Race hots up for Peugeot's car plant, Gujarat too in fray

After Tamil Nadu, the top company officials meet chief minister Narendra Modi.

The race for France's leading car maker PSA Peugeot Citroen's manufacturing plant in India has heated up with the company having met the Gujarat Chief Minister Narendra Modi on Thursday.

According to an official statement by the Gujarat government, a delegation of Peugeot Group of Companies led by Gregoire Olivier, chief executive officer, of Asian Operations for PSA Peugeot Citroen, China, Frederic Fabre, managing director of PSA Peugeot Citroen India project, and Jitesh Gadhia, senior managing director, The Blackstone Group, among others met Chief Minister Narendra Modi and expressed their desire to set up a manufacturing plant.

The statement quoted Peugeot officials as saying that Gujarat is rapidly emerging as a hub for automobile industry. The company is impressed with the fast-paced development of Gujarat and is in talk with the state government regarding a suitable place for the plant. "The company is in talks with three states for setting up its first plant in India and that Gujarat is one of the favourite places of the company. However, the company has not taken any decision yet and the Board of Directors will finalise the matter," the statement quoted Olivier as saying.

PSA Peugeot's visit to Gujarat was the company's second such attempt, after having me the Tamil Nadu government on Wednesday. The French car maker is reported to have submitted a proposal to the Tamil Nadu government for setting up an integrated automobile project with an investment of Rs 4,000 crore.

According to Gadhia, whose The Blackstone Group is one of the financial advisors to PSA Peugeot, the car maker is in "active discussions with three states including Gujarat". Reportedly, the company is learnt to be in talks with the Andhra Pradesh government as well.

"The company is actively considering Gujarat as one of the states. Though it was a private meeting with the Chief Minister, the same was open and constructive. Gujarat is an impressive state," said Gadhia. When asked about the reports on the company's plans for setting up a plant in Tamil Nadu, Gadhia said, "No decisions have been taken so far. We are still in talks with the governments. A final decision will be taken in the next few months."

Gadhia, however, refused to divulge details on the manufacturing capacity that PSA Peugeot is looking for. Apparently, the second largest automaker based in Europe has been in the process of setting up an integrated automobile project in the country for which the company is scouting land in states like Tamil Nadu, Gujarat and Andhra Pradesh.

PSA Peugeot's visit to Gujarat comes hardly a month after Maruti Suzuki India Ltd's (MSIL) Chairman R C Bhargava and managing director Shinzo Nakanishi met Modi and had expressed intent to set up a plant in Gujarat on a 500-acre plot, with a capacity to produce a million cars per annum.

Saurabh Patel, minister of state for industries, MM Shrivastava, additional chief secretary to finance, K Kailasnathan, principal secretary to CM, AK Sharma, Secretary and Arvind Agrawal, MD, GIDC were present on the occasion, among others.