General Motors Corp. says it will construct an engine and transmission plant in Talegaon in India’s western state of Maharashtra near its new $320 million car assembly plant that begins production next week, AutoBeat Daily reported.

GM says it will sign a memorandum of understanding today with the government of Maharashtra. The company said last October it was considering setting up its first engine factory in India. It hasn’t yet provided details about the size of the investment or the plant’s capacity.

The new Pune car factory will have capacity to make 140,000 vehicles and will add production of a new low-cost minicar by 2010. An existing GM assembly plant in the western state of Gujarat has capacity to make 85,000 small cars and SUVs. GM, which also has a technical center in Bangalore, aims to double its share of India’s passenger vehicle market to 10 percent by 2010.