Financial Daily from THE HINDU group of publications
Monday, Mar 13, 2006
Industry & Economy - Foreign Trade
Finland, India to sign air services pact
Kone Elevator India is investing Rs 24 crore to expand its existing manufacturing facilities by 25,000 sq ft and set up a training centre.
Mr A. Sankarakrishnan (extreme right), Managing Director, Kone Elevators India Pvt Ltd, with the Prime Minister of Finland, Mr Matti Vanhanen, at the company's facility in Chennai on Sunday. Also seen: (from left) Mr Asko Numminen, Finland Ambassador to India, and Ms Susanna Houvinen, Minister of Transport and Communication, Finland. - S.R. Raghunathan
Chennai , March 12
Finland and India will be soon signing an air services bilateral agreement that will facilitate a direct connection between New Delhi and Helsinki, the Prime Minister of Finland, Mr Matti Vanhanen said on Sunday.
This flight would take six-and-a-half hours and would be the shortest route to Europe from India, he added. This service is likely to start next autumn.
Mr Vanhanen was speaking to newspersons after the inauguration of a factory and training centre of Kone Elevator India Pvt Ltd at Ayanambakkam, near Chennai.
Besides the bilateral agreement, the two countries would discuss areas of co-operation in which both the countries have inherent strengths. Finland has strengths in mobile technology, paper and pulp, energy, welfare, and health sectors while India's strength lies in engineering, textile, tourism, and software, he said.
Mr Vanhanen also said that Finnish companies are increasingly interested in the Asian market. Even a small acceleration of growth in countries such as India and China triggers additional demand. This is especially so in a trade like elevators and escalators.
According to him, it is in the interest of Finland that Finnish companies do well in global competition. Only companies that are strong in the markets of rapid growth can sustain their business in Finland, he added.
Mr Vanhanen said that in most cases it requires investment in new production capacity close to the growth markets. On Saturday, Mr Vanhanen inaugurated a Nokia factory in Chennai.
Kone Elevator India (KEI) a 100 per cent subsidiary of Kone Corporation, is investing Rs 24 crore to expand its existing manufacturing facilities by 25,000 sq ft and set up a training centre. The training centre will have four shafts for testing the product as well as for training.
Kone Corporation has also established a global software centre and a global engineering centre to support their international operations, Mr A. Sankarakrishnan, Managing Director of KEI, said.
Kone Corporation is a three-billion-euro company with its class B shares listed on the Helsinki Stock Exchange.
KEI operations started as a joint venture between Kone Corporation and Best & Crompton Engineering Ltd in 1983. Mr Sankarakrishnan said that in 1992 Kone Corporation acquired all the shares of Best & Crompton and KEI became a fully owned subsidiary of the Finnish company. In 2004, KEI acquired the elevator business of Bharat Bijilee to expand its market share.
The market for elevators and escalators has been growing rapidly in the past 2-3 years, Mr Sankarakrishnan said. The demand has mainly being fuelled by the IT, which in turn has triggered off growth in commercial, residential, and rental real estate development.
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