Wen started his second day in Bangalore with a visit to the International Technology Parks unit of IT services firm Tata Consultancy Services [Get Quote].

He told TCS's top brass at its global development centre at ITPL, "There are a lot of intelligent people in India and China and the world provides an ever broadening market for the IT industry."

Referring to the Chinese strengths in IT hardware and India's in software, he said, "If India and China cooperate in the IT industry, we will be able to lead the world in the sector and a day will come when we can herald the beginning of the Asian century of IT."

The Chinese Premier said, through a translator, he was pleased that the Tata Group had successfully sorted cooperation with China. "This demonstrates that we have the desire and the foundation for cooperation between the two great nations," he said.

Acknowledging the Indian software industry's "important position in the world," Wen said China, too, had "made rapid progress in the IT industry." A few years ago, China produced five million cell phones and today "We are producing over a 100 million cell phones every year."

The country had 500 million phones and half of them were cell phones. China's Internet usage, too, had gone up and some 100 million Chinese had access to the Net, he said.

S Ramadurai, chief executive officer and managing director of TCS, said the Tata Group was considering investments in China through other group companies also, such as Tata Motors [Get Quote] and Indian Hotels.

Ramadurai was accompanied by V Rajanna, country manager of Tata Information Technology Shanghai Co, a wholly owned subsidiary of the Tata group company. TCS has invested some $2 million in TITL to date, Rajanna said.

He told reporters at ITPL, the China subsidiary was the first Indian IT firm to start operations in China, in 2002. TITL has some 200 engineers, three fourths of them Chinese nationals, delivering solutions including software and engineering services to TCS' global customers.

TITL operates from a global development centre in Hangzhou, a liaison office in Beijing. A centre of excellence in Oracle 11i was also located in Shanghai, a company release said. TITL was serving TCS' multinational customers in China, such as General Electric and the American Insurance Group, Ramadurai said.

Further, "The subsidiary was also positioning itself as the sourcing base for servicing neighbouring markets such as Taiwan, Japan and South Korea. This was becoming possible as many Chinese in the northern provinces of China spoke Japanese and Korean," Rajanna said.

China had also become the first engineering services centre for TCS outside India. The firm was collaborating with leading universities there, including Zhejiang University, for carrying out applied research and development, the company release said.

TCS had also sponsored Chinese students to work at the Tata Research Development and Design Centre in Pune.

Jiabao arrived in Bangalore on Saturday, from a visit to Sri Lanka. After visiting a Bangalore facility of the Chinese telecom equipment maker Huawei Technologies, the ISRO Satellite Centre and the Indian Institute of Science, he proceeded to Delhi on Sunday afternoon for the remaining two days of his Indian visit.