Tata Hitachi, the construction and mining equipment maker, has earmarked a capital expenditure of around Rs 250 crore over the next two years across its plants in Kharagpur, Bengal and Dharwad, Karnataka.

The capital expenditure is part of the company’s efforts to gradually shift production from its plant in Jamshedpur.

“We were earlier making 65-tonne and 120-tonne machines (excavators) in Jamshedpur. It will move to Kharagpur in another month’s time. We have land but to do that we are investing,” said Sandeep Singh, managing director of Tata Hitachi.

“The capital expenditure in the next two years is somewhere around Rs 200-250 crore for both the plants (Kharagpur and Dharwad),” said Singh on the sidelines of an event organised by the CII on Wednesday.

The company, a joint venture between Tata Motors and Hitachi Construction Machinery, with the Japanese company holding a majority 60 per cent stake, is also evaluating the production of 87-tonne excavators instead of relying on imports.

Tata Hitachi is bullish about a pickup in demand for excavators, especially in the mining segment, as public sector miner Coal India, which produces around 80 per cent of the country’s coal production, steps up its production to meet its target of 652 million tonnes in the current financial year.

“Tata Hitachi is a major player in terms of equipment manufacturing in our state. They are in our park and they are expanding. We have had two meetings. I am delighted that they are happy with the state and so expanding,” said state finance and industries minister Amit Mitra. He added that the state is exploring the possibility of emerging as an equipment manufacturing hub.

Mitra also said that the state may explore the possibility of selling coal (merchant mining) from the Deocha Pachami coal block. “When WBPDCL's own requirement of coal is enough, one can look at the possibility of merchant mining,” Mitra said.