Chinese truck manufacturer Beiqi Foton Motor plans to set up production in India, according to local reports.

Foton - part of Daimler - is aiming for a yearly production rate of 100,000 vehicles by 2011.

Foton had no comment but a Daimler source in China indicated both parties would examine overseas business propositions, although China would remain the German automaker's main objective.

Analysts are forecasting growth in the Indian commercial vehicles sector of 15% this year, powering ahead of national economic improvement of 8.5%.

Truck sales in India - the world's fourth-largest commercial vehicle market - totalled 531,000 in 2009/10 - up 38%.

Analysts said the CV market is predicted to grow by 15% this year, in contrast to nationwide growth of 8.5%.

"It's a good move as commercial vehicles have great growth potential in India, especially light trucks which Foton is good at," said CSM Worldwide analyst Huang Zherui.

"But it also faces challenges in a market which it doesn't have a lot of experience. A local partner could be a big help for Foton."

Beiqi Foton expects to accelerate its global expansion by building five overseas plants, each with annual production capacity of 100,000 units, in five South Asian countries.

Sales of Beiqi Foton totalled 600,000 vehicles during 2009.

By 2020, the firm is aiming for annual sales of 4m vehicles.

General Motors announced recently it would launch commercial vehicles made by China's SAIC in India.