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One of the world’s top computer makers, Dell says its first India made computers will roll out of its new factory in Chennai from July. However it says computer sales and new investments in the hardware sector are unviable due to high tax rates on computers in India.

Dell will also manufacture laptops and servers in the new facility, a company official said.

According to company CEO Michael Dell, India sales totaled USD 500 million last year, an increase of 70 per cent from the previous years. Dell is rather optimistic of future sales in the country and claims it will hit the USD 1 billion mark.

Dell believes the slackening of its market share in India is because the country levies both import tariffs and sales taxes that make up 20 per cent to 25 per cent of the cost of a computer.

“This year we will spend USD 19 billion with suppliers in China and Taiwan. Unfortunately, the comparable figure for India is nil. So India is missing an opportunity to attract our 86 suppliers who have signed statement of support with us. In fact, one of the suppliers is planning a USD 5 billion investment in Vietnam, and not in India,” Dell said.