Japanese tyre major Yokohama to set up its manufacturing plant in Bahdurgarh

In a bid to increase its passenger tyre market share from the existing 2 percent to 5 percent, Yokohama India Private Limited is going to set up its manufacturing plant in Bahdurgarh Industrial Estate. It is expected to start its operations by mid 2014. The Rs 965 crore-unit would generate job opportunities for around 900 people.

"Around 25 acres was allotted for the unit in 2008,"said Yokohama spokesperson. The Indian tyre market has an annual turnover of around Rs 30,000 crore out of which around one quarter (Rs 7,500 crore) comes from the passenger tyre segment. The Japanese tyre major is planning to grow from Rs 150 crore to Rs 375 crore-company through this unit.

FINANCE AND INVESTMENT

The spokesperson said, "We are going to invest 4.4 billion Yen (around Rs 300 crore) in Phase I. And the company would manufacture only passenger car tyres with an annual production capacity of 7 lakh tyres in Phase I."

On net investment expected in final phase, Gulshan Kumar, DGM of HSIIDC, Industrial Estate, Bahadurgarh said, "The Yokohama project is an ambitious project both for HSIIDC and Bahadurgarh's economy as it is expected to attract around Rs 965 crore in the region."

INDIRECT BENEFITS

The Yokohama spokesperson went on to add, "The unit is going to help logistic, hospitality, employment generation and security services, etc as indirect beneficiaries of our unit." So, the Yokohama unit is expected to create business and job opportunities for the above mentioned industries in the region as well.

Jitender Singh, AGM of HSIIDC, Bahadurgarh said, "If we count both direct and indirect opportunities, the net job opportunities expected from this unit is around 900, which is huge for a city like Bahdurgarh."

REASON FOR DELAY

Although the land for unit was allotted in 2008, "the construction was postponed due to global recession and the tumbler in Japan," the Yokohama spokesperson said.

However, HSIIDC rules state that the allottees have to start production within four years of the date of allotment; otherwise its plot will be reclaimed. How the Yokohama managed to keep their land intact?

Jitender Singh of HSIIDC said, "It's not that we resume the plot directly when an allottee fails to start operation within our given time frame. There are provisions in which the allottee can ask for the paid extension citing valid reason(s) from the HSIIDC."

Singh explained,"An allottee needs to pay Rs 75 per square metre for one year paid extension while for second year extension the price is Rs 150 per square metre," and added, "If an allottee sought for further extension with genuine reason(s), there are provisions for that as well." He said that in case of Yokohama India, the firm has taken one year paid extension.

When asked about the above mentioned explanation from the HSIIDC regarding plot resumption, the Yokohama India spokesperson said, "Yes. One year extension was given by HSIIDC to entire Bahadurgarh Industrial Estate; however, further extension was obtained after payment of fees as per the HSIIDC policy."

WHY BAHADURGARH

The spokesperson added that there were so many places to set their manufacturing unit in India but they choose Bahadurgarh because of its good access to Delhi and Indira Gandhi International Airport, possibility of future metro link and good connectivity through the expressways.

However, on the recently mooted international air cargo in Rohtak making any difference to the expected business of Yokohama tyres, the spokesperson said, "We don't think so, because most of our business is by sea cargo."