Kia Motors to invest an additional $54 mn in Andhra Pradesh facility

Some of the prominent companies having manufacturing operations in Andhra Pradesh have pledged more investments in coming years as the state government tries to improve the competitiveness and business environment in the state for industrial development.

Chief Minister Y S Jagan Mohan Reddy on Thursday held an open interactive session with industry representatives to hear their views on industrial environment and provide feed back on his government's initiatives on the eve of the completion of one year in government.

The chief minister said he would want to see the businesses happy and comfortable as they provide more jobs as and when they are able to run their operations smoothly and successfully.

During the interaction, Kia Motors India's chief executive officer Kookhyun Shim said that his company would invest $54 million in the plant over and above what was already committed. Kia Motors had rolled out Made in India SUV models last year following the commencement of manufacturing operations at its first plant in India located in the district of Anantapur.

The company had announced $2 billion investment, including a vendor base in the state at the time of signing an MoU with the AP government in April 2017. The company readied its plant in less than two years time while the debut launch of multi-variant Kea Seltos SUV last year found instant success beating the general decline in car sales in the segment.

Shim said that the additional investment would go towards SUV manufacturing operations, sounding an optimistic note at a time of gloom surrounding the car industry among other sectors due to coronavirus pandemic.The Korean auto maker restarted its operations two weeks ago after the state government issued relaxations from the lockdown restrictions imposed earlier.

Meanwhile, the homegrown Aurobindo Pharma Limited, which has a large manufacturing base in the state, also said it would be making substantial investments in 2-3 years time in the state. Speaking at the session, Aurobindo Pharma director M Madan Mohan Reddy said the company was planning to invest close to Rs 2,000 crore in the next 2-3 years to ramp up capacities in the state. Aurobindo has 6 manufacturing facilities in AP and it has invested around Rs 3,000 crore in the state so far, according to Reddy.

Meanwhile, the chief minister said that his government would strive to further build on the inherent strengths of the state to make it an attractive destination for the industry, including skill development initiatives to produce skilled manpower in order to make cities like Vizag compete with Tier-1 cities like Hyderabad, Bengaluru and Chennai in the software sector among others.