Ruia said initial start-up capacity of 40 tonnes daily would be ramped up to 130 tonnes a day by December. The first tyres to roll out would be for light commercial vehicles and truck tyres, while tractor tyres would be produced later.

Of the 1,200 strong workforce, about 1,000 people would be absorbed, while 200 would be offered voluntary retirement scheme (VRS). The list was now being finalised with the unions, company sources said, adding that the surplus workforce was mostly from areas like canteen and security and some other areas, which would be contracted out.

Employees were likely to get a pay packet of about 8,000 rupees, and the company would be spending 8 million rupees (£91,000) a month on salaries.