India’s Mahindra starts vehicle assembly at Sri Lanka JV plant
ECONOMYNEXT – Vehicle assembly at a joint venture plant by India’s Mahindra and Sri Lanka’s Ideal Motors was flagged off by by Prime Minister Ranil Wickremesinghe and High Commissioner Taranjit Singh Sandhu.
Mahindra Ideal Lanka (Pvt.) Ltd will assemble vehicles for the domestic market.
Despite having a free trade deal with India, completed vehicles brought form India are taxed at over 200 percent in some cases and giving an advantage when components are imported in complelely knocked down form (CKD) and assembled.
Wickremesinghe said seats and some other items were made in Sri Lanka and there were opportunities for Sri Lankan firms to export components.
The plant in Klutara has a capacity of 5,000 units a year, Mahindra said..
Ideal Motors has a 65 percent stake in the plant and Mahindra 35 percent.
The plant will initially produce KUV100 mini SUVs, but the production line could be re-jigged to assemble other models as well Ideal Motors Deputy Chairman Aravida de Silva had said. (Colombo/Aug18/2019)