India's top carmaker Maruti Suzuki is to invest 40 billion rupees ($716 million) to set up a new manufacturing facility in the western Indian state of Gujarat, raising its total capacity to 2 million units by 2015-16.

The company has signed an agreement with the government of western Indian state of Gujarat to buy land to set up a new manufacturing facility, it said in a statement on Saturday.

Maruti Suzuki estimates it will generate employment for more than 2,000 people.

Maruti, 54.2 percent owned by Japan's Suzuki Motor Corp. on Friday, reported a 5 percent fall in its monthly vehicles sales in May. REUTERS