The Sunday Times FT - PM launches CEAT's new Rs 350 million hi-tech plant at Kelaniya

Sri Lanka's domestic tyre manufacturing industry rolled into a new age of hi-tech design and manufacturing last week with the commissioning of the country's first radial plant at the CEAT Kelani complex in Kelaniya.

Prime Minister Ratnasiri Wickremanayake and several senior government ministers participated in the ceremonial inauguration of the Rs 350 million automated plant which will produce car and van tyres that meet the highest international standards but are custom-designed for local conditions and requirements, CEAT said in a statement.

The new plant represents a quantum leap in local tyre manufacture in terms of technology deployed and is expected to bring about significant savings through import substitution and generate substantial foreign exchange through exports at a later stage.

Prime Minister Wickremanayake commended CEAT for the new investment the company had made. In a speech that focused on the need for cordial relations between employers and employees for a successful venture, the Premier urged the employees of CEAT to treat the company as their own and to work with commitment.

"Investors don't invest for charity. They invest to take some profits back. This must be understood. The main reason for the failure of public sector enterprises is the failure to understand this principle. Let's think afresh, let's think about the country," Wickremanayake said.

He said the government of President Mahinda Rajapakse was focusing on the need for the country to concentrate on the manufacture of finished goods and was moving away from export of raw materials and resources. Minister of Enterprise Development and Investment Promotion Rohitha Bogollagama placed on record the appreciation of the government of Sri Lanka for the effort taken by CEAT towards this mega investment in the rubber industry of Sri Lanka. "This is the first time a modern tyre for motorists is coming out of Sri Lanka. This is a strong manifestation and demonstration of the trade relationship between India and Sri Lanka," he said.

Chairman of Associated CEAT Kelani Radials Chanaka De Silva said that this was a project the company was determined to embark on because of the vast potential for it in Sri Lanka.

"The radial tyre plant will be a significant addition to our domestic manufacturing capabilities and at the same time help reduce the importation of low quality tyres, leading to saving of foreign exchange and acting in a way as a quality control medium," he said.

"We hope that our pioneering venture will also create a sense of national pride in the fact that we have world-class radial tyres that are made in Sri Lanka. This is truly a product that we can be proud of," he added.

The cost of the plant and machinery was financed by DFCC Bank while the entire working capital requirement was met by the State Bank of India (SBI). The funds were raised at attractive rates, the company said.

An ISO 9001:2000 certified company, CEAT Sri Lanka manufactures an extensive range of tyres at plants at Kalutara and Kelaniya. The company's product portfolio includes tyres for light trucks, trucks, buses, forklifts and heavy vehicles such as payloaders, graders and backhoe loaders. The company has exported over 2100 container loads of tyres to date to India, Dubai, Singapore, Philippines, Egypt, Africa and countries in the SAARC region.