New Delhi: US mobile phone technology company Qualcomm plans to set up a software development and chip design unit in India to benefit from the country's relatively cheap development costs, a top company official said.

Paul Jacobs, group president for Qualcomm's wireless and Internet business, told reporters on March 17 the centre was in a "very late stage of consideration".

"We are actively looking at possibilities for chip and software development services," Jacobs said, pegging the number of people to be recruited at over 100. "The amount to be invested would be significant," he said.

India's rapidly improving telecom infrastructure and a growing army of lower cost English-speaking workers has been a magnet for global corporations seeking to reduce costs.

Many companies source their software requirements from India's booming software services industry, or have set up their own units in the country.

Qualcomm is already a major player in India's flourishing wireless sector, the fastest growing market in the world, through its chips in CDMA handsets being sold by several operators in the country.

Qualcomm owns most of the patents to CDMA (Code Division Multiple Access), the world's second most widely used wireless technology standard. It supplies about 90 per cent of the chips for CDMA phones.

The technology is being used by Reliance Infocomm Ltd, India's top CDMA-based mobile services firm, to provide wireless facilities to 6.5 million users out of India's total installed base of more than 31.5 million customers.

Jacobs said he expected 13 million CDMA handsets to be sold in India in the year to September, 2004, because of roaring demand for mobile services in the country where three in 100 people own a mobile phone compared with more than 20 in China.

He said Qualcomm had shelved plans to take a minority stake in Reliance Infocomm as the company had already rolled out its nationwide network without Qualcomm's cash. "At this point there are no discussions. At the end of the day they (Reliance Infocomm) were able to launch the network without any investments from Qualcomm," Jacobs said.

Qualcomm had plans to invest up to $ 200 million in Reliance's telecom business in exchange for a four per cent stake.