Andhra Pradesh welcomes VW special envoy

26th July 2005, Comments 0 comments

26 July 2005, NEW DELHI - The southern Indian state Andhra Pradesh on Tuesday welcomed Volkswagen's appointment of former German ambassador to India, Frank Elbe, as a special envoy, saying it was "determined" to have the German automaker establish a plant in the state.

26 July 2005

NEW DELHI - The southern Indian state Andhra Pradesh on Tuesday welcomed Volkswagen's appointment of former German ambassador to India, Frank Elbe, as a special envoy, saying it was "determined" to have the German automaker establish a plant in the state.

A spokesperson for Chief Minister Y S Rajsekhar Reddy said "the Chief Minister has welcomed the appointment of the special envoy. The government of Andhra Pradesh is determined to pursue the management of Volkswagen to set up the project in the state".

The spokesperson added that the Andhra Pradesh government would extend all possible help to enable Volkswagen to establish its manufacturing unit in the state.

He cited the government's decision to reduce power rates by four per cent among the efforts to boost foreign investment.

The government statement came after VW sent a letter to the Andhra Pradesh government announcing the appointment of Elbe in the wake of the "unexpected and unpleasant incidents in the recent past".

Volkswagen said Elbe's role is "to strengthen our common foundation of trust" and to build the future relations of Volkswagen with India".

The letter also said Volkswagen had only temporarily put its India project on hold "so that we confirm again our serious intention and strong interest in entering the Indian market".

VW was referring to the affair involving the company's former top representative to India, Helmut Schuster, who stands accused of misleading the state of Andhra Pradesh by promising that Volkswagen would build a factory in the state if a payment of EUR 2 million was made.

The fee was paid into a dummy company controlled by Schuster and his Indian associates.

The German firm has said it will assume responsibility for the damage caused by the suspected illegal dealings of Schuster and return the money to the state government.

DPA

Subject: German news

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