Tata Motors may soon set up a car manufacturing unit in Egypt, North Africa. The car major is said to have held talks with an eight-member high-level delegation from Egypt, which is here on an investment and tourism promotion drive. The company has also lined up investments in the petroleum business.
"Besides the car business, the Tata company has also evinced interest at making investments in the area of petroleum and gas in Egypt," said Nagui B Erian, member of the Egyptian delegation and head of the Fairs and Congresses Committee.
"A lot of Indian IT companies are bullish on investing in Egypt," added Erian. He was in Mumbai as part of the Egyptian Tourist Authority delegation, which was in the city to announce its India plans.
Egypt is a big transport market for Tata Motors. In March 2006, after a comprehensive market analysis, Tata Motors decided to re-enter Egypt.
Taj Hotels, Palaces and Resort, another Tata enterprise, is also looking at buying land in Cairo, Egypt to set up a five-star luxury hotel, with a capacity between 250 and 300 rooms and a likely investment of $55 million.
"The Taj officials met us in Delhi and asked us if there is land available in Cairo for them to build a five-star luxury hotel. However, we have not discussed the investment part of it," said Erian.
Egypt currently has 176,000 hotels and hopes to increase the number to 240,000 by 2011.
Egypt is gaining popularity as an investment destination due to its strategic geographic location, which makes it a regional hub linking the Mediterranean, Europe, Asia and the Arab world. It is a gateway to Africa besides being a lucrative business provider to shipping lines and companies in optical fibre cables.
The immediate business opportunities in Egypt are said to be in the public data and internet services, wireless local loop networks, the mobile network and offshore development.
India is currently the second largest Asian investor in Egypt and the 12th overall.
The country is hoping to be among the top 10 foreign investors in the future. Over 40 Indian entities have currently invested some $450 million in the African nation.
GAIL, Tata Motors, Ranbaxy, Oberoi, NIIT, HDFC, Dabur, Unit Trust of India, and Kirloskar are among the major Indian investors. Following changes in Egypt's investment climate, the country saw its foreign inflows increase to $6.1 billion in 2005-06 from a meagre $407 million in 2003-04 -- a huge jump of 300 per cent.