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BOMBAY, March 19 (AFP) - Italian automaker Fiat's Indian arm Tuesday said it will undertake a study on whether to introduce a new car in the Indian market, following the success of its mid-sized Palio model.

Maurizio Bianchi, managing director of Fiat India, said the company was considering all possible options to expand its business in the domestic market, which is showing signs of a turnaround.

"Our key projects such as Palio and Sienna are almost complete and we are now looking at various options to undertake a new project," Bianchi told AFP.

"It's still premature, but a new car would be one of the options as our market share is now around 6.0 to 7.0 percent. No decision has, however, been taken on this yet."

Bianchi said Fiat India would be completing investments of around 150 million dollars by next year for the Palio project in India, out of a total investment outlay of 400 million dollars for the country.

"We may also raise the production levels at our plant from two shifts to three depending on the car demand. We are receiving 200 orders every day for Palio itself and have an order backlog of 5,000," Bianchi said.

Fiat India's plant in Bombay, the commercial hub of India, has an annual capacity of 60,000 cars. The company has already sold 15,000 Palios since the car's launch in September 2001.

Bianchi, however, said Fiat India had no plans to use India as an export base for its global network.

"But we are using India as a sourcing base for auto components and have tied up with 80 vendors who meet our global requirements," he said, adding that this year nearly 20 million dollars worth of components were being planned.

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