Escorts Kubota Cancels Plan For New Unit In Rajasthan's Ghiloth

Escorts Kubota Ltd. has retracted its plans to establish a new manufacturing facility at Ghiloth in Rajasthan. The decision was made due to the inability to fulfill all the essential criteria for a large-scale project. Despite this setback, the company, which had planned an investment of up to Rs 4,500 crore over the next three to four years for the new plant, is still considering alternative locations in various states, including Rajasthan.

Escorts Kubota had submitted an Expression of Interest to Rajasthan State Industrial Development and Investment Corp. for the proposed acquisition of land in Ghiloth, Rajasthan, subject to requisite approvals and clearances, for setting up an integrated greenfield manufacturing facility, for expanding the existing capacities, the an exchange filing said.

"...Based on the detailed assessment of the location, the company has reached a conclusion that the location does not meet all the key requirements for a large-scale project being planned and accordingly the company has withdrawn the aforesaid EOI," it added.

One of the key factors for the company withdrawing the EOI was the state government's inability to commit to providing adequate industrial water for the project. However, Escorts Kubota in its filing said it is "committed to setting up an integrated greenfield manufacturing facility, in line with its Mid Term Business Plan and continues to explore the alternate options with other states, including Rajasthan".

Through a new manufacturing plant, Escorts Kubota plans to double its domestic tractor production capacity to 3.4 lakh units annually, while also setting up new engine and construction equipment lines in phases.

At present, the company has a total annual tractor production capacity of 1.7 lakh units. The main plant is located at Faridabad. Its engine production capacity is 1.5 lakh units annually with Kubota engines currently being imported.

(With inputs from PTI.)