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Chennai, July 7 IFC, Washington, is likely to lend $20 million to TVS Motor Company’s Indonesian subsidiary, PT TVS Motor Company, Indonesia.

IFC’s Web site notes that the proposed project of the subsidiary consists of establishment and start-up of operations of a greenfield, two-wheeler manufacturing plant in Karawang, about 55 km East of Jakarta, Indonesia.

The plant will have an initial manufacturing capacity of 3-lakh vehicles per annum.

The project will cater mainly to the Indonesian market, which is the world’s third largest after China and India with a demand of 4.5 million units in 2006.

“Although the current two-wheeler market in Indonesia is highly competitive, low per capita ownership in the country (of only 80 motorcycles per 1,000 people, in 2005) compared with its neighbours (of 545 in Taiwan, 286 in Thailand, 258 in Malaysia, and 125 in Vietnam) reinforces a strong market growth potential for the future,” the Web site notes.

In addition to its large domestic market, Indonesia is also a strategic export base given low labour cost, and availability of competitive sourcing of components, it says.

More Stories on : Overseas Borrowings | Two/Three Wheelers | Financial Institutions

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