India's Reliance Industries Chooses North Carolina for First North American Manufacturing Plant

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Researched by Industrial Info Resources (Sugar Land, Texas)--Reliance Industries USA, the U.S. subsidiary of the Indian conglomerate Reliance Industries Limited (BOM:500325) (Mumbai), plans to set up its first plant in the U.S. in Kinston, North Carolina. Reliance will invest $215 million setting up its manufacturing unit in Lenoir County to produce polyethylene terephthalate resin, which is used to manufacture plastic cans and specialty polyester yarns. The proposed facility is expected to create more than 200 employment opportunities in the region over the next five years. Reliance will lease part of a DuPont (NYSE:DD) polyester-manufacturing facility that was operated by Unifi Kinston, a subsidiary of Unifi Incorporated (NYSE:UFI) , that recently closed the facility, laying off 260 workers. Reliance acquired the facility from Unifi Kinston for nearly $12.2 million.

The Telegraph (Calcutta) reported that Thakur Sharma, President of Reliance Industries USA, attributed the company's choice of Lenoir County over other regions to several factors, including "the availability of an existing, adaptable facility, the area's long history in the polyester industry, the available skilled workforce and training capabilities, proximity to customers, and state and local incentives which will help offset the high cost of establishing a major manufacturing facility."

Reliance stands to gain as much as $2.2 million in benefits under North Carolina's Job Development Investment Grant program if it fulfils all contractual requirements, including the generation of employment opportunities within a period of five years and the sustaining of these jobs for nine years, beginning in 2009. Lenoir County has also offered an additional incentive of $4 million to Reliance, subject to the realization of investment and employment targets set by the company.

According to the North Carolina State Department of Commerce, the new manufacturing facility is likely to create a gross product value of $1.64 billion and net revenues of $53.38 million for the state over the next nine years. The average annual wage for workers in the plant is expected to be around $46,500, excluding benefits, which is more than 1.5 times the present average annual wage of $27,040 for workers in Lenoir County.

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