On Wednesday, Reuters had reported that KIA motors was planning to shift its plant to Tamil Nadu as it was facing problems in Andhra.

No discussions with KIA motors Tamil Nadu govt official tells Andhra counterpart
news Controversy Thursday, February 06, 2020 - 18:04

A news report claiming that KIA motors was planning to shift its 1 billion dollar plant from Andhra’s Anantapur to Tamil Nadu has kicked up a controversy in Andhra Pradesh. While both the Andhra Pradesh and Tamil Nadu governments have already denied the report by Reuters, Rajat Bhargava, the Special Chief Secretary for Industries, Investments and Commerce in Andhra Pradesh, has now stated that the Tamil Nadu government has directly communicated to them that there are indeed no such plans with KIA motors. 

“The Government of Andhra Pradesh enjoys a cordial relationship with our neighbouring state Tamil Nadu. The Principal Secretary to Government, Industries Department of Tamil Nadu has conveyed that they are not in talks with KIA Motors and that there were no discussions between the two parties in this regard.” Rajat Bhargava said in a statement to the media. He also added that KIA Motors has denied the contents of the Reuters report and has expressed satisfaction over their operations in Andhra Pradesh. 

Reuters had reported that KIA Motors was facing problems in Andhra Pradesh, and that the automobile firm was in “preliminary negotiations” with the Tamil Nadu government to shift out its plant from the state. The report cited a senior government official and two other sources stating that more clarity is expected after a secretary-level meeting next week.

Calling the Reuters report ‘completely baseless’, Rajat Bhargava stated that Andhra’s partnership with KIA motors is going strong, with KIA motors planning to increase their production capacity from 2 lakh units to 3 lakh units per annum by the end of 2020. 

YSRCP national secretary V Vijayasai Reddy also dismissed the report about the fallout between the government and KIA Motors, and claimed that both Jagan and KIA share an “excellent” relationship. Andhra Pradesh Finance Minister Buggana Rajendranath has also denied the news, calling the report ‘irresponsible and mischievous’.

KIA motors’ Andhra plant was launched in 2019 during the previous Chandrababu Naidu-led TDP government. The company invested Rs 12,900 crore in the manufacturing unit, which is located in Penukonda, Anantapur. Though the unit has been rolling out cars since August, Chief Minister Jagan Mohan Reddy was invited for an inauguration event in December 2019.  

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