Honda is close to setting up a plant in India at Khushkhera, near Delhi, according to local press.

The automaker has been considering sites of around 700 acres around the country. This would be Honda's second plant in the country.

In 1997 it started manufacturing cars at a greenfield plant built on 150 acres at Greater Noida in Uttar Pradesh. The initial installed capacity of the plant was 30,000 cars a year but this has since been increased to 50,000. Currently, the plant is being run on two shifts.

Honda plans to further raise the capacity to almost 100,000 by 2007, three years ahead of its original schedule of 2010.

Honda president Takeo Fukui said last May that the company will consider further investment in capacity in India in the near future as required.