NEW DELHI, February 15: The royalty payment that Maruti Udyog Limited (MUL) has to make to Suzuki Motor Corporation (SMC) of Japan, following the MUL's board recommendations for renewing the royalty agreement, will amount to around Rs 90 crore for the three fiscal beginning 1997-98, a senior company official said."With the board having recommended the renewal of royalty payment to SMC for Maruti 800, Omni and Gypsy, it has been worked out to be around Rs 30 crore per fiscal till 2000, the year when it will come up for review once again," MUL's director (finance), A R Halasyam, told UNI here.
The royalty agreement for the three models was to come up for renewal on April 1 last year. But with both the Indian Government and SMC, equal partners in MUL, differing on their stand over the appointment of R S S L N Bhaskarudu as managing director of the joint venture company, the government had discontinued the royalty payment.
Besides, the agreements for Maruti 1000 and Esteem and the one of Zen will come upfor review in 1999 and 2001 respectively.
It may be recalled that the board of directors of MUL had at its last meeting on February five recommended the renewal of the company royalty agreement with Suzuki without any change in terms. The company will shortly submit its report to the Industry Ministry for ratification, following which Maruti will be giving royalty payments to Suzuki for the models.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
