General Motors warns Indian state that blocking its exit could hit future investment

American automaker General Motors (GM) warned that the Maharashtra government's move to block it from shutting a plant and exiting India may alarm potential investors.

Earlier this week, the state of Maharashtra rejected GM's application to cease operations at its plant amid protests by workers demanding that GM continue production or indefinitely keep them on the payroll.

According to GM, Maharashtra, in effect, wants them to produce vehicles that have no buyers or indefinitely pay workers for doing nothing.

A GM spokesman added that Maharashtra's decision contradicts its business-friendly reputation.

GM, which wants a reversal of Maharashtra's order as soon as possible, topped selling cars in India at the end of 2017 after years of low sales.

It sold one of its two Indian factories to Chinese automaker SAIC Motor Corp and continued to manufacture vehicles for export at its remaining plant until Dec. 24.

GM is offering around 1,500 workers at the plant higher than the statutory severance pay, equivalent to nearly two years of salary, and is open to further negotiations.