Though all 12 gram sabhas voted against allowing Anil Agarwal’s Vedanta Aluminium to mine bauxite in Niyamgiri, the Vedanta Group executive chairman remains optimistic the Orissa government will soon allot another mine for the 1-million-tonne (to be expanded to 5) refinery. There is a lot of pressure on the state government, he told FE — while the refinery employed 7,000 people when construction was on, the number is now down to 2,000. This can go up to 5,000 once capacity expands to 5 million tonnes, and another 3,000 can be employed in mining. If the government wants, he says, the clearances can be put in place in 10 days.
Once the refinery operates at full capacity, within a year or two, asserts a confident Agarwal, the group’s India turnover can increase from $16 billion at the moment to $25 billion.
Unlike RIL which is also facing all manner of roadblocks in its expansion — apart from aluminium, Agarwal’s $3-billion investment plan for Cairn also depends on project clearances — Agarwal says he is not planning any overseas investment. “We have our hands full… Managing what we have is enough for now,” he says.
Will he bid for new oil blocks later in the year when the government announces the next round, given Cairn’s approvals are still stuck, including $1 billion in cost recoveries for old projects?
“Ab kumware hain, to ladki to dekhne jayenge”, Agarwal breaks into a laugh (a bachelor will go and meet girls, whether he marries them is a different matter).
No country of India’s size, Agarwal justifies his enthusiasm, can afford to not produce at least 50% of its energy needs – “we produce 10%”. So, just like Orissa just has to allocate a mine, he says, the government just has to clear policy. It is still very slow, he says, but Cairn which produces 1.8 lakh barrels of oil a day can ramp this up to 5 lakh barrels in two years if the necessary clearances are given. He has a $3-billion expansion plan contingent on this. At 5 lakh barrels, this means an import saving of nearly $12 billion – India’s current import bill is around $164 billion.
If the price of oil is $100 a barrel, he says, we produce oil at $4, and earn a profit of $15 – the government is getting $81 per barrel. “They should be running after us to produce more