French tyre maker Michelin announced Monday plans to invest nearly 900 million dollars to build a plant to supply tyres to India's fast-growing vehicle market. The plant will make radial truck and bus tyres and mainly target the country's domestic market, a statement by Michelin, one of the world's biggest tyre manufacturers, said.
"We believe that India holds tremendous potential for the Michelin Group in terms of establishing a world-class manufacturing facility," Prashant Prabhu, head of Michelin's Africa-India-Middle East division, said in a statement. The Michelin Group is investing 40 billion rupees (867 million dollars) to build the plant at Thervoy Kandigai, 50 kilometres (30 miles) north of Tamil Nadu state capital of Chennai, the statement said.
Prabhu signed a preliminary memorandum of understanding for construction of the plant with the Tamil Nadu state government on Monday. Michelin had earlier been in the process of negotiating with the Tamil Nadu state government for land on which to build the plant. "I would like to express my deepest gratitude to the Tamil Nadu government for offering Michelin a gateway to this state," Prabhu said. Michelin will join other foreign and domestic vehicle and parts makers which have transformed Tamil Nadu into a major automotive hub. The state government has been on an aggressive drive to lure investment from abroad.