August 25, Colombo (LNW): In a significant development poised to reshape Sri Lanka’s manufacturing and export landscape, CEAT OHT Lanka (Private) Limited has entered into a formal agreement with the Board of Investment of Sri Lanka (BOI) to establish an investment worth US$ 171 million.
This deal represents one of the most substantial capital infusions from India into Sri Lanka in recent years, underscoring a strengthening of economic ties between the two nations.
The agreement follows CEAT Ltd.’s recent acquisition of the Construction Compact Line business from the Michelin Group. As part of this transaction, CEAT has also taken control of key manufacturing facilities in Sri Lanka, including the Midigama plant and the Casting Product plant situated in Kotugoda.
This acquisition also paves the way for CEAT to eventually gain full and permanent ownership of the globally recognised Camso brand, following a transitional three-year licensing period. The full closure of this acquisition is currently in progress.
The BOI highlighted that this partnership not only represents a milestone investment but also strategically elevates Sri Lanka’s standing as a pivotal hub in the Off-Highway Tyre (OHT) sector. With export-driven industrial expansion as a national priority, this initiative is expected to contribute meaningfully to economic resilience and international competitiveness.
As part of its broader commitment to social responsibility and sustainable employment, CEAT OHT Lanka, in collaboration with Michelin Lanka and the Inter-Company Employees Union (ICEU), has signed a Tripartite Memorandum of Understanding.
This agreement guarantees the continued employment of approximately 1,483 workers, ensuring that existing employment terms—such as length of service, seniority, salaries, and benefits—will be fully preserved. Importantly, there will be no job losses as operations transition, signalling a stable and inclusive integration process.
Chairman of the BOI, Arjuna Herath, welcomed the development, noting, “This investment not only signals CEAT’s confidence in Sri Lanka’s manufacturing capabilities but also highlights the country’s emergence as a globally significant production base. We believe this move will catalyse further high-quality foreign investments.”
Amit Tolani, CEO of CEAT Specialty, remarked that the investment marks a new era in the company’s partnership with Sri Lanka, expressing optimism about the opportunities it will bring both to CEAT and the nation. “We are embarking on a new journey of growth, and Sri Lanka is central to that vision,” he said.
Adding further insight, CEAT Ltd.’s CFO Kumar Subbiah stated that the company’s immediate focus is on ensuring a smooth transition, maintaining job security, and enhancing operational capacity. “This investment reaffirms our enduring commitment to Sri Lanka and its workforce, and our ambition to build a world-class base for OHT manufacturing and exports here,” he said.
This strategic move not only solidifies CEAT’s stature in the global off-highway tyre and tracks market, but also positions Sri Lanka as a key node in the company’s international expansion strategy. At the crossroads of industrial development, workforce protection, and export excellence, the initiative is in alignment with the BOI’s vision of fostering high-impact foreign investment and driving sustainable national growth.
