You are here: Home » Companies » News
Business Standard

Mexico seeks Indian investment

Tejal A Deshpande  |  Mumbai 

have lined up their plans to enter the Mexican market. While Infosys and TCS have already done the spadework, others such as Reliance Industries, Tata Motors and Wipro are busy testing the waters.
Currently, a delegation headed by Eduardo Sojo Garza-Aldape, Mexican minister of economy, is in the country to promote trade between the two nations.
Garza-Aldape said, "We see Mexico and India entering a new era of trade in sectors such as automobile, auto components, energy, petrochemicals, electronics and information technology."
The Indo-Mexican annual trade stands at $2 billion with 37 per cent growth.
He said the Protect Investment Treaty by the two countries will ensure more security to businessmen from both the countries, while the proposed high-level groups will provide a platform to facilitate business.
Garza- Aldape said, "While Videocon is already present, Infosys has agreed to invest in the country. Other such as Tata Motors, Reliance Industries and Wipro are exploring the opportunities. A Mexican entry will give Indian access to the North and Latin America markets, apart from export opportunities to the US." He added that several Mexican auto components were closely watching the Indian market.
The Mexican government is seeking Indian investment in core sectors like automobile, autoparts and electronics. The automobile sector constitutes 16.7 per cent of Mexico's GDP, accounting for 20 per cent of the total exports.
Eduardis J Solis, head of unit for investment promotions, ministry of economy, Mexico, said, "Mexico is the tenth largest manufacturer of cars and aims to achieve the sixth or seventh position. The country's automobile exports are directly related to the American market and is the largest supplier of automobile parts to the US."
The Mexican automobile production is registering annual growth of 16.9 per cent, the autoparts production is worth $26 billion.
In 2006, the country produced 1.98 million automobile units and this year it may produce 2.35 million units.
"The main challenge in the automobile and electronics sectors is the supply chain, which can be met by new investments," said Solis. He said while the telecommunications industry is growing at 20 per cent, the total value of cell phone exports in Mexico has tripled in last two years.
V N Dhoot, chairman, Videocon Industries, said his company would expand its capacity in Mexico if the government offered enough sops. Currently, the ministry has agreed to offer 20 per cent cash benefits against the demand of 25-30 per cent benefits.
Videocon got access to French electronics major Thomson's Mexican colour picture manufacturing units when it acquired the company for $291 million.
IT major Tata Consultancy Services will set up a development centre in Mexico. A company executive said, "We are planning to establish a development centre in Mexico as part of out global networking delivery model."
In the financial year 2006-07, TCS's revenues from the Latin American market jumped by 100 per cent to $159 million. It is expected to announce the details of the project by the end of this quarter.
When contacted, Infosys official refused to comment, while Tata Motor officials were unavailable.

First Published: Thu, May 24 2007. 00:00 IST