Leading domestic air-conditioner maker Voltas plans to set up a compressor manufacturing unit in partnership with an international partner and will invest around Rs 500 crore, said a top company official.
The Tata Group firm is planning to invest in a joint venture company, with an international partner, which requires PN3 (Press Note 3) approval, said its Managing Director and CEO Pradeep Bakshi.
Bakshi did not share any details of its international partner, but said it is one of the largest compressor manufacturers globally.
"For that, we have already filed for PN3 approval and we are waiting for it. Once it is done, we will be setting up the plant," Bakshi told PTI, on the sidelines of an investors roundtable on production-linked incentive (PLI) schemes held on white goods.
When asked about the investment, he said: "We plan to invest a minimum of Rs 350 crore on compressor manufacturing and another Rs 150 to 200 crore for air-conditioning."
"We have committed an additional investment of around Rs 450 crore to 500 crore to the government on the basis of the approval of PN3," he added.
The company is yet to decide on a place for its compressor manufacturing plant as it is still waiting for the finalisation of the PN3 application. "Once PN3 is approved, we will decide on other things," Bakshi added.
Under that press note, the government had made its prior approval mandatory for foreign investments from countries that share a land border with India, to curb opportunistic takeovers of domestic firms following the COVID-19 pandemic.
Countries that share land borders with India are China, Bangladesh, Pakistan, Bhutan, Nepal, Myanmar and Afghanistan. As per that decision, FDI proposals from these countries need government approval for investments in India in any sector.
The government has already approved the proposals of Voltas for manufacturing of Cross Flow Fan (CFF), Heat Exchangers and Plastic Moulding components under the PLI scheme.
Earlier this month, the government had announced the selection of 26 proposals with a committed investment of Rs 3,898 crore for the air conditioner sector.
Under the PLI, the government has approved the Rs 538.70 crore proposal from Daikin Industries, the world's leading air-conditioning company to manufacture compressors, heat exchangers, sheet metal components and plastic moulding components.