1. Centre to pump in Rs 1.5 lakh crore in 4 new steel plants

Centre to pump in Rs 1.5 lakh crore in 4 new steel plants

The Centre said it will pump Rs 1,50,000 crore for building four new steel plants of 20-24 million tonnes...

By: | Rourkela | Published: February 1, 2015 8:00 PM
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Based on investment of Rs 6,000 cr for each mn tonne of steel and associated cost for mining, the total investment will be in excess of Rs 1,50,000 cr. (PTI)

The Centre today said it will pump Rs 1,50,000 crore for building four new steel plants of 20-24 million tonnes combined capacity in collaboration with the governments in four states.

“We have decided to build four new steel plants and four dedicated mining companies to feed these plants in four states partnering the respective state governments. We aim for six million tonnes capacity for each plant,” Union Steel and Mines Minister Narendra Singh Tomar said here on the sidelines of an expansion review meeting.

Based on investment of Rs 6,000 crore for each million tonne of steel and associated cost for mining, the total investment will be in excess of Rs 1,50,000 crore.

“We have decided to form SPVs for each plant and mining companies. We are already holding discussion with state governments. I had positive discussion with the Chattisgarh and Odisha and shortly we will talk with Karnataka and Jharkhand governments,” Tomar said.

He said the plan for new capacity has been envisaged to boost ‘Made in India’ focus and take the steel capacity of the country to 300 million tonnes by 2025 from 80 odd tonnes.

As per the plan, SAIL will invest in Chattisgarh, Rastriya Inspat Nigam Ltd in Odisha, NMDC Ltd in Jharkhand and Karnataka.

SAIL Chairman C S Verma said the details of SPVs are yet to be worked out but for each project, two SPVs will be floated, one for mining and another for plant.

Tomar was confident that new reforms and transparency in mining sector will help the steel sector come out of the current crisis.

He said all mines will now will be auctioned for sake of transparency.

Now, with Mining and Minerals Development Regulation Amendment Ordinance, now mineral producing states will have no additional power to stop inter-state mineral movement, Tomar said.

This will help states like West Bengal in attracting steel plants that do not have iron-ore.

Presently, states impose restriction on inter-state movement of minerals to retain investment in their own states.

Tags: Steel
  1. S
    Sivaramakrishnan
    Feb 2, 2015 at 7:19 am
    In one hand Govt is selling its stake in SAIL, CIL, etc.... then what is the need to invest in steel plant by govt? & Instead of spending the money in infrastructure projects why do they want to splurge 1.50 lac crores in an already oversupplied steel industry? To top it all China is pumping cheap Steel into world market and Indian companies want an increase in import duty on these steels, meaning they are incapable of producing steel cheaper than China... Even when large Private players find it difficult to compete with China, are we to believe in the efficiency of Govt run companies to give productive steel plants that will compete with China?.... Of course it is obvious this so called investment will never be completed in time and by time these plants start operation the cost will overrun 2/3 times....
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