NRB Approves Thai Bearing Plant Study

NRB Bearings Ltd. recently approved a plan to investigate setting up a bearing manufacturing plant in Thailand. NRB manufactures needle roller, thrust and cylindrical roller bearings; the majority of its output -- 85% -- goes to automobile and light truck manufacturers. In the Indian market, NRB is also a key supplier to the textile and rail industries. An investment in Thailand would b NRB's first outside India. The company currently has manufacturing plants in Thane, Aurangabad, Jalna, Waluj, and Hyderabad. Thailand, however, has become far less inviting to foreign investors since political instability developed. In September 2006, after months of mounting unrest, Thailand had a military coup which unseated Prime Minister Thaskin Shinawatra while he was outside the country. In his place now is General Surayud Chulanot, promising fiscal and political reforms, and an end to sectarian fighting in the south. In November, the new regime implemented strict foreign capital controls, triggering sell-offs by investors and putting virtually all new plant and foreign investment projects on hold. Most troubling, a series of bomb blasts in Bangkok on New Year's eve day killed eight people, injured at least 38, and forced the government to cancel elaborately planned New Year celebrations. Most manufacturing businesses operating in Thailand say they intend to stay for now, but have registered severe concerns about the country's future political and financial stability -- particularly as Muslim action against Buddhists in the southern provinces escalates. Of the New Year's bombings, General Chulanot said: "From the evidence we have gathered, there is a slim chance that it is related to the southern insurgency." Instead, he blamed Thaskin supporters: "It is likely related to people who lost their political benefits." NRB has made no statement about its Thai strategy, and it is reportedly not on the agenda for the company's next board meeting. A number of bearing manufacturers have been successfully operating in Thailand for many years. Founded in 1965 as a joint venture with French needle bearing manufacturer Nadella, NRB now has an overall 13% market share of India's bearing market.