Indonesian President Susilo Bambang Yudhoyono Monday inaugurated Indian two-wheeler major TVS Motor Company's factory here that will target this country's market.

The factory, located in 20 hectares of land in the Surya Cipta Estate with complete manufacturing facilities, will produce TVS Neo, a duck-shaped 110 cc Bebek step-through, for the Indonesian market.

It has a capacity to produce 300,000 units per year and would also start producing other variants and models in near future.

TVS chairman Venu Srinivasan was also present on the occasion.

"Our initial investment is about $50 million, with local value addition of 40 percent. This will be scaled up to $100 million over the next three years in order to achieve local value addition of 80 percent," said Srinivasan.

"We are long distance runners. Our interests in Indonesia are long term."

The Indonesian president congratulated the firm and hoped it will continue to grow and contribute to the country's economy.

TVS also plans to export products from the Karawang plant to other countries in southeast Asia.