This development is expected to help the company enhance its revenues in the Indian marketplace. IBM is yet to decide about the headquarters of the new arm. IBM India, the wholly-owned subsidiary of IBM, is located in Bangalore with its managing director and chief executive officer Ranjit Limaye operating mainly from Mumbai.

An IBM source said the company has not taken any decision about the corpus for the new project. IBM Global Finance will fund its customers through the vendor leasing and financing route. However, the company will continue its alliance with TransAmerica for offering its products through the hire-purchase system.

Industry analysts said this could be a major new tack for a global infotech firm. No other multinational firm has this kind of outfit in India to offer funds to push the sales of projects and products. It will also help the company get a major marketshare from start-ups.

"Globally we have been assisting the customers to buy products and services from us. We will continue the same strategies in India," the IBM sources said. The official spokesperson, when contacted, confirmed the development.The recent marketing initiatives unfolded by its competitors has resulted in a shift in IBM's focus in India. IBM is looking at increasing its marketshare in the server market. IBM recently announced the launch of a new line of midrange Unix Rs/6000 servers. Available in flexible rack and stack or deskside configurations, the new RS/6000 midrange lineup offers power and scalability for both dotcoms and corporate data centres.