the investments involved.

"However, this will involve taking up several hundred engineers," he told a select gathering of newspersons here on Wednesday.

He also announced that Alstom had received an order worth around Rs 1,000 crore to build a 469 mw combined cycle power plant for Gautami Power Ltd at Peddapuram in the East Godavari district of Andhra Pradesh.

Talking about the R&D facility, Joubert said that it would most probably be located at Bangalore. When asked what be the nature to be work carried out at the centre, he said that it would involve both information technology as well as core engineering work.

Alstom has also decided to make its Vadodara unit a global production base for hydel power generation equipment. According to Joubert, there are four economies in the world which are emerging as the hub for hydel power in the world "" Brazil, Canada, China and India.

In this light, the Vadodara facility is being upscaled into a global unit.

Though he admitted sourcing from India would have a tremendous cost savings, Joubert said that exports out of the Vadodara factory would not be more than 10-20 per cent of the output.

"There is no example of a successful export base unless there is a good national base. A factory only for exports could be extremely risky," he added. The limited exports out of Vadodara would be to other Asian markets and Africa, he said.

Joubert and he visiting team have also decided that the Vadodara factory will also be Alstom's centre in India for the engineering and manufacturing of rotating machines (turbines and generators).

Alstom's capabilities for boiler engineering and manufacturing in India are proposed to be further enhanced, even as similar plans are being drawn up for plant engineering, project management and procurement functions located in Delhi.

Talking about the possibilities in India, Joubert said that the country has all it takes to become a high growth area for Alstom.

"There is high GDP growth, ageing power plants, rising concern about the environment and increased privatisation," he added.