The centre here, which will initially have 1,000 employees, will expand the company's ability to provide clients around the world with technology services and solutions in application management and development.

At the end of last year, IBM had 23,000 employees in India. It already has four global delivery centres in Bangalore, Pune, Gurgaon and Kolkata.

Inaugurating the Hyderabad centre, Frank Kern, IBM vice president (Asia Pacific), said his company was focusing on India as it was in a leadership position in the skills and talents in serving global clients.

"We have been focusing on India as a domestic market place. In the last few years, our business here has grown by 49 percent," he said.

"The work at the Hyderabad centre will focus on designing, building, running, transforming, enhancing and supporting the clients' business applications," said Shankar Annaswamy, managing director, IBM India.

Andhra Pradesh Chief Minister Y.S. Rajasekhara Reddy said his government was proactively trying to provide infrastructure to IT companies.

He said the government was keen to expand the IT/ITES sector from Hyderabad to second-tier cities like Vishakhapatnam.

Reddy said the government would soon lay a 160-km eight-lane express highway around Hyderabad.