The proposed facility aims to address the strong market demand in India and will manufacture high-end equipment.
Nokia Siemens Networks will also establish a network of suppliers with focus on increased localised sourcing. The construction work at the site will begin later this year and commercial production is expected to begin in 2008.
The investment will also go towards development of an existing research and development centre and expanding the global networks solution centre, a statement said quoting Nokia Siemens Networks CEO Simon Beresford-Wylie, who is on his first visit to the country as head of the newly-formed company.
"To address the growing local demand and reduce the overall time to market of products and services to our operator customers, we are investing in strengthening our local presence and creating a strong ecosystem in India," said Beresford-Wylie.
Nokia Siemens Networks has experienced strong business success since the launch of its operations in India, said company head (India sub-region) Ashish Chowdhary.