India’s largest carmaker Maruti Suzuki India will invest INR40000M (US$721M) to set up new manufacturing facility in Gujarat by 2015-16.

The Company said the new plant at Mehsana will be opened in a phased manner with overall capacity of 250000 units in the first phase. The Company said that it signed the State Support Agreement with the Government of Gujarat for purchase of land near Mehsana to set-up an all new manufacturing facility. The Gujarat Government has allocated around 700 acres for the proposed plant.

Based on market demand, the manufacturing facility near Mehsana will be added to the Company’s existing plants at Gurgaon and Manesar in the state of Haryana NW India. When the Gujarat plant is commissioned, the total production capacity of the Company will be 2 million units.