Ahmedabad, Oct 7 Tata Motors and the Gujarat Government today signed a memorandum of understanding (MoU) for setting up 'Nano' car project in Gujarat.

The MoU was signed by Tata Motors Managing Director Ravi Kant and Gujarat Industrial Secretary Gouri Kumar.

The project plant will be set up in Sanand, 30 kms from the Ahmedabad, on the land of Anand Agriculture University (AAU).

Officials said that 1,100 acres of land would be given to the Tata Motors.

Tata Motors will produce 2.5 lakh cars annually in Gujarat; the capacity can go up to 5 lakh cars per annum.

The land for the "Nano" project is located within a 2200-acre campus owned by the Anand Agriculture University. The university has already transferred 1,000 acres back to the government.

The Gujarat Government had gone all out to woo Tata Motors ever since Singur project in West Bengal came unstuck.

Tata Motors' officials had also been looking at sites in Karnataka, Andhra Pradesh and Maharashtra in search of a suitable site for its 'Nano' plant.

Tata has said the Nano would be launched this month. It is expected to be priced around 1,00,000 rupees and would be the world's cheapest car. (ANI)