The $40 billion Ssangyong business group is investing $1 billion in India over the next five years to get its major businesses like financial services, power and software into the country.
The group has earmarked ambitious plans for India and plans to use the country as an export base. To begin with, the South Korean conglomerate has already set up its construction company here.
Besides, it is in negotiations with several Indian companies for setting up joint ventures in the software, financial services and power sectors, Ssangyong Corporation general manager Sung-Hwan Kim said here yesterday.
However, Ssangyong does not have plans to get its core business automobiles, to India. The group, he said, is setting up a joint venture with the Madras-based Welbrine Chemicals for developing salt fields in Gujarat.
The Indian company holds the majority stake of 60 per cent in the venture with Ssangyong controlling the rest.
The salt produced in these fields would be processed and mainly exported to Korea. The unit, set up over 6000 acres, has an installed capacity of 6 lakh tonnes and production will commence by the year-end, Kim added.
The Ssangyong group is active in nine major business areas automobile and machinery manufacturing, energy processing, materials production, information & telecommunication, financial services, engineering & construction, trade & transportation, leisure and paper.
Besides, the group is also in talks with several Indian companies to set up a joint venture for undertaking power projects here.
We are interested only in the small and medium sized projects of 25 mw, 50 mw and 100 mw capacity. The group is not going for the big-sized ones, he said adding that Ssangyong is presently negotiating for a 50 mw power project in Gujarat.
Regarding the groups automobile business, Kim said, We tried to get our automobiles to India and had even talked with several Indian companies in this regard. However, the talks could not fructify.
Moreover, in India, there is a large potential for small and medium cars whereas Ssangyong is known for luxury vehicles which has only a niche market here. This had been one of the hurdles for the company.
The Indian market for big cars is about 60,000 units a year and the group, he said, was thinking of much larger volumes. In the short term, it will not be possible for us get the cars here.
The software arm of the group Ssangyong Information & Communications Corporation, is currently negotiating with Usha India to set up a joint venture in the software industry. It would develop information technology software for the Indian and foreign markets. Moreover, they are also scouting for partners to set up industrial parks in the country, Kim stated.
The $1.5 billion construction arm of the group Ssangyong Engineering & Construction Company Ltd (Seccl), has bid for a 50 km national highway construction project in Madhya Pradesh. We are into talks with the government for this $50 million project, Seccl general manager Shin Ho said.
Seccl, he said, will be undertaking all types of construction works in the country from buildings to infrastructure and even plant construction. However, initially, we will be paying attention only to infrastructure projects which are aided by international finance companies. We are also considering taking up projects on the build-operate-transfer (BOT) basis, he added.
Ho said the present Indian laws do not allow foreigners to develop property here, but we hope that with time, the government stand will change.
Moreover, the Indian office of Seccl will also undertake construction projects in neighbouring countries like Pakistan, Nepal, Bangladesh and Sri Lanka, Ho added.
Kim said Ssangyong Investment & Securities Company Ltd is negotiating with an Indian party to setting up a non-banking finance company in India.
The joint venture company would indulge in securities trading, acquisitions and brokerage activities. According to Kim, the group is also exploring the feasibility to set up oil refineries and base oil manufacturing units in India.
Moreover, it is also planning to enter the electronics and steel sector here.
We are all set to be one of the biggest industrial houses here. It is just a matter of time now, he said.
