Dell hints it may follow Google out of China

Dell chief executive Michael Dell has hinted the company is considering relocating the company's Chinese operation to India.

According to the Indian Financial Chronicle, Dell told prime minister Manmohan Singh as much in person, with Singh revealing details of the meeting after speaking to the country's planning commission about spurring the "development of hardware and parts of the computer industry".

"This morning I met the chairman of Dell Corporation," Singh reportedly told the commission. "He informed me that it is buying equipment and parts worth $25 billion from China. It would like to shift to [a] safer environment with [a] climate conducive to enterprise, with [the] security of [a] legal system."

However, a Dell spokesperson moved quickly to play down the rumours, suggesting that the comments pointed to India's bright future as a manufacturing hub alongside China, not that Dell was considering shifting operations from one to the other.

"Mr Dell believes India also has an opportunity of becoming a hardware manufacturing hub, generating employment and adding to the country's impressive growth. Dell has not made any plans to shift its component spend at this time," the spokesperson said.

Even if Dell had to pull its manufacturing operation out of China, India wouldn't be the only alternative in the region. While the company does have manufacturing plants in the Chennai region of India, it also has operations in Penang in Malaysia.

The rumours take on added significance in the same week as Google announced it had started diverting Chinese search engine requests to Hong Kong in light of the country's ongoing refusal to stop censoring search results.

In another development, Go Daddy Group the world's largest domain name registrar has announced it is to stop selling new ".cn" domains in China.