Calcutta, Jan. 17: Ural India Limited has started commercial production of trucks and plans to make engine parts and axles at its Haldia plant from this year.

Ural India is a joint venture between Calcutta-based Motijug Group, West Bengal Industrial Development Corporation (WBIDC) and Uralaz of Russia to manufacture heavy duty trucks.

The project will entail an investment of Rs 550 crore, of which Rs 100 crore has been invested in the first phase.

“We are currently importing the completely knocked down (CKD) version from Russia with a localisation rate of 30 per cent. This would increase to around 50 per cent by next year when we start manufacturing components at our Haldia plant. The company plans to increase the localisation level to 80 per cent in five years,” said Anirudh Kanoi, director, Ural India.

The company started its commercial production in May 2006, but it took six to eight months to get the approval from the Automotive Research Association of India (ARAI) for the vehicle.

The company has already sold five heavy duty and capacity trucks to the mining industry. It has set a target to sell 3,000 vehicles in 2007-08. The capacity would be ramped up to 40,000 vehicles in five years.

Ural India has also received enquiries for these trucks from neighbouring countries of Nepal and Bangladesh. The company already has orders for 50 to 60 vehicles.

Of the target 3,000, Ural expects to sell 1,500 vehicles to mining and construction companies and the rest to the armed forces. These trucks, with prices starting from Rs 30 lakh when manufactured and assembled in Haldia, are 40 per cent cheaper than the imports from Russia. The Haldia plant requires 500 acres, of which 100 acres has been provided by WBIDC. The Haldia Development Authority is likely to hand over another 100 acres next month.

The Bengal government holds an 11 per cent stake in the joint venture, while the Indian and Russian partners hold 44.5 per cent each.

Motijug Group has also formed a 50:50 joint venture with the Slovenia-based Gorica Industries to manufacture the rear body of all kinds of trucks.

“We have taken over a sick unit and given 20 acres for this manufacturing project, which would entail an investment of Rs 100 crore. This unit will start operations in the second quarter of 2007-08 with a capacity of 10,000 units per year,” Kanoi said.