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Honeywell opens new R&D centre

— PHOTO: G. R. N. SOMASHEKAR

UPBEAT: David M. Cote (left), Chairman and CEO, Honeywell, with Krishna Mikkilineni, President and Managing Director, Honeywell Technology Solutions, at a press conference in Bangalore on Thursday.

BANGALORE: Diversified U.S. engineering company Honeywell International said it remained committed to India as a manufacturing, engineering and R&D location even as President Obama proposed reductions in tax benefits to U.S. companies investing in subsidiaries outside the country.

Speaking at the inauguration of Honeywell’s new $50 million R&D and engineering facility in Bangalore, Chairman and CEO Dave Cote said India was an integral part of the company’s global growth strategy. The company would continue to grow and build capabilities in India.

“I get worried when I hear about protectionism. It is certainly worrisome and harmful,” said Mr. Cote. “It would cause people to believe in things that would be harmful in the long run. I am a big fan of creating jobs everywhere,” he added.

Mr. Cote said anything that prevented globalisation would be harmful to standards of living around the world, even in the country that initiated it.

Honeywell expects sales of about $600 million in 2009 from India, which is slightly higher than what it earned in 2008. China and India would grow at double the pace than in the developed economies, he said, terming the two economies as bright spots in the world.

For the first quarter of 2009, the company reported a drop in profit and cut full year earnings forecast on the back of slower sales in its key business divisions comprising aerospace, automation and control solutions, transportation systems and speciality materials.

In India, Honeywell expects business to grow in all the four divisions. The company is collaborating with Hindustan Aeronautics Ltd (HAL) to produce TPE331 aircraft engines in India, as well as pursuing a programme to re-engine the Indian Air Force’s strike aircraft with its F125IN turbofan engines. At present, Honeywell has 10,000 employees in India, compared with 1,000 in 2002. It has five manufacturing facilities in the country.

The new 6.90 lakh sq. ft. facility, the largest in the company, can accommodate 3,000 people, and it would move in people from its temporary locations in Bangalore, it said.

Mr. Cote said a majority of U.S. companies was saying that the recently proposed measures were bad not only for the U.S. economy but also for the global economy.

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