Special Correspondent

JAIPUR: The promoters of Honda Motorcycle & Scooter India (HMSI) have shown interest in setting up a second unit in the country in Rajasthan's Bhiwadi area.

The proposal is to make an initial investment of Rs.500 crore within a period of five years and take it up to Rs.1,100 crore later. The production target of two-wheelers in the first phase will be six lakh vehicles per annum which will go up to 12 lakhs eventually.

Approval granted

The Rajasthan Cabinet has already granted approval to the project offering a customised package including 60 acres of land at subsidised rates at Khushakheda near Bhiwadi in Alwar district, 50 per cent rebate in stamp duty and power tariff, besides cash subsidy in VAT and special Central Sales Tax rates.

HMSI is a subsidiary of Honda Motor Company, Japan, which already has a two-wheelers manufacturing plant at Manesar in Haryana with capacity to manufacture 1.55 million vehicles per annum. The company exports its scooters and motorcycles to 35 countries including most of the European Union nations.

“The package is keeping in view the economic and financial environment the project would create,” said a senior official of the Rajasthan Government. “In addition, the project will have a huge spin-off effect in terms of large number of units being set up to service the main plant.”

For establishing the above project, approval from Honda Company has been taken to sign the agreement letter. The “bhoomi poojan” of the project and its construction is likely to begin this month itself and production is expected to begin in 15 months time. Honda Company has also decided to set up a Technical School in the area to provide technical training and employment to artisans.