Mahindra and Mahindra, a part of the US$19bn Mahindra Group based in India, entered into a joint venture with Ideal Motors, a fully owned subsidiary of the Ideal Group, to assemble automotive vehicles in Sri Lanka.

Mahindra will hold a 35% stake in the JV, while Ideal Motors will have 65%. Ideal Motors has been a Mahindra distributor for the last nine years and this joint venture will strengthen the brand presence in the country. The plant will be developed over the next year.

Sanjay Jadhav, vice president, head of international operations - AFS (South Asia), Mahindra and Mahindra, said: "Sri Lanka is one of Mahindra's top three export markets and the announcement with Ideal Motors builds the foundation for newer opportunities for both of us in the island nation. We have a strong vision for growth in Sri Lanka and this move is an integral part of that plan. The changes faced by the automotive industry today are triggered by the accelerated rise of new technologies, consumer needs and sustainability in policies, we see the need to anticipate new market trends, explore alternatives and build powerful synergies.

Nalin Welgama, founder and executive chairman Ideal Group, said: "Ideal Motors is proud to be a pioneer in setting up the first automotive assembly in direct partnership with Mahindra."

"The new facility will not only contribute to human capital development but will also enable collective development of local automotive components manufacturers to international standards under the global expertise of Mahindra."