Ford announces new $1 billion plant in India

NEW DELHI, July 28, 2011 (AFP) – US auto giant Ford said Thursday it would invest $1 billion to build a second vehicle assembly and engine plant in India as it ramps up production to exploit the country’s burgeoning car market. India has become a battleground for global car manufacturers such as Ford, GM and Toyota which hope to offset sluggish domestic sales by steering towards India and China, seeing huge potential in their billion-plus populations.

“Ford has very aggressive expansion plans in India and in Asia Pacific and Africa,” and this investment in the western state of Gujarat “will be important in realising our growth strategy,” top Ford executive Joe Hinrichs said.

The new factory in Sanand, 40 kilometres (25 miles) from Gujarat state’s main city of Ahmedabad, will employ 5,000 workers and be Ford’s second in India after its vehicle and assembly plant in the southern port city of Chennai.

Gujarat has emerged as an investment magnet for car and other manufacturers with its business-friendly policies, despite controversy surrounding its Hindu nationalist chief minister, Narendra Modi, who is accused of turning a blind eye to deadly anti-Muslim riots in 2002 — an allegation he rejects.

Modi said in a s