British automobile major MG Rover, which last month signed a five-year agreement with Tata Engineering for selling the latter's compact car Indica under its own brand in the UK and Europe, is projecting sales of around 100,000 Indica cars over the period.

The two sides are also looking at expanding their relationship to gain from each others' strengths.

Towards this end, MG Rover is considering sourcing components from India and might tap Tata Engineering's vendors.

Further, neither company is ruling out the option of exporting Indica siblings like the concept sports car Tata Aria to Rover at a later date. They're only saying, "We have to do it one step at a time."

At a select press meet at Bombay House, the Tata group headquarters, on Wednesday, Kevin Howe, chief executive of the MG Rover group, said: "The Indica will be positioned below the Rover 25 (MG Rover's entry-level hatchback car), which is priced upwards of 8,000 pounds sterling. We expect sales of over 100,000 cars over the five-year period."

However, both Howe and V Sumantran, executive director at Tata Engineering, declined to reveal any financial details of the agreement.

They also declined to say whether Rover was obliged to sell a minimum number of cars during the term of the agreement, and the expected date for commencing exports.

However, sources close to Tata Engineering said the company's revenue from Indica exports would be on a "cost plus" basis.

Howe said MG Rover was interested in sourcing components from India, among other Asian countries, and might tap Tata Engineering's vendors for its requirements.

"We are looking at a number of aspects to grow ties. Both of us have the agility that comes from our relatively small size in the automobile industry as a common feature. At present, our focus is on the Indica. We want to do it one step at a time," Howe added.

Tata Engineering, as part of the agreement, will export completely built units of the Indica with the "genetics of a Rover," which will then be sold under the Rover badge in Europe.

Under the agreement, Tata Engineering cannot export the Indica by itself to the UK, MG Rover's host nation, but is free to export it to other parts of Europe using its own distribution network.