Kamaz Vectra Motors, an Indian joint venture of Russian truck maker Kamaz with Indian conglomerate Vectra Group, has been ordered by local Indian authorities to suspend operations following an inspection of the plant. Kamaz holds 51% of the JV.
The local authorities claim that the joint venture doesn’t have a licence and its workers are simultaneously employed at another company, which is illegal.
Media reports quoted an unnamed manager of the JV who confirmed that production had been suspended but said there was no serious problem and a solution would be found “in the near future.”
The JV was launched in late February and has so far produced fewer than 100 trucks, while its target for 2010 is 1,000.
Russian companies have previously faced problems operating in India. Tekhnopromexport had to suspend construction of a power plant in 2007 after the Indian authorities refused to recognise the company’s switch into an open joint-stock company from a federal state unitary enterprise. The conflict was resolved only this month.