UK'S HINDUJA TO INVEST $3.5 BILLION IN INDIA

UK'S HINDUJA TO INVEST $3.5 BILLION IN INDIA

Britain's giant Hinduja trade and finance group said it has chalked out a 110 billion-rupee ($3.5 billion) investment plan for India.

Group president Gopichand Hinduja told Reuters he has plans to invest in India's core business sectors like power, transport, refineries, telecommunications, chemicals and fertilizers and financial services.Mr. Hinduja, who met Prime Minister P.V. Narasimha Rao during his current trip to India, said he believed that the country's economic reform program would be successful.

"India has not made the mistake of going fast with reforms like other countries, and investors are confident of it," he said.

He said his group, with annual revenues of $12 billion, was moving ahead with its plans in the transport sector, and that Mr. Rao had asked him to help develop India's battered road system.

A non-resident Indian, Mr. Hinduja heads a group that has wide interests in banking, international trade and finance, and figures in Fortune magazine's list of the world's richest.

Ashok Leyland, the group's flagship company in India, has recently started a 10-billion-rupee ($322 million) expansion program to manufacture new generation trucks using technology from Italy's Iveco.

Ashok Leyland is listed on the Indian bourses.

But it is the group's power and refinery project that should push it into the big leagues of Indian industry.

Mr. Hinduja has planned a more than 30-billion-rupee ($1 billion), 1,000 megawatt coal-fired power project in the southern Indian state of Andhra Pradesh, in conjunction with Britain's National Power Co.

The power project has taken shape, Mr. Hinduja said, but he is facing trouble getting government clearance for the refinery proposal.

"We are experiencing problems because the (government) ministry is still not for full private sector. They want us to go in the joint sector," he said, referring to the now frequent practice of joining hands with a state- owned company.

The refinery project would cost the Hinduja group nearly 40 billion rupees ($1.3 billion), he said, without giving details.

The group has expanded considerably since it entered India in 1989 by acquiring Ashok Leyland, the country's second-biggest truck maker.

It is looking at entering the financial sector with its new company, Hinduja Finance, with help from another company, Ashok Leyland Financial Services.

The Hinduja group also has plans to start a commercial bank and enter the insurance business, once it receives government permission.

India recently allowed the creation of private banks for the first time since the banking industry was nationalized in 1969, under sweeping economic reforms launched more than two years ago.