IBM sales in India may approach $1 bn this year

International Business Machines Corp (IBM), the world's biggest computer-services company, said sales in India would approach $1 billion for the first time this year.

Sales of hardware, software and services in India increased 39 per cent in the first three quarters, said Vice-President Jesse Greene in an interview. IBM had sales of about $700 million last year in the country, Asia's third-biggest economy, he said.

The expansion is helping offset slowing US sales for Armonk, New York-based IBM, whose total revenue was little changed last year. Chief Executive Officer Samuel Palmisano told analysts in May that the company wanted to double its sales in India, Brazil, Russia and China by 2010.

"India has a strong base of skills to service our customers around the world,'' Greene said.

IBM's sales numbers don't include revenue from worldwide outsourcing contracts completed in India. Revenue from those projects was more than $700 million in 2006 and is growing at a faster rate than domestic sales in India, Greene said.

India's economy is expected to expand 8.8 per cent in the year ending March 2008 and 8.6 per cent in the following 12 months, the Organisation for Economic Cooperation and Development said yesterday.

IBM increased its workforce in India to 53,000 in 2006 from 3,000 in 2002. The company has at least 35 offices in the country, nine of which opened in 2006.

"India is very important to us, not only for its domestic sales but providing a competitive cost structure and skills set to compete globally in the services business,'' Greene said.

IBM reported that its Asia-Pacific revenue increased 9 per cent in its third quarter. The Indian sales grew 48 per cent, or 30 per cent if currency rates are held constant.