The additional investment is for setting up a colour monitor plant, enhancing the current capacities of refrigerators, washing machines and R&D activities.

LG is investing an additional $20 million in its digital R&D centre in India which will reduce product launch time from around 12-14 months to around 6-7 months. It will further look into the areas of software development, circuit development and mould development. Out of the proposed investment in R&D, $5 million will be invested this year and another $15 million over the next 16 months towards development of moulds, product and circuit development and new product development.

LG Electronics is setting up an airconditioner and refrigerator compressor manufacturing facility in India with an installed capacity of around 10 million units.

The project will be set up at a cost of $10 million LG Electronics' in-charge of overseas sales MB Shin told The Financial Express.In the audio segment, LG Electronics has already initiated a feasibility study and will be launching high-end products like the MP3 players and other hi-fi systems.

Initially, all the products will be imported and the manufacturing in India will be taken up at a later stage, LG Electronics India vice-president Ajay Kapila said.

Other areas identified for growth are information technology and multimedia. The revenue contribution from this segment is expected to increase to 20 per cent of the gross revenue compared to 7 per cent at present. Among products proposed to be launched are peripherals, CD-ROMS, DVDs, networking products, LCD cameras/projectors and PC cameras. These products are already out in the international market and were on display at the recently held Korean electronics show in Seoul.

LG Electronics has also initiated a study to set up another greenfield manufacturing facility in the eastern or western part of India to enhance its capacity of home appliances and consumer electronics, said Mr Shin.

The Indian subsidiary, LG Electronics India, will invest the committed amount of $296 million in the country by the year 2003 as against the earlier projected year of 2005.

It has already invested close to $150 million in India and the balance investments are expected to flow over the next two years for R&D, greenfield plant, compressor plant and enhancement of capacities.

The greenfield plant is being planned to meet the exponential growth witnessed in the Indian market for consumer electronics and home appliances.

LGEIL will be contemplating a capacity of at least five million CTVs, three lakh washing machines, one lakh microwaves, two lakh ACs, 1.5 lakh vacuum cleaners and five lakh colour monitors, a top company official said.

LG Electronics India is already in the process of enhancing its refrigerator capacity by one lakh units to two lakh units per annum.

The compressor plant will cater to requirement of compressors for its refrigerators and air-conditioners in India, which is expected to exceed 7.5 lakh by the time this plant comes up, said Mr Shin. The plant is expected to start production in three years time.

The company is also looking to increase exports from India to $10 million by next year.

It will enter the vacuum cleaner market with the launch its vacuum cleaners under the "Health Guard" sub-brand later in the month. The product will be priced in the range of range of Rs 4,500-10,000.

LGEIL is also launching four new refrigerators in the 200-300 litre range. The company is investing $10 million to set up a production line to this effect. Further, in order to meet its commitment of going public, LGEIL has kicked off an exercise to value its stock.

After revising the turnover target for the current fiscal from Rs 1,500 crore to Rs 1,750 crore, LG Electronics turnover is expected to touch Rs 5,000-crore mark by the year 2003. This will be primarily led by CTVs, IT and multimedia products and few home appliances.

(The travel for this story was sponsored by LG Electronics)