American car maker Chrysler is in talks with the Tamil Nadu government to set up a greenfield facility in the state. The company has agreed to send a team to Tamil Nadu to study the feasibility of the project in the state.

While the discussion with the Tamil Nadu government is at very early stage, a senior official in the government said that Chrysler was looking at expanding its operations in Asia and India is one market the car maker is keen to enter.

Earlier this year, a team of senior officials from various departments, including the Department of Industry and Information Technology from the Tamil Nadu government, toured the United States to woo investments into the state.

Members of the team met Chrysler executives to brief them on the advantages of setting up their first plant in Tamil Nadu.

The state government is embarking on an ambitious plan to sign MoUs for industrial projects worth Rs 30,000 crore this financial year. Government officials said that nearly 50 per cent of these would be in the automotive sector, while another 25 per cent could come from the electronic hardware segment.

Chrysler in one of the few global automotive companies that does not have a presence in India. Citroen of France and Proton of Malaysia, too, are yet to make their foray in India. Several times in the past, both companies indicated their keenness to enter India.

Sources in the government also said that since Chrysler separated from Germany's Daimler in mid-2007, the decision making process has become much faster and the likelihood of the American car manufacturer seeting shop in India is high.

In May 2007, Daimler AG sold 80 per cent stake in Chrysler to Cerberus Capital Management for $7.4 billion. The German car maker had paid $37 billion to buy the American brand nine years ago.

When Daimler and Chrysler were under the same management, Daimler's Indian executives had indicated that the only way the group would be able to look at bigger volumes in a country like India would be through the Chrysler brand.

At that time, a price band of Rs 10-13 lakh was widely discussed. The intention, however, remained on paper.

The entry of Chrysler in Tamil Nadu would only for fuel the race between Chennai and the Mumbai-Pune corridor for getting the prized automobile investments in the respective states. Both centres enjoy the advantage of having ports and are fast emerging as the Detroits of India.

The recently announced large automobile investments in Maharastra came from Volkswagen, General Motors even as the existing capacities of Fiat, Tata Motors [Get Quote] and Mahindra & Mahindra are being expanded.

On the other hand, Chennai managed seal big ticket projects like Nissan, Renault and Ashok Leyland [Get Quote]. It is also believed that the light commercial vehicle joint venture between Delhi-based Hero Group and Daimler AG will be set up in Tamil Nadu.