Major heavy machinery manufacturer Guangxi Liugong Machinery Co Ltd (Liugong) will establish an assembly plant in India this year.

Liugong manufactures wheel loaders, skid steer loaders, hydraulic excavators, concrete trucks and forklifts and has operated since 1958. It has more than 2,600 staff.

A Liugong statement said the company produced about 10,000 forklifts a year.

Liugong chairman Wang Xiaohua said the Indian plant was part of a global investment plan.

"Our firm has laid out a blueprint for overseas business development and we are on the way to a leadership position in our key target markets abroad," he told the China Daily.

"Liugong has been generous in research and development spending to maintain its competitive edge at home and abroad, with R&D earmarked for about two per cent of the company's total annual sales revenue."

Xiaohua said Liugong had plans to expand into Russia and was already established in Australia.

"Liugong is working on a feasibility study for setting up a production base in Russia after the one in India becomes operational, he said.

"To be well prepared for market penetration into developed countries, Liugong has set up its first overseas branch in Australia for R&D, testing and marketing."

Liugong Machinery Australia, based in Sydney, has added forklift distributor Hewlett Equipment Australia to its dealer network. Hewlett is based in Queensland.

Xiaohua said Liugong had about 30 overseas distributors.

Liugong's 2006 revenue was 8.09 billion yuan (USD1 billion).

The statement said Liugong produced 20,000 construction units annually.