India-Japan relations: Suzuki announces investment of Rs 10,445 Cr in Gujarat to manufacture Evs, batteries; Countries must work together for sustainable economic growth

Japanese automaker Suzuki Motor Corporation (SMC) has announced the signing of a Memorandum of Understanding (MoU) with the Government of Gujarat for the domestic manufacture of Battery Electric Vehicles (BEVs) and Battery BEVs.

He said he would invest 150 billion yen (about Rs 10,445 crore) by 2026.

The MoU was signed “on March 19, 2022, during the India-Japan Economic Forum held in New Delhi, India, in the presence of Japanese Prime Minister Fumio Kishida and Indian Prime Minister Narendra Modi”, Suzuki Motor Corporation said in a statement. declaration.

Speaking at the India-Japan Economic Forum, Representative Director and Chairman of Suzuki Motor Corporation (SMC), Toshihiro Suzuki, said, “Suzuki’s future mission is to achieve carbon neutrality with small cars. We will continue to actively invest in India to realize self-reliant India (Atma-nirbhar Bharat). »

As per the MoU, Suzuki Motor Gujarat Pvt Ltd (SMG) will finance Rs 7,300 crore for setting up a BEV battery factory on a plot of land adjoining the existing SMG factory by 2026.

Additionally, SMC will inject another tranche of Rs 3,100 crore to increase production capacity for BEV manufacturing by 2025, according to the release.

The current scenario:

The Suzuki Group currently holds an aggregate production capacity of approximately 22 lakh units per year at two facilities of its main subsidiary – Maruti Suzuki India (MSI) in Haryana and SMG’s plant in Gujarat for the manufacture of motor vehicles at conventional internal combustion.

MSI’s production capacity at the factories in Gurgaon and Manesar in Haryana stands at 15 lakh units per year.

SMG in Gujarat has an additional installed production capacity of 7.5 lakh units per year.

Maruti Suzuki Toyotsu India Pvt Ltd (MSTI)

In the statement, SMC added that Maruti Suzuki Toyotsu India Pvt Ltd (MSTI) will invest Rs 45 crore for the construction of a vehicle recycling plant by 2025.

Signatories to a Memorandum of Understanding with the State of Gujarat The description Investment Planned year
Suzuki Motor Gujarat Private Limited (SMG) Increased production capacity for BEV manufacturing Rs 3,100 crores 2025
Construction of a factory for BEV batteries (site next to SMG) Rs 7,300 crores 2026
Maruti Suzuki Toyotsu India Private Limited (MSTI) Construction of a vehicle recycling plant Rs 45 billion 2025

In November 2022, MSTI, the joint venture of Maruti Suzuki and Toyota Tsusho Group, started operations for vehicle dismantling and recycling units in Noida, Uttar Pradesh. In November 2019, the two companies had announced the creation of the vehicle scrapping and recycling unit.

The 10,993 square meter facility can scrap and recycle more than 24,000 ELVs (end-of-life vehicles) per year.

The Indian branch of Maruti Suzuki Corporation aims to make a foray into the electric vehicle segment by 2025. The company, however, has an inhibition that selling affordable electric vehicles at current going prices, that too on a large scale, would be a hard-to-crack nut.

Maruti Suzuki in 2019 had tested an electric vehicle based on its WagonR model with plans to launch them in 2020 but did not proceed with a commercial launch for personal use due to lack of infrastructure and government support.

Clean Energy Partnership (CEP)

India and Japan also inaugurated the Clean Energy Partnership (CEP) to work together for sustainable economic growth, combat climate change and ensure energy security.

This initiative was announced at the 14th Annual India-Japan Summit.

For the uninitiated, Japanese Prime Minister Fumio Kishida was on a two-day visit to India (March 19-20) for a summit with Indian Prime Minister Narendra Modi.

“The partnership will drive clean growth by stimulating job creation, innovation and investment. It will also demonstrate to the world that India and Japan are at the forefront of achieving the ambitious climate and sustainable development goals,” a Ministry of External Affairs (MEA) statement on the collaboration reads.

“Cooperation under this partnership will build on the work already done by both parties under the ‘India-Japan Energy Dialogue’ established in 2007 and will greatly expand the areas of collaboration for mutual benefit,” adds the communicated.

“They (the Prime Ministers of India and Japan) welcomed the launch of the India-Japan Clean Energy Partnership (CEP) for cooperation aimed at achieving sustainable economic growth, tackling climate change and ensuring energy security. , in areas such as electric vehicles (EV), storage systems including batteries, electric vehicle charging infrastructure (EVCI), solar, clean energy including hydrogen/green ammonia, wind energy, exchange of views on respective energy transition, energy efficiency, CCUS (carbon dioxide capture, utilization and storage) and carbon recycling,” said a joint press release from India and Japan.