Berger Paints India Ltd and the government of Stavropol Region, Russian Federation, have inked a MoU for setting up an industrial coatings plant in the Russian region.
The initial capacity of the plant could be 3,000 tonnes a year, which may be scaled up to almost 50,000 tonnes a year, Kuldip Sigh Dhingra, chairman, Berger Paints India, said.
According to initial estimates, the total investment for establishing the plant is around $5 million.
Berger would also conduct a feasibility study to be completed by this year for setting up the plant.
“The land cost for us was not much as the Government of the Russian region has given us a nominal lease till 2030,” K.S. Dhingra said.
Stavrapol is an industrially developed area in the Southwestern part of Russia with an automobile manufacturing facility, apart from other industries.
It has allocated 6 hectares to Berger for the facility.
“Russia is a growing market and we plan to cater to the demand of the industry in Stavropol and rest of the country based on the results of the feasibility study,” K.S. Dhingra said. “This is a step towards development of bilateral cooperation and we look forward to a successful collaboration,” he added.
On why the company is setting up manufacturing facilities abroad at a time when the Prime Minister Narendra Modi has called for ‘Make In India’, Dhingra said: “Post setting up our facility in Hindupur, Andhra Pradesh, we have taken care of the requirement for the next five years. We will invest in India as much as is needed.” Also exporting from India to other countries would mean logistical issues as paint is bulky, he added.
The company has plants in Bangladesh, Nepal, Poland.
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