India's Hinduja Group flagship Ashok Leyland on Thursday will inaugurate a vehicle assembly plant in Ras al Khaimah Investment Authority (Rakia).

The plant will be inaugurated by Sheikh Saud Bin Saqr Al Qasimi, Ruler of Ras Al Khaimah in the presence of Srichand P Hinduja, chairman of Hinduja Group, according to a report in The Economic Times.

In October 2006, Ashok Leyland had signed a MoU with Rakia for setting up the assembly unit, which eventually be upgraded to a vehicle assembly plant (for trucks and buses) in the second phase.

It was then announced that the new venture would involve an investment of $50 million in a phased manner.

The unit, with an initial annual capacity for 1,000 buses of international styling, manufacture and quality, will start operations, as a bus body assembly using Ashok Leyland chassis and bus body CKD kits sent from India (including Irizar TVS).

The facility includes a state-of-the-art paint plant for bus bodies, managed and operated by Ashok Leyland.

In January 2007, Ashok Leyland had announced the setting up of its subsidiary company in Ras Al Khaimah, at a cost of Rs 22.5 crore, for launching the bus body assembly plant to cater to the Middle East and neighbouring markets.