FAW Contemplating Bengal Production Plant

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From Yahoo India

The Nano may have been driven out of Bengal before it set up shop in Gujarat but a major Chinese company ‘ First Automotive Works (FAW) ‘ is considering both states as a possible location for its first plant in India.

The company currently has a tie-up with a Calcutta-based firm for selling automobile parts that are used in buses and trucks. But if it decides to set up a plant for manufacturing passenger cars, it will be a fully Chinese-owned company and not a joint venture, Zhang Lizhong, China’s consul-general in Calcutta, said.

“FAW is considering building an automobile factory in India and both Bengal and Gujarat are under consideration,” Zhang said.

Zhang is aware of the problems that dog acquisition of land for setting up industries in Bengal but added: “Land won’t be a problem. FAW’s current Indian partner has the land required for the plant.”

During an interview with The Telegraph, he, however, said that Chinese enterprises would be “prudent and cautious” about their future investment plans in the region in view of the “difficulties encountered in the past years”.

Despite these difficulties, some Chinese enterprises are seeking re-entry into this market and planning to set up offices in Calcutta. These enterprises are adopting “localisation strategies” in order to avoid the difficulties they faced in the past.

He mentioned Dongfang Electric Company Ltd, one of the leading Chinese manufacturers of power plant equipment, which sent a delegation to India recently. The company is said to be considering plans to set up a plant in India. It has already begun work on building a service centre in Rajarhat and hopes to complete it in two years.

About the author  ⁄ FrankF

Frank entered the automotive industry via his father's instructions. He grew up with cars around him, especially as his father was a major auto restorer, Frank's childhood was spent passing beers, tools and coffee to his father whilst he explained the ins and outs of engines. Frank now works in the Chinese car industry at a specific manufacturer.

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