NEW DELHI: The Indian government has cleared the setting up of joint ventures between Maruti Udyog and Ford Motors and Tata Industries and I B M., involving a total investment of over RS 1070 The two proposals for manufacture of aluminum radiators and personal computers in conjunction with the U.S firms were cleared by the newly constituted foreign investment promotion board. Under the first proposal, as 22 million joint venture between Maruti Udyog and Ford Motor Company of U.S aluminum radiators will be manufactured for Maruti cars and export purposes. An official equity spokesman told newsmen here Wednesday the project will have a 133 million; Maruti Udyog will invest RS 51.9 million or 39 per cent from its own resources. There will be no budgetary support from the government. Ford Motors would invest RS 74.5 million of 56 per cent in the venture. Sumitomo Corporation of Japan would invest R.S 6, 600,000 Lakhs or five per cent and the dividends to Ford Motor Company and Sumitomo Corporation would be paid out of earning from expense.
The spokesman said the government has also cleared a proposal for a joint venture between Tata Industries Limited and IBM would trade corporation for manufacture of Hi-End or Upper End personal computers.
The total capital investment in the venture would be about RS 850 million and Tata’s and IBM would hold equal share of 50 per cent each of equity capital.
The spokesman said while RS 520 million would be by way of equity, the balance would be funded through short term loans. RS 260 million of equity will be by IBM and would exceed the requirement of foreign exchange for import of capital equipment.
Article extracted from this publication >> October 4, 1991
